Oil and Banking Controls

Can we draw connection points between events off the Louisiana Coast and the financial meltdown of 2008? Hmm, let's see. So the blow-up of financial markets was largely triggered by the fact that regulatory controls over things such as the way in which mortgages in the secondary market could be packaged as institutional grade securities were substantially eased. No regulatory controls, the build-up of unchecked risk and kaboom!

Let's now fast forward to a rig in the Gulf of Mexico in 2010. Lax regulations on drilling standards (why mandate the need to drill relief wells? we're okay), because it's just an added cost. Once a crazy build-up of methane encountered, the whole thing becomes a timebomb that explodes minutes after.

For the most part, Canada is a pretty dull place. Too many rules and not enough looseness. It's the type of place where the government likes to stick their fingers in places the free market thinks it has no place, like banking systems and oilfields. The regulators impose a ton of risk controls and compliance measures required to do business in these spaces and come down hard on those who choose to cut corners. It's a place where rigid controls over who gets mortgages and for how much are strictly enforced. It's also a place where any offshore drilling can only take place if relief wells are drilled.

So far so good in the Great White North. As for the issues that flying fast in the U.S.? Maybe sticking to the old line about Communist buggaboos will hold back that wolves.