Formative experiences.
Topic: Misc.
My recent posts about climate change have generated some input from people who seek to mock. A classic example is this:
"David has spoken. He's never wrong so just face facts. The vast majority of us, including the majority of scientists, people who have had a university education and people with plain common sense, are wrong! I know it is hard to believe that someone can look at the evidence, claim to know a bit of maths and says he makes a living from poker but sees the exact opposite of what we are seeing."
This, I hope, is why you read this site - because I'm someone who's prepared to stick his neck out and express a contrary view. But I don't think that I've ever expressed why before. It's time I should.
I left university in 1990 and joined Midland Bank (later HSBC). On the induction day for new graduate trainees, we were given a potted history of the bank. The bit that interested all of us most was the experience of the losses incurred in lending to third world countries. The people giving the training were honest enough to give a warts-and-all explanation. I don't recall the whole story now - the acquisition of an American bank called Crocker seemed fairly important in the story, but that's beside the point. What was interesting was talking to people who'd been in the bank for some time about how it was that so much had been lost through poor lending. A common theme was that 'everyone was doing it' - a sort of safety-in-numbers mentality that is nowadays called "groupthink". It imprinted on my mind the idea that there are times when it's vital to be able to hold a contrary view to the crowd.
The stock market had crashed in the first term of my time at university (Oct 1987) and after that I read a lot of books about markets and their speculative booms and busts. 'Markets Wizards', 'Reminiscences of a Stock Operator' and 'Crashes' were some of them. I was particularly struck by a passage in Market Wizards where one of the star traders talks about the need for a 'variant perception' - that unless you believe something that most others don't, you won't be a successful trader.
After graduating in the summer of 1990, I went to Australia to stay with my uncle and his family for a few weeks. While I was there a building society called Pyramid went bust. There were fears of runs on other banks. My uncle closed his account with another building society and withdrew his money. The idea of a 'run on the banks' in a first-world industrial economy seems hard to believe in the modern age, but as little as sixteen years ago in Australia people were taking their money out of financial institutions in fear of imminent collapse
In the first three years of my employment at Midland, companies were going broke left, right and centre. The Corporate Banking division in London created a team devoted to handling problem accounts. It was called the Lending Services Division (yes, really LSD!). As more companies started facing trouble other LSD teams were formed. At the time when the government was telling people to prepare for the European single market in 1992, a great many of our customers were telling us they just wanted to survive to the end of 1991. It was awful. I don't think that younger people who graduated years later know what it was like. One minute someone's in charge of a profitable enterprise of many year's standing, the next it's in rubble around his ankles. It bred in me an awareness that nothing can be relied up, safety in numbers is an illusion and that things can deteriorate very rapidly.
I'm sure that this thinking affects my views in politics. Remember that story about my school history teacher telling me in summer 1987 that I would not see a united Germany in my lifetime? It took three years! With respect to Iraq, it's bred in me an aversion to the sanctions and containment approach. Critics of mine like Roger Kirkham believe that Saddam was contained and that further pre-emptive action was not needed. I instinctively distrust "containment", because I think it gives the container the illusion of permanence, so when it collapses, the 'container' is the one caught unawares, just as the CIA totally failed to forecast the collapse of the Soviet Union and believed that East Germany was the world's ninth largest economy right up until the late 80s.
I'll mention later why I'm sceptical about some of the claims and proposed solution to the issue of global warming. For now I just want to state the reasons why I'm happy to "look at the evidence" and see the exact opposite of what others are seeing. If I can't make you change your mind about the things on which you and I disagree, at least you should know where I'm coming from. The experts and the crowd are often wrong.
_ DY
at 6:02 PM GMT
Updated: Monday, 19 February 2007 8:54 PM GMT
