Seven Bad Habits of Risk Management

I’ve spent the last few weeks reading through the report of an investigation into the default of Archegos Capital Management. The report was prepared by and for the Board of Directors of Credit Suisse, the Swiss investment firm that lost $5.5 billion when Archegos defaulted. I really wish I could report that the Archegos default was completely out of the blue, that Credit Suisse was in innocent…

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26 July: Hoping for the Best

The fallout from the recent Supreme Court decision in NCAA vs. Alston continues. On July 1st, a number of state laws allowing for various forms of athlete compensation went into effect. Within hours, athletes began inking name, image, and likeness (NIL) deals. The grab for cash is on. If you thought that the last year of collegiate athletics was a fiasco, you were right. If you think the future…

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28 June: Inertia, Stability, and Change

COVID wreaked havoc on the college football season last year. As July turned to August, schools and conferences around the country debated the safety and propriety of playing in the fall. The Ivy League canceled their season but the SEC played a 10-game, conference only schedule. No fans were allowed at many games; some fans at others. Let’s look back at the world of 2020 and see how things have…

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21 June: Vaccines and Behaviors

By late July of last year, we were in uncharted territory. It became clear that the pandemic would drag on longer that most of us anticipated. The masking of American society was just beginning in earnest, but the best masks could do was slow the spread of the virus. When Pfizer, Moderna, and Johnson and Johnson all announced that they had developed vaccines, reactions were a mix of cynicism…

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14 June: Emerging Work and Unemployment

The economic shock that was March 2020 created a tsunami of unemployment claims. Between March 15th and May 31st of 2020, 30.3 million Americans became unemployed. During the last week of April 2020, 3.84 million people lost their jobs, 14 times the rate of job loss the week before the lockdowns began. Weekly jobless claims would stay above 1 million through July and would not drop below 500,00…

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24 May: Evaluating Fallen Dominoes

The domino effect is a simple concept: a change to any one element of a system ricochets around the system and causes changes to other elements. Some changes are benign, some harmful, and still others helpful. The Coronavirus lockdowns represented a shock to global supply chains and have led many leaders to rethink where, when, and how they purchase inputs. A system that was designed to be hyper…

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