|ALM or Jackson Pollock?|
The regulatory community has given little thought (some would say no thought at all) to the human "madness" for economic fads and fashionable thinking. A serious study of this human phenomenon might be an important exercise for some modern day Darwin with little else to do. A scholar studying our quantitative "herd hysteria" might possibly propound a new "Origin of the Specious" or formulate a new "Theory of the Survival of the Fetish".
What does make us so ready to regurgitate rubbish on which we lack a cogent grasp? Why, like moths before a flame, are we so fascinated with the facile seduction of cookbook, cookie-cutter, quantitative solutions with recipes which so consistently prove to be half-baked
|Half-baked, half "aid"!|
(You just don't know how hard it is to work a word like that into a narrative!)...
Low hanging fruits?
Much of the current thinking on ALM is obviously ornamental. The toys of ALM are bright, shiny and plentiful - what if's, gaps, durations, shock tests, sensitivities and betas. All fun to play with but often of highly doubtful significance and dubious merit. Unfortunately, many regulatory practitioners use ALM much as a drunken sailor uses a light post - more for "support" than illumination.
which way is up?
In business as in life, true understanding is the most marvelous of directional tools and experience is the heart and soul of understanding.
|Brexit B.S., |
Contributing Cap/Mark Consultant
And as we see, yet once again, you can bet your "Brexit" that quants don't know bull !
[... at least not when it counts!]