As usual after a financial crisis, we hear demands for new controls and regulations to stop it from happening again. But since every crisis has led to thousands of new pages of regulation, why is it that regulation doesn’t stop crises from happening again?

No matter what pundits say, we are nowhere near a laissez-faire situation. Look no further than the US federal institutions in Washington DC and we find 12,113 individuals working full time to regulate the financial markets. What did they do with the powers they had?