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FT.com / Comment / Opinion - Mother of all carry trades faces an inevitable bust
makes more sense than anything governments have done so far about the recession... "This unraveling may not occur for a while, as easy money and excessive global liquidity can push asset prices higher for a while. But the longer and bigger the carry trades and the larger the asset bubble, the bigger will be the ensuing asset bubble crash. The Fed and other policymakers seem unaware of the monster bubble they are creating. The longer they remain blind, the harder the markets will fall."
FT.com - Inflation is the greater threat to a sustained recovery
interesting article from Alan Greenspan. I do believe we are not over the worst yet, 'green shoots of recovery' nothwithstanding.
Why Economists Failed to Predict the Financial Crisis - Knowledge@Wharton
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By relying so heavily on the view of humans as rational, the paper's authors argue, economists ignore evidence of irrational behavior that is well documented in other disciplines like psychology and sociology. Even if an individual does act rationally, economists are wrong to assume that large groups of people will react to given conditions as an individual would, because they often do not. "Economic modeling has to be compatible with insights from other branches of science on human behavior," they write. "It is highly problematic to insist on a specific view of humans in economic settings that is irreconcilable with evidence."
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When certain price and risk models came into widespread use, they led many players to place the same kinds of bets, the authors continue. The market thus lost the benefit of having many participants, since there was no longer a variety of views offsetting one another. The same effect, the authors say, occurs if one player becomes dominant in one aspect of the market. The problem is exacerbated by the "control illusion," an unjustified confidence based on the model's apparent mathematical precision, the authors say. This problem is especially acute among people who use models they have not developed themselves, as they may be unaware of the models' flaws, like reliance on uncertain assumptions.
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Zero Hedge: The One Trillion Commercial Real Estate Time Bomb
analysis of Commercial Mortagage Backed Securities, detailed and sound
Creative destruction: Interview with Richard Foster - The McKinsey Quarterly - Creative destruction Interview Richard Foster - Strategy - Growth
at last someone who is not beating up capitalism.
A Question Revisited: Is Capitalism Working? - Knowledge@Wharton
a very misguided article for many reasons. the ultimate is holding up 'french capitalism' as an example. Shurely shome mishtake?!
Kevin Kelly -- The Technium
this is all very well but this wonderful screed about ownership vs renting forgets an important issue of the 'consumer' being a creator, producer and distributor. That brings in 'ownership' via back door or at least models based on recognition that demand
The Economics of Giving It Away - WSJ.com
perhaps time for 'because effect' models? making money 'because' of something rather than 'with' something.
How Government Prolonged the Depression - WSJ.com
government is not the solution to the problem, government is the problem
How to create a profitable Freemium startup (spreadsheet model included!) | Futuristic Play by @Andrew_Chen
interesting, if probably just commonsensical
Schneier on Security: Breach Notification Laws
our data is an externality in transaction. others can either build their business around it, such as CRM or advertising, or we can find a way to 'internalise' it i.e. adding cost or value to the transactions we have with vendors. this would help both priv
Long Tail theory contradicted as study reveals 10m digital music tracks unsold - Times Online
modelling data is a manipulable exercise, report not convincing, comments for the article point out a few issues with it.
BBC NEWS | Business | German ridicule for UK policies
quote: UK's switch from financial prudence to heavy borrowing was both "crass" and "breathtaking". Well, that would be dandy but what financial prudence, I ask!!!
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