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Financial crises, in particular, tend to leave scars that make financial institutions, households and firms behave differently.
IN her book, Ms. Bair lists 13 actions that she thinks would make financial institutions stronger, and regulators more effective.
She has also joined the Just Money campaign, to make financial institutions work for communities, co-ordinated by community organising charity Citizens UK, which built an alliance of Christian, Jewish and Muslim leaders who first called for the cap back in 2009.
All of these relationships make financial institutions more tightly interconnected.
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But Mr. Wechsler said the disclosure might nonetheless hamper intelligence collection by making financial institutions resistant to requests for access to records.
The flight from risk since August has made financial institutions reluctant to lend to each other, driving up banks' borrowing costs.
"On the other hand, you must be sure that regulation does not snuff out the entrepreneurial vigor and financial innovation that drives economic growth and makes financial institutions successful and profitable".
Levey said that the market turmoil has worked to the USG's advantage: the crisis has made financial institutions even more risk-averse, thereby lessening Iran's attractiveness even further.
Making financial institutions smaller or simpler doesn't really address systemic risk.
There must be greater transparency and accountability throughout, from dispelling the secrecy which enshrouds tax havens like Switzerland, to making financial institutions accountable for knowing their customers and for refusing to accept the proceeds of crime and corruption.
LONDON, May 28 (Reuters) - Bond investors say they could stop funding Europe's fragile banks if rules designed to insulate them from shocks are put in place, making financial institutions even more vulnerable to the debt crisis and possibly more reliant on taxpayer money.
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