To ensure that the economy functional, a working financial and security market is necessary. It is vital to note that the market needs to be regulated for it to run in the right manner. The primary object of the regulation is to ensure that the economy is stable. Also, regulation of the market will ensure that there is customer protection, market confidence, and financial crimes are eliminated.
For many years, the state has been in the control of the security and financial market through imposition of various regulations. The reason why the government has to have a lot of control is because this is a sector that almost everyone depend on. The government for instance will have to regulate the financial instutions because people depend on the for saving and borrowing. Beside the government, people in the private sector like Chris Brummer has been struggling to ensure that the security and financial market is regulated.
in support of the regulation of the security and the financial market, the US government has established several regulatory bodies. These agencies include the Federal Reserve Board, Security and Exchange Commission. The agencies are mandated to ensure that the financial and security institutions are strictly abiding by the set regulations. Noncompliance is associated with multiple consequences such as enforcement proceeding. As a result the customers of the financial institutions will be safe.
There are several advantages of financial and security regulations in a country. Customers will be the first beneficiaries; they are going to be protected from the credit card, mortgages, and other products frauds. The investors will also benefit from any unethical actions in the market. The results is that the investors cannot lose their money. Financial firms will not be required to put a lot of risk on the money of the client. Finally, regulation is directed to the monopolies to ensure that they do not produce defective products.
According to financial expert Chris Brummer, every citizen is supposed to have at least an overview on how the financial and security system works. The financial expert in additions requested people to have an understanding of how they use their finance at a personal level. With the knowledge, it will be easy for you to make the correct decisions on financial matters. Another instance, when the financial and security regulation knowledge is required, is when you are taking debt. This is because it will help you understand the terms of payment.
As you read, it is clear that regulation of the security and financial market is critical. Continuous efforts should be put into this sector by both the government and private sector to ensure that the market is very safe.