As a financial historian, I was quite isolated in Oxford – British historians are supposed to write about kings – so the quality of intellectual life in my field is much higher at Harvard. The students work harder there.
Risk models are a substitute for historical knowledge, because they tend to work with just three years’ worth of data. But three years is not a long time in financial history.
One of the problems of writing and working and looking at the Internet is that it’s very hard to separate fashion from deep change.
We suffered a terrible blow on 11 September 2001. We responded with fear and anger. A fight-or-flight response is adaptive in any species. For us, given our power, fight was the only response we could imagine.
What’s so seductive about the efficient markets hypothesis is that it applies nine years out of ten. A lot of the time it works. But when it stops working, you blow up.
Like crime, terrorism is a fact of life. I grew up in Israel, where every unattended bag was a suspected bomb; when my family moved for a few years, it was to London in the early years of ‘the Troubles.’
Something that’s seldom appreciated about me is that I am in sympathy with a great deal of what Marx wrote, except that I’m on the side of the bourgeoisie.
As long as government is allowed to collect all Internet data, the perceived exigency will drive honest civil servants to reach more broadly and deeply into our networked lives.
Next time you open the paper, and you see an intellectual property decision, a telecoms decision, it’s not about something small and technical. It is about the future of the freedom to be as social beings with each other, and the way information, knowledge and culture will be produced.
Over time, the welfare state has become dysfunctional in a surprising way. But in a way it became a victim of its own success: It became so successful at prolonging life, that it becomes financially unsustainable, unless you make major changes to things like retirement ages.