Arnold Kling with a great round up of regulatory thoughts

here:

The functional approach to studying financial institutions and regulation begins with the observation that there are six functions of the financial system--a payments system, a pooling mechanism for undertaking large-scale investments, resource transfer across time and space, risk management, information provision for coordinating decisions, and a means of contracting and managing agency problems. Because functions tend to be more stable than institutions, regulations designed around functional specifications are less likely to generate unintended consequences.--Andrew Lo

Thanks to David Warsh for the pointer. Lo has a number of interesting proposals, including the creation of a "risk balance sheet." His point is that accounting statements are historical snapshots, but they don't say much about the susceptibility of the firm's finances to possible future events. I would caution that the Risk Disclosure Problem is not easily solved.

James Martin, the guru of information engineering, claimed that within a firm, the data entities are more stable than the business processes, and the business processes are more stable than the organizational structure. So if you're a bank, there will always be entities such as "customer," "account," "interest rate," and so on. The business process may change--you can introduce online banking for example. And you can always do a re-org--you could put transaction processing under "customer relationship management" or under "operations."

...

When I was at Freddie Mac, we tried to use information engineering, but it was too difficult. The result is that we were stuck with a variety of systems that did not talk with one another very well. I suspect that in the real world this is often the case. This suggests another reason to have limited expectations for regulatory reform.