Emanuel Derman

The perils of pragmamorphism

September 23, 2011

Having been a scientist, one of my major pet peeves is the naïve use of science. Let me give you several examples.

Every street’s a boulevard in old New York

September 14, 2011

On my way to New York from South Africa in the Sixties, I stopped in Israel. It was midsummer, and in Ramat Gan where I stayed for a few weeks, people sat out at night on their breezeless balconies and played cards till late. Food vendors sold sunflower seeds on the street; people popped them into their mouths and then split them with their teeth, swallowed the core and spat out the shell through the bus window in one continuous mouth-teeth-tongue movement, no hands. Streets, apartment and balconies merged into a kind of shared outdoorsiness. I’d never seen it before and I liked it.

Dystopic finance

September 8, 2011

For a couple of years now I’ve had a bad feeling about the field of finance. Though I often inveighed against the mechanical use of models, I didn’t damn the entire endeavor. I still don’t, but the other day, talking to a colleague who was much younger than me, I discovered that we had somewhat similar sentiments. Mine are summarized as follows. I hope it’s just a mood.

God’s 11 principles

September 8, 2011

If God had only had a committee of business writers to help him, I think he could have done a better job:

Physicists & economists, influence & responsibility

September 2, 2011

I grew up in a post-WWII world where, temporarily, because of their capacity to create devices that wreak destruction, physicists had lots of influence in government. Think Einstein, Oppenheimer, Teller. By the time I went to graduate school at Columbia, the U.S. was involved in Vietnam, and a new bunch of much younger physicists were active in JASON, a Government advisory group. There were many protests against JASON at Columbia in the Sixties, as a result of mild-mannered physicists writing reports with titles (I recall)  like “Interdiction of Trucks By Night,” apparently to do with bombing the Ho Chi Minh Trail. Recently someone claimed that JASON stood for “Junior Achiever, Somewhat Older Now” which captured the hubris of scientists at the time. Influence and power is seductive.

A serious question

September 1, 2011

Capitalism depends on lending and borrowing, and hence on banks. In that sense banks are a utility, like Water Works or Electric Company.