As I've said here before I'm not averse to a change in the regulations covering finance. But do note the other half of my point, which is that it is "change" in regulation, not necessarily more regulation nor even is it less. There are two sadnesses about what is being suggested for new financial regulation. The first is that everyone is saying that change must mean more having entirely forgotten Kingsley Amis' point that more will mean worse.
The second though is much more important: those legislators actually proposing either changes or more financial regulation don't understand what it is that they're trying to regulate. Thus the regulations proposed are worse than not changing them. An example from the US:
First, Dodd’s bill would require startups raising funding to register with the Securities and Exchange Commission, and then wait 120 days for the SEC to review their filing. A second provision raises the wealth requirements for an “accredited investor” who can invest in startups — if the bill passes, investors would need assets of more than $2.3 million (up from $1 million) or income of more than $450,000 (up from $250,000). The third restriction removes the federal pre-emption allowing angel and venture financing in the United States to follow federal regulations, rather than face different rules between states.
That last would not be a good idea, the middle one isn't really all that important but the first would kill venture capital stone dead. People do really not get all excited about a new company, scramble around to build a plan and then go on holiday for three months while bureaucrats ponder said plan. It's really rather the opposite: if the plan's a good one it will attract financing quickly and by the end of 120 days people are already working away, building things and collecting paycheques for doing so.
Specifically, one of the things we need to take into account is while 10 years ago it may have taken years to build a company, companies are now built in a matter of weeks. So this 120-day waiting period is frankly ridiculous. I have companies with tens of thousands and hundreds of thousands of users that are built in a matter of weeks. They’re generating actual dollars of revenue, creating jobs, investing in real estate office space, capital equipment, etc. If they had to wait 120 days to actually apply for the ability to obtain financing it would absolutely just crush that market.
So Senator Dodd intends to eviscerate the funding mechanism for new and innovative businesses at exactly the time when the US needs more funding for new and innovative businesses to create new jobs and get the economy moving again. All because he operates under the delusion that business operates at the same glacial pace as bureaucracy.
All of which leads to the conclusion that while we might indeed desire changes in the regulations covering finance we'd rather like such changes to be done by those who actually know something about finance. Which, clearly and obviously, means we'll have to lock the politicians out of the room while the adults discuss what changes there should be, doesn't it?