Australian Securities and Investments Commission (ASIC) chair Tony D'Aloisio said on Wednesday that closely regulated investment markets were more likely to smooth their way through the onslaught of global financial crisis as against markets with liberal policies on their investment environments.

Speaking before the Australia-Israel Chamber of Commerce and Industry conference in Brisbane, Mr D'Aloisio said that the world market has entered the age of tightening grip on economic regulation after the burnout suffered from the last financial downturn.

He added that the worldwide financial crisis instilled the valuable lesson that markets which were heavily regulated amidst the battering effects of a financial meltdown were bound to perform considerably better and even dodge the debilitating effects of economic contraction such as mounting sovereign debts, runaway inflation and deep recession.

Mr D'Aloisio stressed that in contrast, unregulated markets suffered the inevitable consequences of a severe downturn as he added that the worst that could happen is the crisis could eventually damage a given market's whole financial system.

He said that these are the realities that economic managers are closely considering in pushing for market reforms, especially for those hard hit by the recent global financial crisis as he pointed out that "what you now have globally is a move to re-regulate those markets."

The ASIC chairman said that economic challenges are still ahead for most economies around the world as he underscored that "there were also problems with herd mentality in some of the things that developed and regulation is the way that they're now moving and are likely to be moving for some time."