Is there any way they care about us?

Yevhen Pentsak (50) 11 August'09

Tags: Yevhen Pentsak, investor, crysis, risk

Any society rests on the fundamental ability of financial institutions, businesses and investors to predict possible future scenarios and select the best one in the row.

To take the above decision seems way too risky for no one can be 100% sure that some unfavorable version for the selected option will be avoided. Studying of risk factors implies clear understanding of the fundamentals of mathematics, psychology, statistical analysis and historical retrospections. The most justified decisions of nowadays are being taken with inevitable use of computer capacity. That is to say, comps are constantly “devouring digits” (as Peter Bernstein, the author of the amazing book “Against the Gods” aptly remarked) looking for more and more binary codes’ dish outs to munch, digest and spit out into the outside world.

Games, a universal part of human experience and part and parcel of any society, have always been present in all cultures. Egyptian tomb inscriptions also show scenes of gambling, and they are dated as early as 3500 A.D. In their attempts to describe universe ancient Greeks made use (metaphorically) of a huge chuck a luck gambling game with three brothers as players. At the end of that game Zeus won heaven, Poseidon – the sea, and Acheron – the underworld to become a governor of Hades. Greeks believed that order can exist only in heaven where stars and heavenly bodies turned up in certain periods due to the blessed laws of celestial mechanics. Probably, that’s why they didn’t attempt to seek for perfect order to be found on Earth, nor did they try to foresee things. Who knows, maybe they were right?

I’ve got a feeling that Yushchenko, Yanukovich and Timoshenko just did the same, they rolled the dice to determine Ukraine's destiny. “When are they supposed to care about people?” “They’re just doing that, they are casting lots!” With his keen sense of the nature of human conduct, Adam Smith defined the national leaders’ motivational patterns as immanent self over-estimation to be attributive to all big gamblers and coupled with a silly belief into their personal lucky star. He underlined though, that stomach for adventure inhering in the masses of people does play in favor of economic advance, whereas overconfidence and greed – quite the contrary – may well lead to crisis. Capitalism encourages people to calculate moves way in advance. Oscar Morgenstern did not trust in ability of economic science to foretell business activity, for customers, business community, and politicians factor the forecasts into their own decisions and deeds. The fact that such forecasts affect decisions encourages economists to make alterations into their prognostications, thus provoking investors into new reactions. The latter technique was constantly likened by Morgenstern to the deadly play between Sherlock Holmes and Prof. Moriarty who tried to cheat and destroy one another… It makes me wonder how precisely economists of the past managed to foresee the pattern of “military posture” being observed at the moment as used in the game between Presidential Secretariat and current government in Ukraine’s politicum!

From a purely statistical point of view it doesn’t matter much if one individual has made another 100.000 more or 100 individuals 1000 more. That’s why I am pretty sure that the growth we anticipate is going to be on purely statistical basis and the only physical thing to be experienced all the way through is going to be just further impoverishment of the majority!

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Мысли среди недели:путь к спасению мировой экономики

Последние события на мировых фондовых рынках заставили задуматься, как близко мы стоим к краю мировой экономической пропасти. События 11 марта 2011 года, 4 августа 2011 уверенно указывают на то, что депрессивное десятилетия начала третьего тысячелетия будет иметь еще более депрессивное продолжение. Движется ли мир в хорошем направлении во всех смыслах слова «добрый»? Может долго держаться макияж, если наносить один слой пудры за другим?

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