Investing Quote by Michael Lewis
““Every systemic market injustice arose from some loophole in a regulation created to correct some prior injustice. “No matter what the regulators did, some other intermediary found a way to react, so there would be another form of front-running,””
About This Quote
Source Book: The Big Short, 2010
Regulatory fixes create loopholes; new intermediaries exploit them, leading to fresh market abuses.
In simple terms: Regulations cause new loopholes.
Key Takeaway
Design smarter oversight.
Themes
finance
regulation
market dynamics
innovation
Mood
analytical
critical
cautious
Type
economic
ethical
When to use this quote
- investment banking
- cryptocurrency
- housing market
- policy making
Key Concepts
systemic risk
regulatory capture
ethical dilemmas
Questions to Reflect On
- How can regulators anticipate unintended consequences?
- What incentives drive intermediaries to exploit rules?
A Different Perspective
Complex solutions may be impractical to implement.
![“Crucial decisions are made, today as thousands of years ago, in terms of the intuitive guesses and preferences of a few men in positions of authority...[it is] quite likely that the fate of entire societies may be sealed by a series of avoidable mistakes committed by their leaders.” quote by Michael Lewis](https://sms4smile.com/quotes/img-quotes/a59/michael-lewis-705_decision-making_crucial-decisions-are-made-today-as-thou_16888.jpg)
