QuoteOriginally posted by: PaulI just spoke to a lady at AIG, it wasn't a very pleasant conversation, and it ended quite abruptly. I asked her about regulations, she started reading some prepared statement, I interrupted and asked "What about statutory FSA regulations?" She replied "I don't know anything about FSA regulations." I then spoke to a much more helpful man at the FSA. But again the conversation was far from ideal, "AIG have thousands of products, we can't know about them all."I've always said that rules and regulations are there to protect the morally guilty. I am seeing more evidence of this every day.PI'm reminded of some research using simulated agents and genetic algorithms in an iterated prisoner's dilemma world. In one of the runs of the simulation, the agents in the population evolved a rather nasty quasi-stable strategy. They spontaneously evolved a mutually synchronous cycle of Cooperate-Cooperate-Cooperate-Defect. Although this strategy slightly reduced the returns among the population's long-time residents (when they played against each other) it reaped huge profits against the steady flow of newcomers in the simulation (i.e., the newcomers == greater fools did not know when to defect). It's not unlike the poker parlor strategies that Aaron Brown discusses in his book -- the parlor professionals modulate their play to consistently profit from the amateurs (albeit while ensuring that the amateurs have fun losing).Leaving morals aside (which seems to be the sad trend du jour/du ans/du siecle), it appears that the only rational strategy with a "house-always-wins" world is to join the house. Although cynical, the strategy may actually be, in the long-run, socially beneficial. If "house-always-wins" motivates people to join the house, that would seem to improve social cohesion in the long run (as long is it doesn't fail from short-term internal social divisions or colonialist-style external wars). That brings us back to the second-order strategies of the poker parlor professional -- its OK to exploit the masses as long as the masses have enough fun in the process and are not so disillusioned by the outcome that they refuse to play in the future.