Category: Quotes – Economics and Finance
Capitalism vs. Socialism
The inherent vice of capitalism is its unequal sharing of blessings. The inherent virtue of socialism is its equal sharing of miseries. — unknown — Continue reading Capitalism vs. Socialism
The Trillion Dollar coin solution (from the Economist)!
A very intriguing idea but yet a potentially creative solution the the US’ current dilemma… Read on (a quote from the Economist)! “Sovereign governments such as the United States can print new money. However, there’s a statutory limit to the amount of paper currency that can be in circulation at any one time. Ironically, there’s … Continue reading The Trillion Dollar coin solution (from the Economist)!
Goodhart’s Law
As soon as reliance is placed on a relationship, the significance of the relationship changes. d.c.k. Continue reading Goodhart’s Law
“Risk means more things can happen than will happen.” – Elroy Dimson
“Solidarity” – a readiness to bear the strains of interdependence in order to reap its rewards.
A quote from an FT article “Struggling to lead our hectic world” by Philip Stephens published on May 26, 2011. d.c.k. Continue reading “Solidarity” – a readiness to bear the strains of interdependence in order to reap its rewards.
How much is one trillion dollars?
In an attempt to explain how much $1 trillion is, a speaker started by describing as follows: “If you spend $1 every second, I know it sounds implausible, but I had a wife who could actually do that, how long would it take to spend $1 trillion? On that note, she lost her credit card … Continue reading How much is one trillion dollars?
On a long enough timeline, the survival rate for everyone drops to zero.
Alan Greenspan – FT 06-October-2010
“[…] It is going to take years to address the unprecedented complexity of final rulemaking required in the massive Dodd-Frank bill. The inevitable uncertainty engendered will inhibit financial innovation and intermediation, and render the rules that will govern a future financial marketplace disturbingly conjectural. This is bound to have a significant impact on economic growth. … Continue reading Alan Greenspan – FT 06-October-2010
Complexity and nature.
Given the complexity and fundamental unpredictability of nature, an approach that is coarse and less complex may be the best long-term risk management strategy. Continue reading Complexity and nature.
Complexity and the organization.
The root of the problem is not the complexity of the unseen risks – it is the complexity of the organization. Thus, the finely tuned approach to risk – the approach that would seem optimal in any one world – may in the long run be suboptimal. Continue reading Complexity and the organization.
In a strategic game, what you know can be truly inconsequential.
Financial Engineering and Nature
The engineer reacts to nature but nature does not generally react to the engineer. But: The laws of finance react to the financial engineers’ creations, rendering risk calculations invalid. This is closely related to what George Soros calls ‘the concept of reflexivity’. Loosely speaking, there appears to be a feedback loop (positive or negative) between … Continue reading Financial Engineering and Nature
Daniel Kölsch - Saxophones, Clarinet & Flute 