The Senate recently held a hearing to look into a series of trades that cost JPMorgan Chase over $6 billion last year, some of which was funded by federally insured deposits. They have come to be known as the “whale trades,” but beyond indicating the scale ofthe loss, the description is a misnomer. You see, likening whales to rogue traders is unfair to whales. A more accurate metaphor is the Siberian tiger, one of the most awesome creatures on earth.
The Siberian tiger was brilliantly engineered to be the world’s ultimate killer, far surpassing the shark, the barracuda and the piranha. Tigers kill with their fearsome combination of size, speed, strength and cleverness, not to mention razor-sharp claws and teeth.
But tigers don’t kill just to meet the Darwinian imperative of satisfying their ravenous hunger. They also kill for the sheer joy of it, preferably while inflicting the maximum amount of torture on their terrified victims. It’s just their nature.
An example of this occurred on Christmas Day 2007 at the San Francisco Zoo, when three teenage boys who had consumed too much beer thought it would be great fun to yell taunts and obscenities at Tatiana, the zoo’s 400-pound Siberian tiger, from outside her enclosure.
After the boys had tired of the game and started on their way, Tatiana sought vengeance. She leaped to the top of the 12-foot wall surrounding her enclosure, hid behind some bushes along the pathway she figured the boys would take, and leaped at them with a mighty roar as they passed.
Tatiana killed the first boy instantly with a bite to the neck . She whacked the other two into semi consciousness with blows from her powerful front paws. But as she set upon them, a team of zookeepers reached the scene and killed Tatiana with a shot to the head from a high-powered rifle, saving the lives of the remaining two boys.
For all their strength, intelligence and murderous instincts, Siberian tigers are in danger of becoming extinct in their natural habitats, because each adult requires roughly 400 square miles of unspoiled wilderness stocked with tasty animals to survive on its own. A burgeoning human population and development pressures are making such outsized land hunger increasingly impractical.
So the best future for Siberian tigers is in regulated environments like the Bronx Zoo’s Tiger Mountain. There they can roam large wilderness compounds that replicate their natural habitats as they are fed fresh meat daily so they no longer have to kill other animals. They are tended by skilled keepers who entice them into playing games that delight human spectators and maintain their physical fitness and fighting instincts without requiring them to indulge in the worst aspects of their serial-killer nature.
In many respects, markets are also serial killers. From a social perspective, the best future is for them to also exist in regulated environments where their survival is pretty much assured, their many benefits can be harnessed to serve the public good, and the downsides of their nature are properly restrained.
As the financial meltdown of 2008 reminded us, under-regulated markets have a long history of going on periodic murderous rampages, just like hungry tigers. They rip jobs and homes away from millions of people who depend on them, gulp down trillions of dollars in hard-earned savings, and ravage the flesh of thousands of small businesses whose bones are flung on the ash heaps of bankruptcy.
There are two possible solutions:
One is to learn how to regulate markets and their participants sensibly, to rein in their potentially murderous behavior before it gets out of hand by building a system in which the ups and downs of capitalism are sufficiently tempered to avoid destructive booms and busts.
You don’t want to know what the second solution is. But if you happen to be an immigrant from the former Soviet Union, you already know what it’s like to be subjected to absolute state authority.
originally published: March 23, 2013