Black Swan Economics

Nassim Taleb Calls Dodd-Frank Created Office "Soviet-Style"

By R. Wenzel

Nassim Taleb, one of the witnesses at a recent congressional hearing, described the Dood-Frank Act created, the Office of Financial Research, an attempt to create “an omniscient Soviet-style central risk manager.”

In his testimony,  according to WSJ, Taleb said that “[f]inancial risks, particularly those known as Black Swan events cannot be measured in any possible quantitative and predictive manner; they can only be dealt with [in] non predictive ways.” He argued that trying to do what the OFR is designed to do could actually increase risks, in part by increasing “overconfidence” in the information’s ability to predict the next crisis.

Go Nassim! Let's hope you bring the same candor to the IMF..