Moral hazard
 Moral hazard(Financial concept, undue risk reduction)   | |
|---|---|
| The "too big to fail" meme, giving an unfair advantage to entities which already have more power and assets than the "others who are NOT to big fail". |
Moral hazard means the awareness of big players when they take risks and loose, they will not have to take the consequences or assume responsibility for their behavior.
This effect is incorporated in mathematical models for risk assessment, meaning: a statistical, long term unfair advantage which translates in tilting the zero sum game of the stock markets irrevocably towards those bailed out.
"Too big" players have other unfair advantages, like reduced taxes and insider information. Taken together these advantages translate into statistical winning scenarios ending in unlimited power to influence and coerce policy - which is another unfair commercial advantage, in other words: a self-fulfilling prophecy is created when risk is not evenly distributed in the market.
