Posted on 07/21/2010 10:42:44 PM PDT by TigerLikesRooster
/snip
PIMCO is the latest to launch a Black Swan product, though of course it's Mr. Black Swan himself Nassim Taleb who has been at this the longest, with his various funds (Empirca, and now Universa, which he advises) designed to pay off in the event of an extreme event.
There's a lot to be skeptical about here, quite obviously. For one thing, as Felix Salmon recently pointed out, designing these products are really, really, hard, since even if you can basically predict the crisis, knowing how various assets will actually move in the event of them is dicey, at best.
/snip
(Excerpt) Read more at businessinsider.com ...
P!
Black Swan laying a golden egg?
The trick is getting them to pay off after the market freezes.
Oh, they’ll gladly write you a check for worthless dollars.
Just taking a page from the democrats handbook. Create a fake crisis, then offer protection from it for a fee.
No, you have it backwards.
With Democrats, you first create the protection (the solution) and THEN the crisis (the problem).
In that manner they have saved us before we needed to be saved. Pretty smart isn’t it?
I’m waiting for the mandatory national asteroid insurance pool that will protect us from “the killer asteroid.” I won’t have to wait long though, “The One” will probably hear of the idea from FR spies and it will become a national tax.
If the risk of them paying out gets too high, the market freezes.
Black swan insurance can’t work. There’s no way to quantify how they will play out.
These games of financial chicken (see who turns last but not too late) need to stop.
The trick is getting them to pay off after the market freezes.
tell me about it
Black Swans are inside traders, front runners, market manipulators. The Mad Max of Wall Street Anthony Elgindy is a Black Swan (con); along with his partner, a crooked FBI agent (insider). Do you think that this Black Swan insurance might possibly be an undercover federal investigation? A sting?
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.