Doug Comment: Actually Keynes wrote on this topic first as a philosopher of probability in his Treatise on Probability, ahead of his General Theory . He was thinking of the individual as a decision maker and not of economies yet. But in any event, the partially managed economies of the capitalist west have suffered from successful attacks on the dismantling of this apparatus since the 1980's, not the other way round, as a wave of deregulation took place increasing general investment risk levels. Evidence of this abounds in the numerous currency crises in Mexico, Argentina, SE Asia and Russia in the 1990's motivated by the introduction of flexible exchange rates and the liberalization of capital flows. Locally this can be observed in the cases of the S&L crisis, the bankruptcies of LTM Capital and Enron, the Telecom and Tech Bubbles in the 1990's,the current Housing Bubble, etc. True, the State through the central bank acts,occasionally , as rescuer of last resort, but it is acknowledged this only increases "moral hazard" encouraging excessive risk taking, especially as the economy has turned to be dominated by the financial sector.The increase in importance of "risk management" firms and specialists plus the growing number of hedge funds and the continuous expansion of new financial instruments such as the derivatives,MBS's,ABS's,etc, is vivid testimony of the widespread level of risk taking in the economy. Actually, Floyd Norris was pointing out in last Sunday's NYTimes how Greenspan is turning American workers into gamblers vis the mortagage bubble and the possible privatization of S.S. Cristobal Senior -------------- next part -------------- An HTML attachment was scrubbed... URL: <../attachments/20050729/129eba1d/attachment.htm>