Wiley InterScience :: JOURNALS :: Significance
Significance, the Journal of the Royal Statistical Society, has some very clearly written articles on topical subjects. A sort of bare bones journalism, with less of the selectiveness of data
'Six impossible things before breakfast: lessons from the crisis' by Bill Janeway is a very good recap on the theories underpinning modern finance, and their shaky foundations. There's nothing particular new about the drawbacks with Efficient Market Theory, but it's always very impactful to see the story presented in this way over the last century.
The article rightly ends with the psychology of humans - we're back to the greed and lemmings approach of people, wrought to maximum effect in a more connected and global society. The good news is that we can hopefully course correct without having to go to war about it.
Disturbing in this article is the interchange of Greenspan and Waxman
Mr Greenspan: “I found a flaw in the model that I perceived is the critical functioning structure that defines how the world works, so to speak”.
Chairman Waxman: “In other words, you found that your view of the world, your ideology, was not right, it was not working”.
Mr Greenspan: “Precisely. That’s precisely the reason I was shocked, because I have been going on for 40 years or more with very considerable evidence that it was working exceptionally well”.
Does he really think the whole theory base was not right, or just that it was abused so much on the last decade?
Significance, the Journal of the Royal Statistical Society, has some very clearly written articles on topical subjects. A sort of bare bones journalism, with less of the selectiveness of data
'Six impossible things before breakfast: lessons from the crisis' by Bill Janeway is a very good recap on the theories underpinning modern finance, and their shaky foundations. There's nothing particular new about the drawbacks with Efficient Market Theory, but it's always very impactful to see the story presented in this way over the last century.
The article rightly ends with the psychology of humans - we're back to the greed and lemmings approach of people, wrought to maximum effect in a more connected and global society. The good news is that we can hopefully course correct without having to go to war about it.
Disturbing in this article is the interchange of Greenspan and Waxman
Mr Greenspan: “I found a flaw in the model that I perceived is the critical functioning structure that defines how the world works, so to speak”.
Chairman Waxman: “In other words, you found that your view of the world, your ideology, was not right, it was not working”.
Mr Greenspan: “Precisely. That’s precisely the reason I was shocked, because I have been going on for 40 years or more with very considerable evidence that it was working exceptionally well”.
Does he really think the whole theory base was not right, or just that it was abused so much on the last decade?
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