Risk is not a physical quantity and as such doesn't exist in nature. It is not subject to any laws of physics.
The question is than can it be measured and managed?
If the past is the future as to historical price movements of various asset classes, it can be accurately measured in terms of expected return and standard deviation. But alas those who think the past is the future are misguided, particularly since the data points with any accuracy only go back to 1926, and beyond that, the US in particularly came out a "winner" during that period relatively speaking, and along with it, the industrial democracies after WW II. If that had not happened, the past would have been far different.
One problem going forward, is that after most folks in India and China join the market economy, and then get old, with an aging population worldwide, with relatively more olds than working youngs in the market economy, the real return on capital is going to go down, because the relative choke point will be labor, not capital.
