That question almost reads like a criticism, but I'd like to throw my hat into the ring here and say I'd like to know how markets cope in this situation. Do we have real world examples?
Lots of real world examples. Eg Japan and Germany still have lighter regulations on insider trading, and in the US and UK people used to trade before insider trading was banned.
Insider trading probably ought to be thought about when designing regulations---but I am not convinced either way that it should be banned.
