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Politicians show what not to do in a crisis

When the going gets tough, the urge to increase regulation in the financial markets grows stronger. As the sub-prime crisis has spread from the banking sector into the rest of the global economy, so the demands to pass laws and make new rules to try to ensure it isnÃ¢ÂÂt repeated grow more strident.

The European Union is considering rules that would make banks set aside more capital when they sell some of their credit products. The plan would make securitisation more expensive for banks, and is aimed at stamping out some...