In today's Financial Times, black swan theorist Nassim Nicholas Taleb lists 10 ways to prevent cataclysmic and unpredictable economic events like ... this one.Taleb's general argument is that our economy should be composed of many small entities rather than a few behemoths capable of taking down the whole system. Most of his points feel like common sense by now ("nobody understands [complex derivatives] and few are rational enough to know it"). Others really should have been common sense in the first place ("Nothing should ever become too big to fail"). One suggestion stands out:No socialisation of losses and privatisation of gains. Whatever may need to be bailed out should be nationalised; whatever does not need a bail-out should be free, small and risk-bearing. We have managed to combine the worst of capitalism and socialism. In France in the 1980s, the socialists took over the banks. In the US in the 2000s, the banks took over the government. This is surreal.The nationalization debate has died down some, and the Union of Soviet States of America fear-mongering (hopefully) reached fever pitch last month. Still, Taleb's point should be remembered moving forward. Presently, government receivership is not equivalent to the wholesale exploitation of free enterprise, and it certainly doesn't signify the dawn of a Castro-style regime. Instead, it just means that the taxpayer is on the hook for banks' losses while the only institution capable of even attempting to solve this economic mess tries to do so. --Alexandra Gutierrez
