Hegel and financial history - Don't Look for some linear process

We are facing another banking crisis. The same financial and banking mistakes are being repeated as institutions assume that the past will continue well into the future. Hence, banks bought long-dated assets with short-dated deposits and took the asset liability mismatch. Regulators fight the last battle and again miss the crisis that is facing them, blind to the obvious because coping is painful. Policymakers have the hubris to think they can forecast the future and have the tools to solve any problem. Again, they are being proved to be mistaken.  

Technology may be progressive, but the decisions of market participants do not follow a process that learns from the past. For Hegel the great 19th century philosopher, history is an intelligible process that moves toward a specific condition, design with purpose. The purpose is to have the freedom to pursue principles and moral law that look beyond personal desires. Nevertheless, he was pessimistic about whether anyone can learn from history. 

Hegel was not a financial historian. When we contrast his view with current financial behavior, there is little progress from learning and little linearity. Lessons are either forgotten or never learned, so there is constant cyclicality and repetition with financial markets.

This cyclicality may not be exploitable in the sense of being forecastable; however, it can be useful for seeing the financial world.  Assume that the behavior mistakes of the past will be repeated on both a micro and grand scale. 

On the micro level, assets prices are driven by behaviors biases. On a broader levels financial crises are driven by market excesses. Economies will go through business and credit cycles. World orders will change with dominance lost through a well-defined cyclical process. Accept cycles and end linear thinking and your investment decisions will be better.