It went largely unnoticed that those crises had something in common: destabilizing factors caused by financial innovation and the lack of regulation.

Image Treasury Secretary Lawrence Summers, right, with the Fed chairman, Alan Greenspan, in 2000. Credit... J.Scott Applewhite/Associated Press

That was true in Asia, where countries had followed the advice of groups like the International Monetary Fund and done nothing to control huge flows of capital into their economies. When the news turned bad, that capital tried to flee. Currencies collapsed and bailouts ensued.

Then came the collapse of the Long-Term Capital Management hedge fund. It had used too much leverage as it traded derivative securities with strategies that assumed some market relationships were sure things. The Fed had to step in to persuade — some might say force — the big banks to bail out the fund.

As share prices rose in the 1990s, many concluded that the stock market was a sure thing, at least in the long run. A book called “Dow 36,000” became a best seller. People quit good jobs to join start-ups, hoping that stock options would make them rich when their new employer went public. Silicon Valley won a bitter battle to keep company books from having to reflect the real value of the options being handed out, arguing in essence that the party might end if that happened.

Executives at more than a few companies — Enron and WorldCom being the most notable — cooked the books to allow themselves to share in the riches.

When share prices of high-flying technology and telecommunications companies collapsed in 2000 and 2001, the scandals led to passage of the Sarbanes-Oxley law, which for the first time created a regulator to pay attention to the auditors, whose work had been woefully inadequate. Wall Street analysts faced new rules on the theory that they had promoted stocks they knew were worthless.

But few wanted to mess with the financial engineers.

Instead, their standing only grew. Bank capital rules came to allow the banks to use their own — presumably sophisticated — models to calculate how much capital was needed for any asset they owned. Countries like Ireland and Iceland developed large banking systems and were hailed for finding high-paying, nonpolluting jobs.