US Financial World War (Part 5): Nassim Taleb spells it out AGAIN…
Monday, 15 November, 2010 Leave a comment
Is Bernanke merely implementing a “Nick Leeson strategy” by gambling with the retirement funds of Pensioners and our future generations – socialising debt? I think so and so do plenty of other people better qualified to comment than I.
It is understandable that NNT cannot hide his frustration!
When US should be working toward ensuring robustness [resilience] they are, almost certainly, creating fragility.
Will this come to be known as the biggest self-serving act in economic history?
On the off chance that someone taking the time to read this blog (thanks) doesn’t already know who NNT is these will give you some clues as to what he is about. He developed ten principles to help make societies more robust to Black Swan events:
1. What is fragile should break early while it is still small. Nothing should ever become Too Big to Fail.
2. No socialisation of losses and privatisation of gains.
3. People who were driving a school bus blindfolded (and crashed it) should never be given a new bus.
4. Do not let someone making an “incentive” bonus manage a nuclear plant – or your financial risks.
5. Counter-balance complexity with simplicity.
6. Do not give children sticks of dynamite, even if they come with a warning.
7. Only Ponzi schemes should depend on confidence. Governments should never need to “restore confidence”.
8. Do not give an addict more drugs if he has withdrawal pains.
9. Citizens should not depend on financial assets or fallible “expert” advice for their retirement.
10. Make an omelette with the broken eggs.