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To: Cogito Ergo Sum who wrote (112126)	10/18/2008 3:21:22 AM
From: Elroy Jetson	2 Recommendations Read Replies (1) of 206184

Nassim Nicholas Taleb was on Newsnight this evening on BBC America. Quite an interesting program exploring the unfolding problems. Taleb emphasized that we are just at the very beginning of this deleveraging. In no way close to a resolution. Really pointed criticisms of the Chicago School and their non-reality based ideas, particularly for Harry Markowitz and his "modern portfolio theory" which has resulted in waves of flocks of "Black Swans". Taleb demanded the immediate cessation of the use of the non-predictive "Quantitative Value at Risk" and the related mean-variance calculation in banking, and the analogous quantitative portfolio risk which essentially caused the collapse of collateralized debt. The entire carnival of clowns from the University of Chicago including Friedman and Markowitz with be completely discredited for painfully obvious reasons when this is all over. .

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