Sec. 21] THE RISK ELEMENT 295

he is not financially interested, or over-insures one in which
he is."
The range to which insurance can apply is always limited;
 but it is constantly being extended, as business men
learn how to bring risks of any kind on to a statistical
basis and to apply the theory of probability. At present
the total assets of life insurance companies alone in the
United States are nearly $3,000,000,000.

§ 21

Where risks cannot be reduced to a statistical basis,
and therefore cannot be insured against, recourse is often
had to the shifting of the risk into the hands of those
who are willing to take it. Such persons are speculators,
A speculator is usually one in whom the caution factor is
not so pronounced as in the ordinary individual. In extreme
 cases he tends to become a simple gambler. The
distinction between a speculator and a gambler, however,
is usually fairly well marked. A gambler seeks and makes
risks which it is not necessary to assume, whereas the speculator
 is one who merely volunteers to assume those risks
of business which must inevitably fall somewhere. A speculator
 is also usually fitted for his work by special knowledge,
so that the risk fo him, owing to superior foresight, is at the
outset less than it would be to others. The indiscrimispeculation,
 which is so often met
with, is beside the point ; for, were there no speculators, the
same risks would have to be borne by those less fitted to
bear them. The chief evils of speculation flow from the
participation of the general public, who lack the special
knowledge, and enter the market in a purely gambling
spirit. In addition to suffering the usual evil consequences
of gambling, they produce evil consequences for the nonparticipating
 public by causing factitious fluctuations

1 For the moral effects of insurance,
A. C. Campbell, Putnam’s, 1902.

nate prejudice against all

see Insurance and Crime, by