Professor William Black:

Again, extreme growth is itself something that should not be allowed by a regulator. We have centuries of experience that tell us that is true. The concentration of risk is something that is insane for a large institution. In other words, small players that cannot reach economies of scale have to have niche strategies, so they will concentrate. That is riskier but they have no great choices. All their choices involve material risk but you do not want a very large financial institution concentrating its risk in a product line like commercial lending. Even if you were going to concentrate on commercial lending, you would never prudently concentrate in a small number of borrowers. The old joke they tell about banking is absolutely true. If you borrow $10,000 from a bank, the bank owns you but if you borrow $100 million from the bank, you own the bank. The banks will extend even bigger loans to you and, as long as new money is coming in, you can keep the thing alive a bit.

That is always a bubble disaster. We have known this for many past crises. This was something that was easy for the bankers and for the regulators to figure out. The Irish crisis was one of the most easily preventable crises by either competent bankers or competent regulators.