ESMTcast - "Learning for Leading" | Episode 4: Insights on regulation and risk

[charlessmyth]

Markets use failures to correct for mistakes. But it is unusual for a market failure in a diverse economy to blow out the entire economy. The market setting of interest more properly regulates the amount of available credit, without the need for any government intervention. This may result in a failure of a particular line of business. But if the business is fundamentally sound, it can be recapitalised at a lower price, and will continue, without the accumulation of unintended consequences.