Expected Value of the Risk

Going forward, what is the expected value of the risk?

With the Great Recession empirically defining social class by income (the ability to increase net worth), for any investor that is not in the top two quintiles, trying to increase your income is largely a function of protecting it from the "systemic risk."

The strategy will be defensive for all income classes. We all have to protect ourselves from the high accumulation of gamma risk. We are all looking to government to protect us from its overaccumulation.

The more value accumulated (the higher your net worth), the more able to protect yourself from the gamma risk exposure (the ability to "cover" your losses and stay solvent). Too-big-to-fail banks should be insolvent, but the government defended their creditworthiness at the expense of millions of people.

By what standard are The People legitimately deprived of adequate income and housing?

The ontology of the business cycle--the process of free-market mechanics--is argued to be the objective determinant of distributive value (who takes the risk, who accumulates the reward, and why).

So, then, it is absolutely critical to objectively (non-ideologically) answer the question: are we operating with a free market?

Risk that is fully valued in a gamma proportion (relying on government protection) indicates the opposite of a free market.

If the market is not free, what do we have to do to make it free?

If there is one thing we should rely on government to protect and defend in priority, as our founders envisioned and we still regard with both an idealistic and Constitutional measure, is to ensure freedom. That especially includes ensuring a free-and-unconsolidated marketplace in priority--exactly what defending and protecting consolidated, too-big-to-fail, economy-of-scale firms is not.

An economy-of-scale deprivation is not to be politically, legitimately, protected and defended, but that is exactly what We The People have. All that does is consolidate the gamma risk, causing the instability that our founders sought to avoid--causing the need for government (the king, or that is, the consolidation of sovereign power and the consolidation of risk).

The expected value of "the risk" is reduced to a political evaluation--a critique--that formulates a confirmable hypothesis despite all attempts not to. "The risk" of a confirmable hypothesis is improvement, something the socio-economic elite will politically avoid at all cost, including a more progressive tax code.

It is not the progression of the tax code that is the determining variable, but what We expect to do with the value accumulated.