So should re-hypothecation of assets be banned.

Forgive me if I use the wrong term, or use it incorrectly. I have only a cursory understanding of this.

Here is a cut/paste from this letter:

In his groundbreaking book The Great Taking—which galvanized many of the questions that inspired our research into the UCC—David Rogers Webb explains:

Essentially, all securities ‘owned’ by the public in custodial accounts, pension plans and investment funds are now encumbered as collateral underpinning the derivatives complex, which is so large—an order of magnitude greater than the entire global economy—that there is not enough of anything in the world to back it.

The illusion of collateral backing is facilitated by a daisy chain of hypothecation and re-hypothecation in which the same underlying client collateral is re- used many times over by a series of secured creditors. And so it is these creditors, who understand this system, who have demanded even more access to client assets as collateral