capitalism 2.0 [View All]

[RainDog]

Capitalism 2.0 is the term Nassim Nicholas Taleb used last night on Charlie Rose to talk about the near future - near as in the lifetimes of some of us, I assume. He also wonders if we're not at the beginning of this entire financial crisis (as do many of us.)

He thinks things might be worse than Roubini expects.

http://www.charlierose.com/guest/view/6133

He says he doesn't like forecasts, but of course anyone discussing economics is questioned about these very things. What Taleb wants to say is that we do not understand the world and we shouldn't trust those who claim they do - his big example is comprised of the economists telling banks they could ignore long-standing risk assessments in investments.

According to Taleb, Capitalism 2.0 will view banks as utilities. People will no longer tolerate the current system in which stock brokers, banks, magacorps, etc. are allowed to take risks and get bailed out by the government. (Taxpayers as hostage investors.) Markets are stupid - and analyzed by stupid 35 year olds who pretend they know more than they do.

He had been warning about banking risks for 12 years - here he's talking about the economists who tried to ignore him - and the problem with banking.

http://www.youtube.com/watch?v=ABXPICWjFIo

Taleb says that people should hold 90% of their assets in cash and only 10% in stocks. He thinks we are in for a deflationary period, stock investments will not be favored and hedge funds still have a ways to fall.

Taleb 8 mos ago - http://www.youtube.com/watch?v=NITNKzWYOqc

Becoming wealthy = skills but more importantly, luck.

(the youtube links also have links to other Taleb interviews.)

I wondered what you guys in the econ jungle thought of him.