This is clipped from a piece in today's L.A. Times. I reproduce it because I spent both Friday and Saturday nights at parties where people who are still plenty wealthy were poor-mouthing and talking about how evil the executives at Enron & etc. were. That their own greed played a significant role in creating these crooks is a concept that is utterly alien to them, it never even occurs to them. When confronted with that assertion, they scoff.
I don't think the denial aspects of what's going on right now could be stated any more succinctly than in the clip below.
It all goes to reinforce QwikSand's Basic Theory of Human Cognition: People don't believe what's true, because people don't know what's true. They believe some combination of what they must believe and what they want to believe. (And yes, there's a lot of overlap between the two.)
It also goes to reinforce McNealy's entirely justified reluctance to cooperate with the BS SEC requirement, which is just playing to the grandstands and people's desire to find someone else to blame. No matter how many restatements we get, no matter how many suits go from Armani to black-and-white stripes, peoples' ignorance, greed, and, most of all, over-estimations of themselves are what's really at the bottom of everything.
--QS
latimes.com
(Free registration may be required).
In the search for someone to blame, the corporate scandals have suddenly provided investors a real, if convenient, villain. The average investor, no matter how much research he did, was never going to uncover the deceit and malfeasance occurring in some of the nation's largest businesses [And the average investor didn't do ANY research --QS].
"What investors are really saying is they're not to blame," said Nofsinger. "They're trying to absolve themselves of any guilt."
But most investors registered the bulk of their losses before the scandals at Enron, WorldCom and Adelphia broke, say financial experts. Greed got the better of investors who forgot about their risk tolerance years ago and now have only themselves to blame.
"We were riding the dot-com bubble and many investors got speculative fever," said Patrick Gregory, an assistant professor of finance at Bentley College near Boston. "They didn't do the hard-core analysis you need to do ... as a result, they got burned." |
