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True, but the fact of complexity can make "risk management" effectively impossible.

I suppose I'm groping towards the idea that it may not actually be the Rating Agencies fault. We may have reached a point where it's not possible to calculate the risk involved in some of these instruments.

Of course, part of the disease is the reliance on calculation, many of us looked at various instruments and could see trouble ahead, but the "calculation models" did not...

by Metatone (metatone [a|t] gmail (dot) com) on Sat Jan 26th, 2008 at 11:30:36 AM EST
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If you can't estimate the risk of something you don't stick a big fat zero in the calculations.

We have met the enemy, and he is us — Pogo
by Migeru (migeru at eurotrib dot com) on Sat Jan 26th, 2008 at 11:32:28 AM EST
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