Financial Markets: Regulators Essential to Preventing Catastrophic Meltdowns
The article discusses the difference between risk and danger in financial markets, comparing it to race car driving. It suggests that while risk can be managed, dangerous situations require government intervention. The main goal is to define the role of financial market regulators in creating and maintaining self-regulating markets that are risky but avoid danger. The key finding is that distinguishing between manageable risk and uncontrollable danger is crucial in financial regulation to prevent situations from spiraling out of control.