Originative sin

Very balanced article in the FT by John Plender on innovation in financial markets, quoting Merton Miller as saying in 1986 that "the major impules to successful financial innovations have come from regulations and taxes". Apart from a good narrative on the current crisis, Plender ends by suggesting that as both taxes and regulation are likely to increase in the near future, it may be unwise to call the death of financial innovation just yet.