These are the lessons that I’ve learned. Quite simply, this is my own odyssey, and I do not be expectant of everyone to have discovered these lessons, nor do I feel the urge to impose them on others. 2. The normal theme over the many lessons is that I am a lot more wary about using past or historical data, whether it is at the business level (success risk etc.) or at the macro-level (equity risk rates). Mean reversion, i.e., the assumption that figures revert to historical averages back again, has offered us well, at least in developed markets for a long period, but blind adherence to it can decimate companies and portfolios.
3. At a gut level, Personally I think that I have a better knowledge of risk and the need for risk-monthly premiums now than before the problems. Fundamentally, I think that this turmoil was precipitated by a belief that we can measure and control risk, when the nature of risk is that it cannot be ever fully measured or controlled. 4. I would not classify myself as a behavioral economist, but I am more willing to give behavioral finance a place at the desk when we think about solutions to corporate financing and investment problems, after the crisis, than before.
It often changes to the point that there surely is an expensive new learning cost associated. I recommend people spend the time and find out the command series and if they stick to Windows I would recommend …
