2008/11/2 Ben Goertzel <[EMAIL PROTECTED]>: > Computers were used > quite narrowly to analyze the value of mortgage backed securities - and > everybody knew that is what they were doing. They had some bad HUMAN > assumptions.
Calculation errors can be corrected, but to really screw things up requires a human in the loop - along with all their biases, crazy emotions, short term linear thinking and capacity for self-delusion. I agree with most of these pundits that the financial troubles were not really the fault of trading programs, although the use of such programs allows trading decisions to be arrived at and executed more quickly, amplifying the positive feedback effects when things do go wrong. Another factor which helped to leverage the housing bubble was the systematic use of mass media. For the last few years popular TV shows depicted people of average incomes buying and/or developing properties (including second or third homes in foreign countries) which in previous decades would have been far beyond their means. I don't really watch the "old media" at all, but I'm told that all those TV shows have since been taken off air. People were actively being encouraged to take on more and more debt, whilst average earnings were not rising at anything like the same rate. Sooner or later something had to give. ------------------------------------------- agi Archives: https://www.listbox.com/member/archive/303/=now RSS Feed: https://www.listbox.com/member/archive/rss/303/ Modify Your Subscription: https://www.listbox.com/member/?member_id=8660244&id_secret=117534816-b15a34 Powered by Listbox: http://www.listbox.com
