In the 1920s, an economist named Frank Knight made the crucial distinction between risk, which markets know how to deal with, and uncertainty, which they don't.

Risk is what you face when you have a basic understanding of how things work but there's a degree of randomness or luck involved.

Uncertainty is when you're really just stumbling around in the dark. And right now, there's an awful lot of stumbling around in the financial markets, with little idea of what comes next.

http://www.businessweek.com/investor/content/aug2007/pi20070817_231912.htm?chan=top+news_top+news+index_businessweek+exclusives