"Regulation," as it related to the financial crisis, has become something of a vague buzzword, so I'm happy to link to Bob Kuttner laying out the seven deregulations that enabled Wall Street's implosion and three regulatory moves that could help right the ship.I'll just add that the crisis is, to a substantial degree, a function of the regulatory state freezing up sometime around the 80s as the conservative revolution both deregulated and, ore importantly, prevented new regulations from being enacted. But Wall Street continued to develop new financial instruments and institutions. As such, it's not so much that we actively deregulated our way into this crisis as that we passively failed to enact the regulatory structure that could have prevented it. The result of the asymmetry was that, by 2008, whole sectors of the financial system were operating outside any oversight, and they did basically what history has shown they do: Got overzealous in pursuit of profits, took on too much risk, allowed too much speculation, and caused a massive catastrophe. It's become something of a cliche, but economies don't work without markets, and markets don't work without regulations and rules.
