Major deregulation starting in the 70’s paved the path for quick-and-easy money schemes of which securities could be traded at high risk to create a high payout. Individuals had the ability to leverage at astoundingly high rates, allowing them to multiply their profits, or riddle themselves with debt they could not account for. This created massive problems as individuals began borrowing money to pay for previous loans. The financial collapse of 2008 marked a point in modern history which proved the need for financial regulation. Yet almost 4 years later, major changes are nowhere close to being implemented.
This lack of progress is discouraging to investors who saw “economies melt away in the murky depths of a runaway derivatives markets“ in 2008. Although economic growth is still possible, market stabilization is crucial to the recovery of the economy, especially in a time when job growth is beginning to plateau and countries are on the brink of default. I believe that due to the fragile state of the world’s economy, it is important for Canada to implement these regulations to create security within the national economy from external volatility.