Well, the Fed has done it again, with an unusual twist. 'Emergency' save of the morally hazardous? Gosh, the Greenspan put lives.
Well, the Fed deals with a system that can only be described as 'dismal' to now (the system can change for the better). So, they have to experiment as they go along. We can allow a little leeway for error since the heart seems to be in the right place.
One might argue that this 'moral lack' is not unlike an OEM who might try to 'change' along almost all decision axises simultaneously with consequences that become more apparent through time though one could also argue that any new apparency might be forced rather than insightful in terms of real 'earned value' analysis.
An OEM can plan to have a test period that is sufficient to prove both product and process, and our learning how really is of the essence. With the economy, where is the test bed? In a sense, what we see is the old problem of knowing what is real versus expected.
The economy could have a test bed, or sand box might be a better concept. Why is this needed and how to do we do it?
Well, with the growing opaqueness of the financial instruments, all are exposed to the playings of the financial gamesters. The computer and applied mathematics enabled all sorts of variations on creativity.
But, 'hey you guys, get your hands off our money' is something that they need to hear more.
Mind you, the opaqueness does not imply malfeasance necessarily (rather, it's an issue related to the quasi-empirical). What has happened, folks, is that what we learned from studying nature has migrated over to the money area. Finance has given big bucks for physicists and mathematicians to come play games.
Well, in science, nature knocks people down when they are wrong. In the economy what happens? Well, the fat cats land on their blubber; those who suffer are the poor unfortunates who have been leaned to the bone.
Just as an OEM cannot control through a wide-expanse of time toward 'real' earned-value, and we see many instances of this, we cannot expect anyone to control that which is studied via the 'dismal' sciences.
But, we can be thoughtful and control risk. In the OEM arena, that implies heavy focus on testing and process proving through 'real' experience rather than too much reliance on analysis and parametrics (or, we might add, letting the other guy handle the difficulties while basking in anticipated glory).
In finance, we need to think of how to put out the sand box. Then, the gamesters can play to their hearts content. We might even throw in more money as needed. Or, extract, to boot.
Stay tuned, as truth engineering involves many things, but one of the consequences will be knowing how such a 'sand box' might look and work.
One new factor?
Well, the baby boomers are going to get to where they don't want games played with their hard-won assets. That might be enough motivation for a slight start toward the right direction. After all, we are not all gaming teens forever, though some might like to think thusly.
The Fed needs to show more maturity. Of course, that whole position covers only one (monetary) of many aspects of a difficult issue.
08/01/2013 -- Ben cannot unwind or taper down; he has too many Doves. We'll have to get back to the king thing (yes, the divine rights of the CEO, new royalty, in other words) and dampening of these types by a new outlook (Magna-Carta'ísh).
09/09/2009 -- Alan's reign will be looked at, in time.
09/02/2009 -- Lean assumes a current framework which can be improved. That the process is still effective during the change can be checked easily. However, if it is not still effective or we do not have a stable framework, then we were, by necessity, in the undecidable state.
08/24/2009 -- Last year, Ben blinked and panicked. He frantically pulled out all stops as if with no thought for tomorrow. Now, he has no use for 'mea culpa' big daddy that he is. Ben, start to unwind now. The Vienna School's view that these things are undecidable (which is a computational issue) is right on.
2 hours ago