Masters of Nothing
How the crash will happen again unless we understand human nature
Biteback Publishing
Published on 3. September 2013
Book
Paperback/Softback
256 pages
978-1-84954-494-8 (ISBN)
Description
If we are to avoid a second crash, then we must achieve a better comprehension of human behaviour and apply this understanding to how we organise the financial system. Behaviour is important. Whether this be the behaviour of those who saw it coming, or of those who constantly berated them. The behaviour of those who rode the boom and switched at the tipping point to ride the bust, or the behaviour of those who held on to their principled as the system collapsed around them. It was human behaviour after all, that led us to construct a bubble nobody suspected was dangerous, yet nonetheless would burst with disastrous consequences. Contrary to the views of many before the crash the cycle is inevitable - you cannot eliminate boom and bust. In a boom the bullish are promoted whilst the cautious are overlooked, reinforcing the cycle. This factor is generally ignored by the beautiful but flawed models of economic analysts. Since we cannot abolish the cycle, we must ensure that busts are not so dangerous in the future.
The policy solutions are there if we're brave enough, from changing incentives, and creating fiscal and financial regulators with clout and discretion, through to changing corporate governance and shifting the power of executives.
The policy solutions are there if we're brave enough, from changing incentives, and creating fiscal and financial regulators with clout and discretion, through to changing corporate governance and shifting the power of executives.
More details
Language
English
Place of publication
London
United Kingdom
Dimensions
Height: 198 mm
Width: 128 mm
ISBN-13
978-1-84954-494-8 (9781849544948)
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Schweitzer Classification
Persons
MATTHEW HANCOCK is the MP for West Suffolk. He was formerly George Osborne's Chief of Staff and an economist at the Bank of England. NADHIM ZAHAWI is the MP for Stratford-on-Avon. He is co-founder and former CEO of YouGov plc.