Goldman Exec Says Enough Already With The Black Swan Theory

Jim O'Neill, chairman of Goldman Sachs Asset Management, pauses during the Retail Week conference in London, U.K., on Wednesday, March 16, 2011. The U.K. economy will be challenging for retailers this year as consumers wrestle with government austerity measures and higher value-added tax, chief executive officers of some of the nation's biggest retailers said today. Photographer: Simon Dawson/Bloomberg via Getty Images Photo: Bloomberg/2011 Bloomberg

A recent Bloomberg poll found that global investors are gonna wait and see how the Western world pans out. Over the next six months, investors are planning to hoard cash rather than funnel it into stocks, following the black swan theory popularized by Nassim Taleb. The theory holds that events that deviate from the norm, like say uprisings in the Middle East or another global financial contagion, are hard to predict. But Jim O’Neill, chairman of Goldman Sachs Asset Management, thinks everyone should stop seeing the damn bird everywhere they look.

“Every little problem that crops up somewhere in the world is not going to create another black swan,” he said, adding that “there’s far too much conservatism,” in terms of investors holding cash.

O'Neill also said the view that “the West is in trouble” is wrong and predicted China will "go crazy" starting off a stock rally later this year. And hey, if you want to pull the cash out of your mattress, maybe that new yuan-dominated private equity fund Goldman's rumored to be starting in China would be a good place to put it.

Goldman’s O’Neill Says ‘Black Swan’ Fears Overblown, Stocks Set to Rally [Bloomberg]