Description - The Number That Killed Us by Pablo Triana
A critical look at the risk measurement tool that has repeatedly
hurt the financial world
The Number That Killed Us finally tells the "greatest
story never told": how a mysterious financial risk measurement
model has ruled the world for the past two decades and how it has
repeatedly, and severely, caused market, economic, and social
turmoil. This model was the key factor behind the unleashing of the
cataclysmic credit crisis that erupted in 2007 and which the
effects are still being felt around the world. The Number That
Killed Us is the first and only book to thoroughly explain this
hitherto-uncovered phenomenon, making it the key reference for
truly understanding why the malaise took place.
The very number financial institutions and regulators use to
measure risk (Vale at Risk/VaR) has masked it, allowing firms to
leverage up their speculative bets to unimaginable levels. VaR
sanctioned and allowed the monstrously geared toxic punts that sank
Wall Street, and the world, during the latest crisis. We can
confidently say that VaR was the culprit. In The Number That
Killed Us, derivatives expert Pablo Triana takes you through
the development of VaR and shows how its inevitable structural
flaws allowed banks to take on even greater risks. The precise role
of VaR in igniting the latest crisis is thoroughly covered,
including in-depth analysis of how and why regulators, by falling
in love with the tool, condemned us to chaos. Uncritically embraced
worldwide for way too long, VaR is, in the face of such
destruction, just starting to be examined as problematic, and in
this book Triana (long an open critic of the tool's role in
encouraging mayhem) uncovers exactly why it makes our financial
world a more dangerous place. If we care for our safety, we should
let VaR go.
Contains controversial analysis of the hotly debated risk
metric Value at Risk (VaR) and its central role in the credit
crisis
Denounces the role of regulators and academics in forcing the
presence of the inevitably malfunctioning in financeland
Describes how bonus-hungry traders can use VaR as an alibi to
take on the most reckless of bets
Reveals how the most recent financial crisis will simply repeat
itself if the problems behind VaR are not unmasked
Pablo Triana is also the author of Lecturing Birds on
Flying
The very risk measurement tool that was intended to contain risk
allowed financial firms to blindly take on more. The model that was
supposed to save us condemned us to misery. The Number That
Killed Us reveals how this has happened and what needs to be
done to correct the situation.
Buy The Number That Killed Us by Pablo Triana from Australia's Online Independent Bookstore, BooksDirect.
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