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Greenspan Tells Congress Bad Data Hurt Wall Street
CWmike writes "Former Reserve Bank chairman Alan Greenspan has long praised technology as a tool to limit risks in financial markets. In 2005, he said better risk scoring by high-performance computing made it possible for lenders to extend credit to subprime borrowers. But today Greenspan told Congress that the data fed into financial systems was often a case of garbage in, garbage out. Christopher Cox, chairman of the Securities and Exchange Commission, told the committee that bad code led the credit rating agencies to give AAA ratings to mortgage-backed securities that didn't deserve them. Explaining in his testimony what failed, Cox noted a 2004 decision to rely on the computer models for assessing risks — a decision that essentially outsourced regulatory duties to Wall Street firms themselves."
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Yes, if only we'd had a computer to tell us that creating money out of thin air has negative economic consequences.
...Bad Data Hurt Wall Street...
So Lore is to blame?
We all have problems.
The invisible hand of the market would not let us down like that. Its mighty transparent fingers must have been deflected from its course by some foul socialist sabotage.
I blame whomever is the current political threat to continued deregulation and corporate empowerment.
The problem with most people is that they don't realize how much they don't know.
Hmmm... I don't know about that.
The problem is all you youngsters who don't realize how much we know that you don't.
Are you sure you didn't mean '... who don't realise how much we know we that you don't know that we know that we don't know'
like phosphorescent desert buttons singing one familiar song
Blame Noonien Soong.
Slashdot "libertarians": Small government for me, big government for those I disagree with. -1, I disagree with you
Are you talking about the known unknowns? Or the unknown knowns? As long as it is not those dastardly unknown unknowns!
Ho! Haha! Guard! Turn! Parry! Dodge! Spin! Ha! Thrust!
There are things we know we know.
We also know
There are known unknowns.
That is to say
We know there are some things
We do not know.
But there are also unknown unknowns,
The ones we don't know
We don't know.
©Dr Strangelove 2002
One swallow does not a fellatrix make