In his latest editor?s memo, Stephen J. Adler writes:
Davos can deliver insights it doesn’t necessarily intend. The key messages that seemed to flow from four days of speeches, panels, “bilaterals” (i.e., chatting with someone), cocktail parties, and press briefings were these:
1. Everyone stupidly failed to see the financial calamity coming except roughly four economists who now must be heeded in everything they say and all they predict.
2. The private sector has ruined the global economy and can no longer be trusted.
3. Government is ascendant, with regulation closest to godliness.
4. These conclusions are correct and will stand the test of time.
What I took away instead was this: Beware conventional wisdom and groupthink. Be skeptical of tidy explanations for complex past events. Be even more skeptical of confident predictions of future human behavior. Don’t fight the last war.
Adler appears to have avoided the most harmful symptoms of bailout mania.
