Yesterday, Ken Posner, author of Stalking the Black Swan: Research and Decision Making in a World of Extreme Volatility, was a featured guest on CNBC to discuss his book and how the government, financial institutions, and investors can best prepare themselves for the next “black swan.”
Posner expressed some skepticism about the proposed financial reform bill, worrying that it might lead to micromanaging. Instead, what is needed, are financial reformers and regulators with the power to act decisively and quickly when an unpredictable event or “black swan” occurs. He also warned against the rising level of debt, which is a source of volatility. Other suggestions Posner made included the creation of more rating agencies to break up the monopoly of information held by Moody’s and S & P.
Here is a clip of Posner’s appearance: