Sunday, February 26, 2012

On Risk and Uncertainty

This is a placeholder more than anything else.

Some other things that struck me as ideological in CHS's Survival+ are the unfounded assumptions that (1) free market capitalism is not only possible but existed in the past, (2) the middle class has always been a part of civilized human existence, (3) prices are determined by supply and demand, and (4) transparency will ensure the proper operation of the free market.  I don't see any evidence for item (1).  Item (2) is marred by CHS' conception of the middle class he grew up in, which was the result of massive State intervention into the normal operation of laissez-faire captialsm.  Item (3) fails to account for the fact that both supply and demand can be artificially manipulated (as is happening every day these days in the financial markets).  As to item (4), that's a fantasy as financial "innovators" (read fraudsters) can and do invent new fraudulent offerings to avoid transparency obligations.  In any event, there is a difference between being transparent and sharing insights and information that only you have.