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Gambling is a feature of capitalism—not a bug

It has always been part of financial markets, from their origins in 17th-century coffee houses to the Great Crash of 2008

By John Kay   April 2017

Bean counters: from its caffeinated beginnings in 17th-century coffee houses, the insurance industry has always been intimately linked to gambling ©Look and learn/Bridgeman Images

In a modern capitalist economy, almost everything is for sale, including risks. Markets can transfer known risks to people or institutions who can handle the risk more effectively. The cost of rebuilding my house if it is destroyed by fire is beyond my means. For an insurance company with many properties on its books and many shareholders, by contrast, the loss is easily manageable.


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