Henry Baker <hbaker1@pipeline.com>:

I'm as upset as anyone by the financial crisis(es?) of the last several years, but I'm even more upset by the lack of mathematical sophistication of those in charge.

Although economics, feedback and chaos are related to mathematics, I think mathematical sophistication is less important than understanding the basics of the underlying situations. Most of these things have been pretty well understood for centuries under different names. In fact, out-of-context math, or any out-of-context specialized knowledge, becomes a smokescreen in many cases. I also doubt worldwide computerized trading networks involve any principles or issues much different than trading by camel caravan involved. Relativity just means finite communication speed in this case, an old familiar problem. If people are setting up fragile systems, there's something more than mere speed going on. Ways of buffering shocks are also an old problem. One thing to look at if people aren't cautious enough is whether caution is being punished by regulation, or carelessness rewarded. There is a bit of math sophistication that asks, are the spikes and dips we see more than what statistics and theory say we should expect? Is there even any news here? --Steve