Blog: Free Markets Need Uncertainty
Free Market uncertainty creates long-term opportunity and short-term risk.
Uncertainty is often called the enemy of markets. But is it really? It seems that way for investors, but what would happen if we took uncertainty out of the markets?
I think we can all agree that we're now in a period of unusually high uncertainty. In these times, I think its important to be aware that complex systems like the markets and capitalist economies need randomness and uncertainty to adapt and evolve, generating the fractals we discussed last week. Without uncertainty complex systems die. Uncertainty is not risk, which is what individual investors face. Risk to investors is the risk of loss. Uncertainty, on the other hand, is merely the unknown. Uncertainty, and the opportunity it presents, keep markets moving forward.