Hindsight: Difference between revisions

Hindsight (view source)

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 It is a persistent frame: by the time we get around to analysing any catastrophe and how it played out, all circumstances are known, all options have crystallised and all discretions have hardened. The employee who, with imperfect information and in the fog of war, tacked to ''starboard'' when hindsight revealed a safe harbour to ''port'' finds {{sex|himself}} short an very ugly option which those with executive responsibility for his performance will be mightily tempted to exercise. This is the lesson of {{fieldguide}}: the executive blames the [[meatware]], because by doing so, it exonerates the executive.
+===[[Madoff]] and catastrophe===
+What caused the catastrophe — an inquiry one can only launch upstream — forms, informs, and reforms the ''down''stream [[narrative]]. Take [[Madoff]]: now we have [[No One Would Listen: A True Financial Thriller|the book]], the film, the exposés, the [https://www.youtube.com/watch?v=8PlLCKW4zuY fabulously gruesome congressional committee hearings] — now we know all that, ''everything'' about Madoff’s investment strategy is ''obviously'' bogus. How could this possibly have been allowed to happen? There can be only one explanation: ''someone further down the chain was asleep at the switch''.
-What caused the catastrophe — an inquiry one can only launch upstream — forms, informs, and reforms the ''down''stream [[narrative]]. Take [[Madoff]]: now we have [[No One Would Listen: A True Financial Thriller|the book]], the film, the exposés, the fabulously gruesome congressional committee hearings, ''everything'' about his investment strategy is ''obviously'' bogus. How could this possibly be allowed to happen? There can be only one explanation: someone further down the chain was asleep at the switch. This is where the historian’s perspective is more useful than the [[thought leader]]’s.<ref>Sidebar: {{author|Thomas Kuhn}}, the greatest of all philosophers of science, was neither a scientist nor a professional philosopher but a ''historian''.</ref> We know Madoff’s regulators were ''not'' asleep at the switch because we have {{authorHarry Markopolos}}’s testimony that they ''can’t have been'': he kept prodding them in the ribs and pointing out exactly the anomalies they should have, the now agree in hindsight, been alarmed by.<ref>His paper to the SEC, in November 2005 —more than ''three years'' before Madoff eventually shopped himself (even then the SEC didn’t see it!), was entitled “The World’s Largest Hedge Fund is a Fraud.”</ref>
+But ''were'' they? This is where the historian’s perspective is more useful than the [[thought leader]]’s.<ref>Sidebar: {{author|Thomas Kuhn}}, the greatest of all philosophers of science, was neither a scientist nor a professional philosopher but a ''historian''.</ref> We know [[Madoff]]’s regulators were ''not'' asleep at the switch because we have {{author|Harry Markopolos}}’s testimony that they ''can’t have been'': he kept prodding them in the ribs with a stick and pointing out exactly the anomalies they should have been alarmed by.<ref>His paper to the SEC, in November 2005 —more than ''three years'' before Madoff eventually shopped himself (even then the SEC didn’t see it!), was entitled “The World’s Largest Hedge Fund is a Fraud.” If that won’t wake you up, nothing will.</ref>
-it wasn't that the operators were asleep, that is to say, but that ''their switch didn’t work''. But a maladroit switch is the responsibility of the executive, not the worker.
+it wasn't that the operators were asleep, that is to say, but that ''their switch didn’t work''. something about the narrative frame was amiss. But a maladroit switch is the responsibility of the executive, not the [[meatware]].
+===[[GameStop]] and catastrophe===
-As of January 2021, we have an opportunity to see this [[dissonance]] live, in the wild, before it to ossifies into wise hindsight, with the [[GameStop]] phenomenon. Here, “lack of attention to data” is less plausible even than usual because the putative “victims” — [[hedge fund]] industry titans: tiny violins, right? — had arguably more [[data]], and more ''data-processing capability'' at their disposal than ''anyone in history''. Their opponents, a rag-tag aggregation of retail deplorables coalescing around a Reddit channel, had the [[network effect]] and the wisdom of crowds in their corner, but nothing like the computer horsepower nor institutional support of the funds they took down.
+As of January 2021, we have an opportunity to see this [[dissonance]] live, in the wild, before it to ossifies into wise hindsight, with the [[GameStop]] phenomenon. Here, “lack of attention to [[data]]” is less plausible even than usual because the putative “victims” — [[hedge fund]] industry titans: tiny violins, right? — had more [[data]], and more ''data-processing capability'' at their disposal than ''anyone in history''. Their opponents, a rag-tag aggregation of retail deplorables coalescing around a Reddit channel, had the [[network effect]] and the wisdom of crowds in their corner, but nothing like the computer horsepower nor institutional support of the funds they took down. As I write the situation is ongoing: GME is fighting like a hooked Marlin, but you sense the end is near. But Melvin is down 53% already. Damage done.
 ''A “failure to crunch data” was not the problem here''. The problem was ''a failure of narrative''. Part of that failed narrative was ''the primacy of [[data]]''. [[In God we trust, all others must bring data]]. But will ''that'' be the lesson we all learn from this debacle? Like the certain death of a bricks-and-mortar company with an irretrievably broken business model, don’t bet on it.
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 *[[Proactive]]
 *[[GameStop]]
-*[https://www.youtube.com/watch?v=8PlLCKW4zuY The SEC [[general counsel]] trying to plead executive immunity from testifying before Congress]
+*[https://www.youtube.com/watch?v=8PlLCKW4zuY The SEC [[general counsel]] trying to plead executive immunity from testifying before Congress]Representative Gary Ackerman (now retired) will forever be a ''Hero of the JC, First Class'', for this excoriation.
 {{ref}}