UK FSA has designs on retail product design

Designs on design

Do product innovation and complexity exacerbate risk along the chain of financial intermediation? An intuitive answer to that question would seem to be ‘yes’, but economic theory has led many to believe self-correcting markets would clear all such risks through innovative responses such as derivatives and securitisation. Previous regulatory and legislative responses to perceived problems of opacity and overcomplexity in financial products have concentrated on retail financial products, for