What are “black swan” events in finance and business? These are highly improbable events that occur despite all we do to prevent them. This reflects the fact that there are rarely any black swans to be found in nature.
So, we wisely keep attempting to protect ourselves against future black swan-type debacles.
We’re spending a fortune to do so. The U.S. Congress, with its propensity to spend, is great at outlays. The Dodd-Frank legislation is a perfect example of over-action and resulting unintended consequences; yet you can be certain they will not prevent the next black swan incident.
One objective of Dodd-Frank was to make banks smaller, not too big to fail. The result is that smaller banks cannot exist amidst the new regulation, and larger banks are getting ever-larger. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at Twitter.)
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