In Defense of Free Capital Markets

With capital markets reeling from blows dealt throughout the 1990s, international leaders are considering tighter regulation to prevent future damage. Bloomberg News columnist and Yale School of Management adjunct professor David F. DeRosa argues that capital markets work best without intervention. DeRosa reasons that while well-intentioned financial reform advocates are often unaware of what makes international capital markets tick, understanding the causes of financial crises is key to learning how best to handle them. Through his engaging analyses of major financial upheavals, such as the Mexican peso crisis of 1994-1995 and the Asian currency crisis of 1997, DeRosa unravels the complexities that triggered and fueled these events. He further investigates the ironies of the regulations intended to prevent the very crises they helped to spark.