Keynes said it before us

Someone named Robert Skidlesky wrote a book called John Maynard Keynes: 1883-1946: Economist, Philosopher, Statesman. He says that Keynes said "not all future events could be reduced to measurable risk. There was a residue of genuine uncertainty and this made disaster an ever-present possibility, not a once-in-a-lifetime 'shock'. Investment was…

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Elise Payzan Le Nestour on “The Brain on Risk”

On The Ubiquitous Missing Information in Markets: What Neuroeconomics Has to Say 'Ambiguity' is the Hallmark of Trading and Investing The situation of taking a position when the odds are uncertain because of missing information is referred to by economists as "ambiguous". F Knight in his book Risk, Uncertainty, and…

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Shiller, Negative Affect & Psych Cap

Robert Shiller writes in the New York Times about the role of group-think during the upward phase of our blown-up housing bubble. He recounts the polite discounting of his warnings in Irrational Exuberance (see all of Shiller's books) and says "speculative bubbles are caused by contagious excitement." He segues to…

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