With some signs starting to emerge that the worst of the financial crisis might be behind us, the regulators and politicians can now move on from fire fighting to legislating for the future shape of the financial world. The authorities want to be seen to be doing something, acting tough and acting fast. But while things will clearly be different in the future, the regulators need to take care their acts do not have the sort of unfortunate unintended consequences already occurring. For example, creating a complete replacement for the IAS 39 standard within a year or so (see p13) is a tall order for the IASB, while in the US some politicians want to outlaw tailored derivatives (see p12). At least the Bank of England is trying to find constructive ways to help companies with their financing (this page).
