The development and growth of the financial sector within the last 50 years has been justified on the grounds that new instruments and greater levels of trade result in a more efficient allocation of risk. The experience of the Great Financial Crisis punctured this narrative, but much of the policy response has focussed on establishing new and more complex regulations. This misunderstands the nature of risk and uncertainty in the financial system and the real problems of complexity that arise in these types of systems. An analysis of the history of financial development highlights where socially harmful approaches have grown into destabilising practices.