Abstract
This article examines the potential efficacy of macro-prudential financial regulation as a mechanism for preventing future systemic crises. I argue that the potential efficacy of macro-prudential financial regulation will be undermined by (1) the complexity of financial markets and our incomplete understanding of them, (2) the shortcomings of our quantitative models for measuring and managing risk, (3) the need for internal and cross-border consensus, and (4) the bluntness of available macro-economic regulatory mechanisms in terms of their ability to actively manage risk within financial markets.