The carrot or the stick: finding a balance in the regulatory conundrum

Introduction

‘A complex financial world will be made less fragile only by simplicity of regulation and strength of enforcement’.[1] These are the words of Niall Ferguson, from one of the Reith Lectures he gave for BBC Radio 4 in 2012. The political nature of banking regulation and its impact on the economy draws out the opinions of many public figures from wide range of specialties. Ferguson, a journalist and a historian, is not a principle source of legal authority, but he does make a persuasive argument, delivering it in a concise and reasoned manner.