I have rarely spoken about this in my 25 years of teaching and never wrote about it until now, as the Wall Street meltdown unfolds before our eyes.

I discovered a rule that I call the "Lethal Jackpot." Simply stated, it says that in most accidents there are not only one or two things that go wrong; rather, most accidents involve a rare confluence of three, four, or sometimes five, or even seven things that go wrong. The surprising discovery was that if you took any one factor out of the equation, it had the potential to stop the entire chain of events that led to the accident. If one of a series of things that went wrong was intercepted at the right time, the accident would probably be averted. This was a mystifying insight. We know the power that synchronicity and serendipity can grace us with -"Was there such a thing as 'bad synchronicity and serendipity'?" I asked. And if there was, did I have the power to interrupt this bad "synchrondipity?"

My conclusion was definitive. Yes, you can. You can interrupt the Lethal Jackpot pattern and prevent its fatal outcome. Ultimately this is about taking responsibility-taking responsibility for what shows up in your life, and then taking responsibility for your response to it. Most bad things don't happen as a complete surprise. There are signs; there are often a series of premonitions. If you are not in denial, if you do not pretend it is not there, you can often read the writing on the wall and take preemptive action to interrupt and avert disaster.

The Lethal Jackpot insight saved my life on numerous occasions. I bet if you are reading these lines you have successfully averted a few disasters yourself. To win a jackpot you need to get a sequence of things right. If seven is needed and you get six, you do not make the jackpot. In the same way, there is a sequence of things that go wrong to make a plane crash. It is not just the vertigo; it is not just flying too low; it is not just being overly ambitious or being in a hurry and cutting corners. It is a combination of these factors lining up with others that lead to a fatal accident.

I am grateful to be alive. Getting through life requires luck; but it also requires choosing to avert bad "synchrondipity". Applying this insight means you have to recognize a lethal pattern and interrupt it. When you notice something going wrong, and then a second and a third miscalculation follow, you take responsibility to avert, stop, prevent or disengage before the lethal jackpot activates.

Case in point - Wall Street Meltdown
When books are written about the $600 Trillion (with a T) derivative meltdown of Wall Street, they will say it was a rare, once-in-a-100 year or couple-of-centuries confluence of mistakes and system failures that fashioned together a perfect storm. Historians will show that many things preceded what Treasury Secretary Paulson described as "lax lending practices earlier this decade which led to irresponsible lending and irresponsible borrowing." They will show it was more than toxic mortgage-backed securities and credit-default swaps that became "frozen on the balance sheet of banks and financial institutions," where "the inability to determine their worth has fostered uncertainty about mortgage assets and even about the financial condition of the institutions that own them."

A classic air maneuver in dog fighting is spiral descent. You accelerate and turn in a sharp dive to get into a firing position on your opponent. When both you and your opponent are in a hard down-spiral maneuver, one against the other, the danger is in not pulling out of the maneuver in time because the ground is getting close awfully fast. It's a bit like this in financial systems when nobody understands who owes what to whom or whether they have the ability to pay. When all try to stampede out of their positions and get into cash, then credit, borrowing and trading freeze and the financial pyramid implodes.

The Uncertainty Principle And The Velocity Of Money
Modern finance is a bit like quantum physics. Your dollar is like the electron that can be at any number of places at one time. It's called currency because it flows and its value is that it can move from one hand to another, from one account to another. Stop the movement of currency and it loses its value. Financial innovation was based on accelerating the velocity of money. One of the accelerating points leading to this Lethal Jackpot was allowing investment banks to raise debt ratios from 12 to 1 to about 30 to 1. Lehman's debt ratio when it went bust was 30 to 1. As in a spiral descent for a jet fighter, the ground was getting close awfully fast for the people at Lehman. This can be a scary out-of-body experience and it ultimately turned fatal.

The deadly spiral was in part triggered by the Heisenberg Uncertainty Principle of finance. In physics, the Heisenberg Principle says the mere observation of something changes it. OTC shadow derivatives become worthless when they are forced to be marked to market and there is no market. Like with subatomic particles where the power is in their movement, the paper money or computer entry had no intrinsic value - it was the continual flow of transactions that created its value. Uncertainty stopped the flow, which became the final trigger of this deadly spiral. Series of events over more than three decades lined up and the final trigger activated the Lethal Jackpot.

Chosen Ignorance
This uniquely rare case in point reveals the anatomy of the Lethal Jackpot. It is a sequence of mistakes, each one with a profile of chosen ignorance, denial and refusal to take responsibility:

1. Senior managers did not understand the convoluted financial models and the complex investment vehicles enabled by sophisticated computing power. They were disconnected from the inner workings of their companies and believed their own BS.
2. Younger, brilliant math graduates developed these sophisticated risk formulas and unleashed the computerized black-box power in trading that accounted for multi trillion-dollar derivative swaps. Yet they had no institutional memory or fundamental knowledge of the great depression or the financial crisis of 1907.
3. Regulators and lawmakers did not want to know or understand what kept the party going because they enjoyed it, too; the money was too good.
4. The media colluded in this by reducing everything to the simplest sound bite and then believing its own hype.
5. The general public chose to not be responsible for understanding how it all works. Ignorance lets you off the hook. You can then participate in the "hero and villain" blame game. We love our celebrity superstar CEO heroes. We buy their books, admire their many excesses in colorful magazines and then vilify them for all the bad things that happen.

This game of chosen ignorance is a classic Lethal Jackpot pattern. Proliferation of fiat currency is how the US government now finds itself with a $9.5 trillion debt, the need to raise the debt ceiling to $11 trillion, and $53 trillion in unfunded liabilities. When you borrow from tomorrow to pay for yesterday there comes a day of reckoning. Bear Stearns, Fannie, Freddie, Lehman and AIG are dominos in the forced-sells of margin accounts where tomorrow catches up with today.

Reflect and Act
We don't have the answer to this crisis. But we should learn to recognize the Lethal Jackpot pattern. We should notice its signs in matters of health, in our relationships, in our careers and in our finances, too. Reflect on your experience and observation of fatal patterns. Recognize for yourself that there was a series of junctures where the vicious pattern could have been aborted. You can choose to stop, to step back and to interrupt the deadly spiral before the crash.

Now it's your turn. Turn the Key. Recognizing a series of miscalculations and averting a vicious spiral decent is your most critical survival capacity. Engaging in a virtuous rising spiral is how you thrive. Decide to take responsibility, to intercept the Lethal Jackpot. Choose awareness, knowledge and understanding. Make the higher choice. It's always the rewarding one in the final analysis.