Viswanathan K's Thoughts

I remember this CSI - New York episode which started with a guy (adult) dressed as Superman running in from nowhere and preventing a robbery. Next scene, this Superman is found dead in an alley. That scene stuck with me: aren’t superheroes supposed to be invincible? A couple of weeks back, another guy (this time in real life) dressed as Superman came to the rescue of a bleeding, unconscious pedestrian who had been hit by a car in Melbourne. No, he didn’t turn back time and prevent the accident from happening. Rather, this Superman was a doctor in real life and he did the necessary medical steps! But the good doctor was almost prevented from doing his rescue act because bystanders felt that, well, anyone in a superhero costume must be a nutjob! So why was the doctor in a Superman costume in the first place? Because he was coming back from a costume party, where, get this, he even charmed Wonder Woman! Even the comic book version can’t beat that story, can it?

“Like all of life’s rich, emotional experiences, the full flavor of losing important money cannot be conveyed by literature.” - Fred Schwed Apparently, most academics in the field of economics have never heard the quote or known the feeling. How else can you explain why they come up with all kinds of theories, and yet we keep lurching from financial crisis to bubble to collapse? Take one of their favourite recommendations/theories: diversification and buying securities (bonds, stocks etc) that are not correlated. Like all theories, they don’t get into the details of how to identify whether the securities you buy are correlated or not. After all, if they had spelled out the details, we’d never have had the financial crisis of 2008 where investments banks (and even a few countries) all ended up owning highly correlated securities and had to be (and still are being) bailed out. To me, it just sounds like talk. It sounds good in theory, but nobody has a clue on how to apply it in real life...