Designing good regulation requires a good knowledge of the systems to be regulated. In this video, Franklin Allen argues that we still have an imperfect understanding of systemic risk leading to difficulties in designing effective regulations. One of the problems stems from the fact that regulators still think in terms of macroeconomics instead of focusing on the financial side. This video was recorded at the 18^th March 2016 conference on Financial Regulation organized by NIESR and held at the Bank of England.