It seems like a major problem was that too many were reliant on the software of an agency to rate securities that were too complex for the rating to be verified independently. That, coupled with corporate
political fear of delivering massive bad news as soon as it was discovered led to catastrophe. It was a giant system with a single point of failure that failed.
It doesn’t seem like a failure of regulation or of deregulation. Just human error, bad judgment, and people who didn’t know how to directly value what they were trading.
I don’t think more upfront regulation would have avoided much of this, though.
Regulators and rigid rules wouldn’t have been any smarter than the interested parties.
It’s always tempting to point fingers of blame. We’re all biased towards finding vindication for our prior convictions in complex crises.
But, it would be pretty amazing if this whole problem could have been averted by better software testing.