One day they remove the safety net, and people aren’t even aware of it until they hit the ground. From Charles Hugh Smith at oftwominds.com:
So when the gambler ends up juggling lit sticks of dynamite, he’s confident nothing bad can happen because nothing bad has ever happened, no matter how much risk he takes on.
The problem with constantly being saved from the consequences of our actions is this fatally distorts our sense of risk. The foundation of the ability to accurately assess risk is the experience of real-world consequences: hardship and losses.
If you are sloppy about positioning the ladder securely, the ladder falls and so do you. If you survive the fall, you’ve learned that risk is real and that precautions must be taken to minimize risk. Precaution requires thinking through all the components of risk and taking steps to remediate or avoid each specific source of risk.
If you’ve never really been pushed to your limit of endurance, you lack the experience needed to realize you’re dehydrated and in danger of succumbing to heat stroke. So when you run out of water on a shadeless climb exposed to the blazing sun, you fall into magical thinking: if we just push on, push harder, power through this, then we’ll be fine. But powering on is the worst possible choice, and so the inexperienced hiker passes out and expires.
The Federal Reserve and the rest of the Savior State has saved us from the financial consequences of rampant speculation for decades. As a result, few of those in the casino have the necessary experience of hardship and losses to accurately assess risk. The vast majority have only experienced being saved: the most profitable response to a losing bet is to double-down on the next bet because the house (the Fed) will amply reward every “buy the dip.”
