The actual quote is " I can calculate the motion of heavenly bodies but not the madness of people". The author of the quote is none other then Issac Newton...he of the fallen apple. He made it after he lost a load of money in the market back during the South Sea share bubble. This just goes to show...that the current market collapse is just one of many historically, even the smartest guy/gal in the room can get slaughtered in the market, & last but not least...we simply never learn. Our base instincts always seem to take over & screw things up. At best...at least we are consistent.
The quote, which is now one of my favorites I read in the book Traders, Guns, & Money by Satyajit Das. I highly recommend it. It was written a few years ago but really explains why what is happening in the market & why even when we get out of this mess we'll just end up in another.
In a nutshell trading & accounting practices have gotten totally out of hand & are relying to much on "financial models" which simply don't really work. They just create loads of fees & lead to "unforeseen & statistically " impossible disasters within the "lab" but somehow seem to happen when exposed to the real world. I'm sure you can all think of real life examples of what happens when academics with no real world experience try to apply their vast knowledge & understanding to a problem & totally get it all wrong...
No comments:
Post a Comment