“A man who has committed a mistake and doesn’t correct it,
is committing another mistake.” ~ Confucius
Another quarterly earnings release has come and gone, and once again Canada’s former mobile tech heavyweight has stunned even those who have grown used to disappointment. It might seem unfair to criticize a company that services roughly 75 million BlackBerry subscribers worldwide – that is, when its service hasn’t failed – and sold over 14 million new phones and 150,000 tablets in the last three months alone.

A timely and frightening exploration of the causes and consequences of the emerging foreclosure mess. This close cousin of the earlier sub-prime mortgage debacle provides even more evidence of the financial industry’s hubris and inescapable self-interest.
As the saying goes: garbage in, garbage out…

Students of behavioral finance must have had a field day this past week. In the wake of a month of dismal economic reports, Wall Street got its risk on with a few better than expected reports on manufacturing sentiment, home sales, and employment. Hopium, it appears, is a powerful drug.

As evidence continues to mount that established models of rational decision-making are dangerously out of date, behavioral science has embraced human irrationality in all of its deceptively predictable forms. At the forefront of the field is Duke University professor Dan Ariely, whose simple experiments into human bias have shed light on everything from the fallacy of supply and demand to the problem of procrastination.

Stopping the spread of financial contagion is deceptively similar to plugging a ruptured deep-sea oil well: the cost is epic, the risk of failure is catastrophic, and expectations of success may be more hopeful than realistic. Recent efforts to address both crises share so many elements that a few tweaks to the following report on the Gulf catastrophe also freakishly describes efforts by the Eurozone to head off the risk of cascading sovereign defaults…

Churchill argued that democracy is the worst form of government, except for all the others. With capitalism now falling under similar fire, modern politicians, businesspeople and academics are once again questioning both the failures of free markets and the failures of government. As pundits gather on either side of the debate — casting blame and contempt across the regulatory divide — one often overlooked explanation for all the recent chaos is the time-honored tendency for human society to self-destruct. Behavioral economists and psychologists are having a field day watching our worst decision-making biases play themselves out in political and capital markets.

Mr. Dollar testified before the Financial Crisis Inquiry Commission today about the challenges of a self-regulating market and the dangers that lie ahead. While his belief in free market capitalism remains unshaken, Greenspan’s warnings about the key attributes that should underpin a stable banking system — adequate capitalization, liquidity, and regulatory oversight — cast a surprising shot across the bow of modern banking giants who have grown a little too comfortable with their bailout blanket and artificially low interest rates.