The Collapse of an Economic Model

231.01Comment: Until recently the Black-Scholes-Merton model was used to mitigate the risk in fluctuating markets. The economists who developed it (Scholes and Merton) were awarded a Nobel Prize for it. Today it has reached a dead end.

My Response: Just imagine, the world’s leading economists received a Nobel Prize, and ten years later a crisis broke out that overturned absolutely everything! To what extent humanity is like blind kittens!

The economy is the imprint of our inner egoistic state. If I am connected with you by some kind of ties, then all this can be calculated according to economic formulas: how much I owe you, how much you owe me, and the same between everyone. That is, the connection of people with each other is displayed in the clearest, rigidly formulated way in the economic ratio.

Therefore, we have reached a dead end: there they cheat, here they inflate some kind of bubbles, there the economy is more rigid, and here it is more social or naturally socialist, and so on. All this reflects the inner world of a man.

Today we are not only in an economic crisis, as it seems to us, but also in other crises. This shows us that we have reached the biggest general crisis that human society can experience.
From KabTV’s “Close-Up. The Future of Humanity” 7/17/11

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