If we care about universal principles such as freedom, democracy and the rule of law, we cannot leave them to the care of market forces; we must establish some other institutions to safeguard them.

Discount the obvious, bet on the unexpected

Hedge funds are a very efficient way of managing money. But there are clearly some risks. Hedge funds use credit and credit is a source of instability. Transactions involving credit should be regulated.

This is the joint responsibility of everyone who was involved in the introduction of the euro without understanding the consequences. When the euro was introduced, the regulators allowed banks to buy unlimited amounts of government bonds without setting aside any equity capital. And the European Central Bank discounted all government bonds on equal terms. So commercial banks found it advantageous to accumulate the bonds of the weaker countries to earn a few extra basis points.

I would be lying, however, if I claimed that I could always formulate worthwhile hypotheses on the basis of my theoretical framework. Sometimes there were no reflexive processes to be found; sometimes I failed to find them; and, what was the most painful of all, sometimes I got them wrong. One way or another, I often invested without a worthwhile hypothesis and my activities were not very different from a random walk.

An open society is a society which allows its members the greatest possible degree of freedom in pursuing their interests compatible with the interests of others.

If truth be known, I carried some rather potent messianic fantasies with me from childhood which I felt I had to control, otherwise I might end up in the loony bin. But when I made my way in the world I wanted to indulge myself in my fantasies to the extent that I could afford.