kaal:claim:2714974-029

Any prescriptive regulatory regime for hedge funds risks leaving the financial system less stable rather than more stable, because counterparties relax vigilance when they believe authorities are monitoring and constraining fund risk taking.

Source quote, verbatim

A risk of any prescriptive regulatory regime is that, by creating moral hazard in the marketplace, it leaves the system less rather than more stable.

From

Kaal and Oesterle, The History of Hedge Fund Regulation in the United States (2016), INDIRECT HEDGE FUND REGULATION, p. 26
https://ssrn.com/abstract=2714974 · source PDF

Cite as

Kaal and Oesterle, The History of Hedge Fund Regulation in the United States (2016). SSRN: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2714974

Holds when

applies to prescriptive position reporting and monitoring regimes

Classification

failuresupport: arguedfailure: Prescriptive regime destabilizationfamily: moral-hazard-and-bailout-expectationrisk-and-incentivescompliance

Verify

The quote above is an exact substring of the source PDF, whose sha256 is 7764601d3ed5bb056b58949e8411eff9dfb9855f143719062030c980c5fa801b. Extraction method: pdf-text-layer.
Attestation record: colloquium/attestations/6d3a6a65957c9bea...json
Verify the binding yourself: curl -s https://wulfkaal.github.io/claims/2714974-029.md | sha256sum

Positions extending this scholarly claim

Extension: AI risk governance in Islamic digital finance