Posted February 3rd, 2009
In his Sunday Washington Post op-ed, “Humbled Masters At Davos,” David Ignatius describes the “collective chagrin” that came over the annual World Economic Forum in Davos, Switzerland last week:
Davos doesn't do humility, normally. These are the masters of the universe, after all, whose gathering each winter has come to symbolize the process of economic globalization. But this year, with the global economy in the tank, there is a kind of corporate self-examination. Beyond the panel discussions, you could hear a collective sigh of "Oops!" and a plaintive "Now what?"
Attendees celebrated two outliers of thought who predicted the financial mess we now find ourselves in, one of which was Polytechnic Institute of NYU’s very own Nassim Nicholas Taleb. According to Mr. Ignatius, Professor Taleb, distinguished professor of risk engineering, author, and economic analyst, was one of two “rock stars here this year, surrounded by adoring fans.” He writes:
Taleb, a former trader who wrote the book "The Black Swan," argued that Wall Street's models — supposed to prevent bankers from taking excessive risks — were actually a big part of the problem, since they created a false sense of confidence about the future. Rather than seeking reassurance in models, he advised anxious traders to go have a drink or take up religion.
"It's easier to say 'God knows' than 'I don't know,' " said Taleb, in what might be a motto for this year's Davos meeting.
Humbled Masters At Davos