Perhaps Minsky's ideas have some use here. The basic notion is that what we see as the financial gaming is essentially unstable. Yet, a whole industry has arisen the past few decades to support the gaming and to try to put a rational face on it.
Well, folks. Let me remind you that this infrastructure is of recent heritage; the more advanced aspects of it required computers and securitization (already noted as suspect). The one truth of the whole thing is that the mechanisms have helped oodles of monies to flow from the pockets of the hapless to those of the favored few (those with the wherewithal and capital to attempt the gaming 'wins' (very much a zero-based game)).
This blog has noted such a characteristic may occur with programs and projects, to boot.
So, key factors are stabilization, how we obtain this, and what constitutes reasonable variations (and, yes, frothy-ness and volatility).
Remarks:
08/01/2013 -- Ben cannot unwind or taper down; he has too many Doves. We'll have to get back to the king thing (yes, the divine rights of the CEO, new royalty, in other words) and dampening of these types by a new outlook (Magna-Carta'ísh).
05/22/2012 -- FB will be a focus for discussion.
01/26/2009 -- Now a new day and way to consider these matters.
12/13/2008 -- Much water has passed under the bridge. But, new types of revelations continue to arise.
11/26/2008 -- The mess grew and grew, fairy dusting indeed.
08/19/08 -- In reviewing the types of gaming done in finance, one has to wonder if Minsky's model has some parallel with the phase changes that we see in matter.
Modified: 08/01/2013
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