Submitted by Taps Coogan on the 11th of December 2018 to The Sounding Line.
Legendary trader, risk analyst, and author, Nassim Taleb, recently spoke with RiskMinds International about economic and structural risks facing the world economy today. Mirroring his warnings before the 2008 financial crisis, Nassim Taleb cautions about high levels of debt and rising moral hazard.
“The economic risk is quite acute in that we have much more debt than we did ten years ago, and ten years ago… we had a crisis. So it’s like we cured a debt crisis with debt. So we have an accumulation of debt and it’s not very good. We also have an increase in moral hazard in the system. In other words, people gaming the system… So we have to worry about it… People are still unable to realize that there should be no risk management. You should study risk taking, not risk management, because we cannot separate the income generating technique from the risk associated with it. They’re not separable. It’s the same decision making and they should all be in the class of ‘decision making in uncertainty…’ You have to worry about an industry dominated by non-risk takers discussing risk…”
There is much more to the interview so enjoy it above.
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