Tip'd

A community for financial news, ideas, and tips

Welcome to Tip’d, a social media site for finance, investing, and business topics. Want to participate? » Join Tip’d now! or read our FAQ.

The Real Cause of the Financial Crisis: An MIT Blackjack Team Perspective

Posted by Paisano1 1121 days ago (http://yourmortgageoryourlife.wordpress.com)
Category: Economy | Tags: bailout crisis economy hedge mbs
The solution that they usually flock to is to create such a complex Martingale system that they themselves cannot understand the longer term risk implications. As long as the mathematical analysis of the risk of ruin lies beyond the understanding of the CEOs, the money managing organizations can stay competitive by employing their latest version of a return-boosting Martingale, without admitting to themselves or to others that they have been peer-pressured into the financial equivalent of selling their soul to the Devil.
addto Save & Share   Topple Spam? Topple this!

Comments Who Tip'd