ABSTRACT
This book has thus far unpacked three elements of the Regulatory Instability Hypothesis. Chapter 3 examined the regulatory cycle and explored how feedback effects can develop between asset price bubbles, on the one hand, and deregulation and other regulatory stimuli, on the other. Chapter 4 explored how bubbles promote fraud and undermine compliance by market participants with financial law and regulation. Chapter 5 analyzed how bubbles and regulatory arbitrage reinforce each other in spirals that feed bubbles. The last chapter looked at how deregulation and regulatory arbitrage create feedback for one another and can fuel asset price bubbles.
