Scoble’s interesting post on the ‘expertise’ of everyman.

Economic Idiocy‘ is an interestingly downbeat post by a generally upbeat personality. It is interesting not just from the current context of the big failure being faced by the US economy. More interesting, in my opinion, was his questioning the intellect of the collective – of the masses. He has managed to pinpoint the exact issue with a decentralised system, it just takes a small critical mass to cause a wave and not all waves are necessarily well thought out or even healthy in the long run. At the same time the other end of the spectrum is to live in a gilded cage of a centralised system. I have often thought about these things. However the way Scoble put it out there and the fact that ‘he’ did (I did not expect such a cynical view from blogosphere’s and disrptive media’s biggest fanboy) – made me link him here for the 2-3 people who visit me.

P.S: Normally you would find my favourite Scoble’s posts in my shared links. You can also find the latest posts there in my sidebar.

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One thought on “Scoble’s interesting post on the ‘expertise’ of everyman.

  1. Hey Brij, nice to finally find you on http://www…how r u doing?

    True, the article is interesting and ironically, scores of such kind have sprung up after the problem, none before it. Below is my attempt to explain the crisis in layman’s term…

    The current financial crisis at the Wall St. underscores all the other problems of the world. Why? Simply, because it may be the harbinger of a global economic recession. It is still the financial world where other countries catch cold when the US sneezes. US economy is already reeling, marred by the spending in the war in Iraq and an external debt of 13.8 trillion dollars. The US Congress recently approved a bailout plan. Will it help?

    What led to the current scenario? Is this the end of Capitalism? Will it ever be the same again? How does it affect us? Numerous questions come to our mind.

    Let’s start with the basics. The current financial problems rose from heavy subprime lending between 2003-2006, bad sales decisions, declining lending practices, and increasing housing prices. Subprime can be defined as the category of people who have high perceived risk of default, people with not-so-good credit history. Soon the banks started feeling the heat as the interest rates began to rise. The prices of the houses went down, foreclosures increased and the banks started to go bankrupt. New Century Financial was the first major institution to go down in April 2007. This started the “domino effect” and led to the current scenario.

    Now the banks don’t trust themselves. It has become difficult to secure a loan. The rates have gone up. If the bailout plan doesn’t work, it could lead to recession and unprecedented job losses. How? Soon, the problem would progress beyond the realm of financial institutions and start affecting other businesses. As that happens, a lot of companies could shut down all over the world.

    Is this the end of Capitalism? In my opinion, no. The current problem is not due to a fundamental lacuna in Capitalism, it’s due to bad corporate practices/decisions. I am sure people concerned would have learned with this experience and it would serve as a lesson for future decision makers in the financial industry.

    Speculating the future, I feel that the situation will only get better in case the bailout plan is effective. If not, it may get worse before it gets better. There is always a silver lining in dark cloud. I may come across as an optimist to some and why not? As Sir Winston Churchill said, “For myself I am an optimist-it does not seem to be much use being anything else.”

    Keep in touch, Brij.

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