Nobel, Or Un-Noble ?
From Nassim Taleb’s “The Black Swan“:
And now a brief history of the “Nobel” Prize in economics, which was established by the Bank of Sweden in honor of Alfred Nobel, who may be, according to his family who wants the prize abolished, now rolling in his grave with disgust. An activist family member calls the prize a public relations coup by economists aiming to put their field on a higher footing than it deserves. True, the prize has gone to some valuable thinkers, such as the empirical psychologist Daniel Kahneman and the thinking economist Friedrich Hayek. But the committee has gotten into the habit of handing out Nobel Prizes to those who “bring rigor” to the process with pseudoscience and phony mathematics. – Taleb, Nassim Nicholas. The Black Swan: Second Edition.
One example (out of several) that Mr. Taleb uses to back his disrespectful opinion of the vaunted Nobel prize in economics is the tale of prize winners Robert Merton, Jr., and Myron Scholes. Robert and Myron worked for Long Term Capital Management LP in the late 90′s. Of course, since they had a rigorously tight and academically peer reviewed modeling strategy, they were touted as geniuses and lots of people threw money at them in the hopes of making a killing in the financial markets. However, a combination of events lying outside of their impeccably rigorous, Gaussian-based, award-winning, often-copied, financial models caused the company to go ka-boom! Because of the massive 4.6 billion dollar loss (suffered in only 4 months) authored by these perceived Gods, the failure almost toppled the entire financial system.
The attempt by the guild of economics to elevate themselves to a level of respect higher than they deserve reminds me of this quote by Sam Culbert about the Gestapo, uh, I mean (in)Human(e) Resource departments in “Get Rid Of The Performance Appraisal” :
So in return for being the cheerleaders for management, the (HR) department that permits management abuse and cleans up after its mistakes, it gets a seat at the big boys’ table.
But so…. freakin’…. what! Every individual, group, and institution has an innate need to survive and thrive before the grim reaper comes a callin’ fer us down the road. It’s simply that the tactics and methods that we use to achieve our needs differ. Obviously, BD00 (and most likely you too) are “above” all the unfairness and inequity in the world. We’re fair and just and we deserve better. We’re not like the guild of economists or the Gestapo HR departments in corpocracies. Damn it, we’re better than “them“! The behaviors we exercise in order to survive and thrive are always noble; never un-noble (cough, cough).