The default of a clearing member would likely shake confidence in the clearinghouse's ability to manage counterparty risk, leading to greater perceived risk in the market. This increased counterparty risk may lead other market participants to hold back from trading, leading to a decrease in market liquidity. This is the most immediate and direct consequence of the clearing member's default.

A is incorrect. While a default might increase market uncertainty and potentially lead some investors to shift towards safe-haven assets, this is not the most direct or immediate consequence of a clearing member's default.

B is incorrect. While a major default might potentially affect interest rates, it would not be an immediate effect, and the impact would depend on many other factors such as central bank policies and overall market conditions.

C is incorrect. Increased regulation isn't an immediate or direct effect of the default. Regulatory changes usually occur over longer time frames as they require a comprehensive understanding and assessment of the situation, drafting of new regulations, public commentary, and then eventual adoption and enforcement of those regulations.