Tuesday, 14 April 2009

Hernando de Soto on Anglo-Saxon education

One of the themes of the book that I am currently writing is the challenge now being faced by the dominant financial model of the last 250 years - the Anglo-Saxon banking model or to extend that notion to just the 20th century and beyond the financial technocracy model promulgated by the Axis Of Spin - London And Washington (New York).

Hernando de Soto is an non-mainstream economist who has been making some very perceptive observations about the nature of the global financial meltdown. Most recently he wrote an op-ed piece in the Los Angeles Times in which he touches on one of the most egregious features of the crisis - i.e. the fact that the magnitude of the toxicity on the balance sheets of the banks has not (can not) been quantified.

The article is well worth reading but I shall just give some context as a teaser to one of the themes which is being developed in my own thinking at present.
As a Peruvian educated by British and American teachers, I learned never to embark on a major task without first "doing the math." No more of that Latino "happy go lucky, trust your gut and say three Hail Marys" approach to life.

Without measurement, my teachers advised, I wouldn't be able to identify and disentangle the very reality before my eyes. By doing the math, I would see order and coherence, the way things were organized; invisible relationships would come into view, and right behind order would come meaning, followed by confidence. Thanks to my Anglo-Saxon education , I learned the lesson: You cannot manage what you have not previously measured.

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