April 07, 2015

When the products of groupthink do not stay in Vegas, and are applied elsewhere, that can be truly sinister.

Sir, Janan Ganesh writes: People that work in the same field develop their own codes and slang. They sleep and socialize with each other. Without intending it, they seal off the world from uncomprehending outsiders. It is a byproduct of specialization and there is nothing sinister about it”. “The average voter is immune to romance and fevered rhetoric” April 7.

Hold it! That depends on whether what the specialists do in their intimacy stays in Vegas or not. For instance, when bank regulators got cozy in their little Basel Committee mutual admiration club, and through an incestuous groupthink came up with their portfolio invariant credit-risk equity requirements for banks, well that turned into something extremely sinister that completely distorts the allocation of bank credit worldwide.