Sunday, May 9, 2010

Advisors and Regulators

One has to assume that if economic/financial advisors and regulators really understood what was going on, they wouldn't be advisors or regulators. It's not that they aren't smart enough. It's a lack of confidence in humanity. It's about making money or doing the right thing. If these two always occured in conjunction with each other then our advisors and regulators would be rich and our bank executives poor. Pick your battles but don't tell me somebody getting paid any less than $100k a year actually knows what's going on.

1 comment:

  1. Reminds me of a somewhat parallel bit from Albert Camus: "Politics and the fate of mankind are formed by men without ideals and without greatness. Those who have greatness within them do not go in for politics."

    Although, of course, some people simply prefer the quiet unassertive path, and don't necessarily work at an appropriate pay grade. And sometimes there are posts (like Chairman of the Federal Reserve) which pay out compensations in prestige.

    But I think even when you can attract genius in the right places, it is insufficient. No human brain is equal to the task of optimally orchestrating the global economy. The best case scenario is promoting a system which is generally capable of self-optimization, and trying not to muck it up too much. Sometimes the most capable individuals are even a bad fit, because they are more likely to have delusions of their own abilities.