And you are here why?

You've all heard of The London Whale , right?  The dude(s) at J.P. Morgan's Chief Investment Office in London who managed to lose $6 Billion on botched investments ? The gory details on what happened are out, and they are dry - seriously dry - reading.  But there is one part that stands out - the role of spreadsheets in all this. From FT Alphaville - [...] the model operated through a series of Excel spreadsheets, which had to be completed manually, by a process of copying and pasting data from one spreadsheet to another[...] Yeah, you got that right.  Our Financial Overlords use Excel and copy/paste in their overlord-ian activites.  (We are so doomed) You pretty much know where this is leading, right? an operational error in the calculation of the relative changes ... [s]pecifically, after subtracting the old rate from the new rate, the spreadsheet divided by their sum instead of their average, as the modeler had intended. Brilliant. Turns out that th...

“The greatest triumph of the banking industry wasn’t ATMs or even depositing a check via the camera of your mobile phone. It was convincing Treasury and Justice Department officials that prosecuting bankers for their crimes would destabilize the global economy.” -Barry Ritholtz Source The Daily Beast

From The Big Picture , more evidence that the financial crisis was entirely, and completely, foreseeable . We’ve known for   4,000 years   that debts need to be periodically written down, or the entire economy will collapse. And see   this . We’ve known for   2,500 years   that prolonged war bankrupts an economy. We’ve known for   1,900 years   that rampant inequality destroys societies. We’ve known for   thousands of years   that debasing currencies leads to economic collapse. We’ve known for   hundreds of years   that the failure to punish financial fraud destroys economies, as it destroys all trust in the financial system. We’ve known for   hundreds of years   that monopolies and the political influence which accompanies too much power in too few hands is dangerous for free markets. We’ve known for   centuries   that companies will try to pawn their debts off on governments, and that it is ...

The Economist (!!!!!!!!) is calling you a Bankster.

BigData and Rents Janko at GigaOm had an article about Ethics and BigData ( Drawing an ethical line in the bigdata sand ).  The basic point is well-framed - in a world of increasing complexity, it is getting easier to hide societally harmful behavior behind algorithmic complexity. All companies want to maximize internal efficiency to save on power bills and production processes. Even non-profit and government organizations  want to eliminate costly defrauding of their systems  and figure out the best ways to spend their limited resources. But is there a line we shouldn’t cross when it comes to using analytics to squeeze every last dollar out of an operation?  I think there is, and I think it’s at the point of transition between things we  want  and things we  need . Case in point: On Tuesday, the  New York Times  published an article  describing how specialized software is letting landlords maximize rents  by analyzing supp...