Those cows trusted us!
Sir Peter Schwartz in “Right question that has several possible answers” December 2, rephrases the Queen’s question of “Why did nobody see this coming?” into a “What would it take to make decision-makers both believe and act?”
Absolutely the most valuable lesson we could take out of the current mess is to get a better understanding of why people can turn blind and deaf when they are warned on impending disasters.
In this particular case I would like to go back even a decade or so to ask the regulators of how come they in Basel could come up with such a crazy idea of sending out in the financial markets their City Slickers (1991), the credit rating agencies, knowing well these would, sooner or later, cause a stampede; and how come they still believe they could keep on using them without an even worse stampede ensuing in the future?
I can still hear one of the slickers saying “Those cows trusted us!
Absolutely the most valuable lesson we could take out of the current mess is to get a better understanding of why people can turn blind and deaf when they are warned on impending disasters.
In this particular case I would like to go back even a decade or so to ask the regulators of how come they in Basel could come up with such a crazy idea of sending out in the financial markets their City Slickers (1991), the credit rating agencies, knowing well these would, sooner or later, cause a stampede; and how come they still believe they could keep on using them without an even worse stampede ensuing in the future?
I can still hear one of the slickers saying “Those cows trusted us!
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