By the way, the Fed graph I sent is a display of a "black swan," as the popular term goes in these days. But I think, most people misinterpret what a black swan is and Taleb, with his rhetoric, is contributing to this misunderstanding. Black swans are rare, but not necessarily as rare as many think what Taleb means by rare. How rare the black swans are depends on the system that generates its own black swans. This financial system generates a black swan every few years. The major problem is that most current economic/financial economic theories imply that black swans are once in a life time events, if not every billion years. This takes us to what Michael P claims: this system is inherently unstable, generating a black swan way more often than any conventional theory implies. For example, in the currently quite popular "disaster research," such events occur every 50-60 years (which are aggregate demand and/or supply shocks in that theory), although this contradicts what is happening in the financial markets.
This is why I am so fond of Minsky! Best, Sabri _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
