For the nonorganic, noncomplex, say an object on the table, equilibrium happens in a state of inertia. For something organic, equilibrium is synonym to death.
[Chapter on Political Volatility]
For the nonorganic…
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Category Archives: John
The continuation of Seneca’s asymmetry
[Unfortunately the link is broken. I don’t have the pdf and NNT is pretty clear about not sharing the documents he posts to FooledByRandomnexx.com anyway.]
The continuation of Seneca’s asymmetry: “Fragility is the new blue”. I need to find the person who wrote it to give proper credit.
http://www.fooledbyrandomness.com/fragility-blue.pdf
The entire idea of via negativa…
The entire idea of via negativa is that omission [avoidance of harm, removal of drugs, corn syrup, cigarettes, gluten, carbs by fasting, gym instructors, tail risks, etc.] does not have side effects and branching chains of unintended consequences -hence robust. But big corporations [evil pharma, pepsi] and consultants cannot make money from removing; they only benefit from adding.
End Deposit Insurance, Not Bonuses – By Reihan Salam – The Agenda – National Review Online
[Another commentary and rebuttal to NNT’s recent NYT ‘End Bonuses for Bankers’ piece. Again, it would be nice if these articles were based on the larger context of NNT’s entire Bailout commentary rather than a single opinion piece. JH]
End deposit insurance: a simple heuristic for a complex problem. Taleb of all people should appreciate that we need firms to have the freedom to pursue a variety of different organizational strategies to survive and flourish. If the problem is excessive risk-taking, and I think it may well be, deposit insurance pours fuel on the fire. Eliminate it for large financial institutions and the competition won’t be over which can make the biggest bets, but rather which can attract the most depositors by being as stodgy and risk-averse as possible. The bonus “problem” will solve itself.
Link to full story: End Deposit Insurance, Not Bonuses – By Reihan Salam – The Agenda – National Review Online.
HatTip to Dave Lull.
No, Wall Street Bonuses Aren’t Destroying the Economy – Daniel Indiviglio – Business – The Atlantic
Going Back to the Partnership StructureTaleb suggests that investment banks go back to what they used to look like a few decades ago — where they were partnerships instead of publicly traded companies. This idea does have some attractive features, as the employees all share in the losses. But that also makes it somewhat unattractive for certain employees: if one trading group has a miserable year, then everybody suffers.Here’s the problem: investors love financial firms. Taleb oddly points to the recent failure of MF Global as an example of the dangers of excessive risk-taking. But that situation actually demonstrates exactly what should happen. A financial firm took big risks that went bad, and it failed. Its investors lost money. No investor was coerced to put money into MF Global. If they didn’t like risk taking, then they could have invested in a utility, a Dow component, or a U.S. Treasury. They knew what they were getting into and wanted a chance to reap the significant return that a company like MF Global offered.
[The article suggest to me that the author isn’t familiar with NNT’s various commentary on the banking situation. Certainly NNT doesn’t suggest that curbing bonuses alone will fix anything, and he has been one of the loudest proponents of getting rid of banks that are ‘too big to fail’ since the crash began. See: Ten principles for a Black Swan-proof world Published: April 7 2009 20:02 JohnH.]
Full Article: No, Wall Street Bonuses Aren’t Destroying the Economy – Daniel Indiviglio – Business – The Atlantic.
Hat Tip to Dave Lull.