This is politics very thinly veiled as economics, and there's also a lot of misinformation in it. But one thing in the piece stands out as so incredibly wrong but often repeated, that it must be debunked and re-debunked and argued against until the reality of things becomes common wisdom:

> They provided support for the movement which stripped away the regulations that had provided the basis of financial stability in the decades after the Great Depression

This is not the case. The financial system is incredibly complexly regulated, and the regulations are growing each year. They're too complex for lay people to understand. As such, you get a phenomenon called regulatory capture -

http://en.wikipedia.org/wiki/Regulatory_capture

"Regulatory capture occurs when a state regulatory agency created to act in the public interest instead acts in favor of the commercial or special interests that dominate in the industry or sector it is charged with regulating. Regulatory capture is a form of government failure, as it can act as an encouragement for large firms to produce negative externalities. The agencies are called Captured Agencies."

Regulatory capture always happens in large money industries where the regulations are too complex for lay people to understand and get upset about. Regulations grow each year in banking, every single year - and the regulations inevitably benefit the banking industry, who have lobbyists, experts, panels who are deeply interested in getting their way.

This is very important:

The entire financial system is created by regulation.

We use paper money because it's required to use in the United States. The U.S. dollar, for instance:

http://en.wikipedia.org/wiki/Legal_tender

"Legal tender or forced tender is an offered payment that, by law, cannot be refused in settlement of a debt, and have the debt remain in force.[1] Currency is the most common form of legal tender."

From there, the printing of money is created by regulation, the banks are beholden to the printing body, and so on, and so on. This mess is indeed a failure of regulation - the regulation created it. The entire financial system, top to bottom, is probably the most heavily regulated in the world. Regulation created it. It's already heavily regulated. The regulations are twisted over time to benefit the banking industry itself.

I'd encourage everyone who hasn't read it to the Austrian theory of the banking cycle:

http://en.wikipedia.org/wiki/Austrian_business_cycle_theory

"The theory views most business cycles (or, as some Austrians prefer, "credit cycles") as the inevitable consequence of excessive growth in bank credit, exacerbated by inherently damaging and ineffective central bank policies, which cause interest rates to remain too low for too long, resulting in excessive credit creation, speculative economic bubbles and lowered savings."

It's a very interesting theory, and pretty convincing to me. Central banks set interest rates artificially low, people borrow a lot, inflationary bubbles happen, things crash. Today it's bad mortgages derivatives, yesterday it's bonds, before that it's the stock market a few times, next it's something else.

A country with legal tender laws ("you must accept this kind of money"), money of no inherent value (which would act as a natural check to printing more), an agency that can create that money at will (the Federal Reserve), and uses this new money to set interest rates artificially low (which it does) - this always leads to crashes, always. We don't need more regulation, we need to tear the whole mess down. Politicians have proven repeatedly that they can not be trusted with the ability to print money that you're required by law to take.