Should we not also be concerned with the behaviourism of the Financial Times? I mean FT having such a delicate ego?

Before we need to concern ourselves with the behaviourism and the market, which is quite some nonsense, unless we want to ordain the markets to behave in some special way, we should concerns ourselves with those whose behaviourism could most distort the markets… like the bank regulators.

So, what behaviourism could cause them to regulate banks without defining the purpose of the banks, more than that of being safe mattresses to stash away the cash?

So, what behaviorism could cause them to believe that what bankers perceived as risky was more dangerous than what bankers perceived as safe?

So, what behaviourism could cause them to believe they needed to tilt so much in favor of the public sector so as to assign the sovereign a risk weight of zero percent and to us, We the People, one of 100%?

So, what behaviourism could cause them to believe the world becoming a better place with the banks avoiding taking the risks of lending, like for instance to SMEs and entrepreneurs?

Etc., etc. 

Why do I ask? Because I have sent FT thousands of letters on this issue, and which they have 99.9% ignored, because, though they might say otherwise, they are not without fear nor without favour.

What behavioral theory explains how hard it can be for even those who know it to understand?

Sir, Tim Harford discusses “base rate” and admonishes us:“It is easy to leap to conclusions about probability, but we should all form the habit of taking a step back instead. We should try to find out the base rate, or at least to guess what it might be. Without it, we’re building our analysis on empty foundations” “How to make good guesses” February 26.

So Mr. Harford: Clearly an asset that is evaluated as risky is normally expected to cause larger losses to a bank than an asset that is perceived as safe. But, what is the base rate for that a bank would create excessive exposures to what is ex ante perceived as risky? Is really what’s risky more dangerous to the bank system than what is perceived or has been deemed as safe? 

What sort of behaviorial explanation would Daniel Kahneman, Amos Tversky, Maya Bar-Hillel, Richard Nisbett, Eugene Borgida, Philip Tetlock and other experts give to the fact that a person like the Undercover Economist, even when in possession of the required knowledge, just cannot accept the fact that the pillar of our current bank regulations, the credit risk weighted capital requirements, is built upon a completely wrong foundation? 

@PerKurowski ©