His whole thing about risk fell flat. The Hedge Fund industry has its own crooks and theives who robbed people blind while feeding them misinformation. By making them the ‘preferred vehicle’ of people who know to take ‘risk’, you’re in effect painting a big “Start a Hedge Fund R Us” sign to all the unscrupulous people out there who want to find a way around any kind of oversight with false promises.

Holding people accountable for their words and promises takes a bit more then just saying “use hedge funds.” Those managers, too, need accountability, or the abuse will continue to fester in that segment of the industry.

Felix’s thesis is borne out by the truly third-rate interpretations of almost all medical causality (hence the 1000 contradictory scare stories each and every week) and the historically awful conclusions drawn by social scientists about almost everything.

The best finance minds and writers in my experience come from other fields – usually to do with human behaviour in general,or social anthropology in particular. Chart-guys will talk about gradual panics – and people like me say “There is no such thing”.

This doesn’t make us bigoted Luddites – it just means we didn’t get the commonsense bypass procedure yet.

An example: being a wonk, France’s Christine Lagarde thinks a colander-style eurobank stress test showing everything is AOK will end the EU crisis. This is because Madame Lagarde doesn’t understand the importance of trust and belief in that magic word ‘confidence’: she knows only the confidence trick.

The first thing you learn as a research interviewer is that your job is to spot when people are telling you defensive lies.

The second lesson you learn is ‘don’t listen to what they say, audit what they do’.

It works for me.

http://nbyslog.blogspot.com/2010/07/you- cant-play-secret-squirrel-with.html

Regressive taxes kill the poor, after all. Works for firms just like it does for individuals.