Do we not need a Martin Act to crack down on regulators who dare regulate banks without having a clear idea about what they are doing?

Sir, Brooke Masters writes “global banks and other big financial services groups have lived in fear of an old New York state anti-fraud law. The Martin Act has been used to crack down on biased Wall Street research, insurance bid-rigging and “dark pools” said to mislead traders, among many things” “Loosening the law that haunts bankers puts us at risk” June 20.

Great! But why is there not anything similar when for instance European regulators and central bankers assign a 0% risk weight to Greece. Of course they must have known Greece was not worth it, no sovereign is, and yet they went ahead. And the final consequence of that have been horrible sufferings resulting from excessive public debt, but without the slightest indication of holding those responsible for it accountable.

Yes “The US system relies on fears of prosecution and giant fines to help keep banks and insurers honest”, but what do we have to keep technocrats from regulating when they obviously have no idea about what they are doing… like for instance when they think that what is ex ante perceived as risky poses ex post more dangers to our bank system than what is ex ante perceived as risky.

@PerKurowski