John Maynard Keynes described a complex idea with a simple word. He called it uncertainty. It took an American, Frank Knight, to split hairs (or simplify matters, depending on your persuasion). He distinguished risk from uncertainty.
Today, matters are more complicated. On Thursday, Federal Reserve chairman Ben Bernanke added a twist in the tale by saying the US economy faced “unusual uncertainty”. He did not explain the adjective “unusual”. But then that was in the US Senate, a body with a keen ear for detail.
Perhaps this has more to do with American psychology and its obsession with assurance flowing from precision and less with realities of a complicated world. Some years earlier, US defence secretary Donald Rumsfeld said there were “unknown unknowns” and “known unknowns”. He was only updating Knight for the 21st century.