Q6 Fall 2009
What are you thinking?
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Comment from What are you thinking?
I wonder if Prof Shiller has read "Eelgrass and Depressions," Chapt. 11 in Wyman Richardson's book, "The House on Nauset Marsh."
[The author is of the Boston Richardson family that produced Atty. Gen. Elliott R., (his cousin), hero of Nixon's Saturday night massacre.]
If not, I'll try to paste an abbreviated version in here; failing that, I think he would be well pleased with the insights it may provide along his current line of thought.
Here goes:
"You mean to say that economic booms and depressions are due to emotional factors?" My younger colleague was horrified. Unlike most medical men, he had a firm grasp of the theory of economics and financial problems in general. In addition, he held what might be called quite radical views concerning our social setup. He had been talking very interestingly about national and international finance--the gold standard, debtor & creditor nations, and so forth--and obviously was much upset at my remark. But in spite of a somewhat malicious desire to mix my friend up, I did indeed have a definite feeling that he was making rules and drawing conclusions from an uncertain source--uncertain, because it depended on mass emotion.
To me...
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Deke Ulian Y'50
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What are you thinking?
Comment from Were you born a short-seller?
For more on James Chanos, see Thomas Friedman's column in the New York Times.
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Were you born a short-seller?
Comment from What is behavioral?
For more on this topic, PBS's Nightly Business Report has a rich set of resources from their year-long project looking at behavioral research.
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What is behavioral?
Comment from Do you need a nudge?
PBS's Nightly Business Report has additional interviews with Richard Thaler as well as a rich set of resources from their year-long project looking at behavioral research.
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Do you need a nudge?
Comment from How do you market a global brand?
I found Mr. Hayes's points toward the end of the interview regarding "Authority" in marketing especially insightful. However, I believe it's not so much that authority is holding less sway, it's that consumers are now privy to the idea that authority can be bought and thus they give it less weight.
"Authenticity" is replacing authority in the marketing models I see and measure. Many brands are working to figure out how to buy authenticity and some creative shops are getting it but more are not. When you have a great brand like American Express (which in full disclosure I've been a happy customer of for many years), authenticity can come easy. Mr. Hayes appears to have the confidence in his brand (as he should) to allow the public conversation to happen and even encourage it. The best authenticity is the true authenticity. The fact that a brand is willing to accept this and join the community it created will bring authority back into the game.
Chris Clegg
Sr. Marketing Analyst/ Principal
Portland Marketing + Analytics
http://www.portlandmarketinganalytics.com
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Chris Clegg
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How do you market a global brand?
Comment from Can a bank serve its community?
This is quite a business model here. An excellent combination of the way banks work and the way microfinance institutions operate. The trick lies in controlling greed, i do not think such a bank would be able to provide the kind of bonuses wall street does but then, it would not require a tax payer hurting bailout too.
The only chink in this armor seems to be the PE backing, one which will definitely lead to more profit mongering sooner or later. Think the greed will have to be controlled at multiple levels.
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Vishesh S
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Can a bank serve its community?
Comment from Do you need a nudge?
I have just finished reading Thaler interview and am impressed with how he can make it
so understandable for the everyday economist like me.
I have an interest in savings and investment and after reading the answer he gave to giving an example of how nudges work. I recognized myself when he said many people
just go with the flow and take whatever the default is.
I love the answer to politicians when he said If we don't like the way government is doing it then throw the bums out and elect who will do a better job.
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James Hall
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Do you need a nudge?
Comment from What is behavioral?
Tyler Cowen, economist and a blogger at Marginal Revolution has a new book, Create Your Own Economy. A review by the Enlightened Economist blog expounds on ideas raised by the book, including “people have extremely different modes of cognition and behavior, which behavioural economics entirely ignores. The limitations of behavioral economics stem from its lack of universality….There is, I think, good experimental evidence that some people do respond more like 'rational economic man' than others - and indeed that economists are more likely to fall into that category themselves.”
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What is behavioral?
Comment from Does money change your thinking?
GDP growth in the third quarter signaled an end to the recession. The fact that little has changed for many struggling Americans is evidence for some that GDP has outlived its use as a key economic indicator. The World radio program has coverage of the debate among economists on alternative measures.
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Does money change your thinking?
Comment from Do you need a nudge?
NPR has a story on the origins of behavioral economics with a look at the work of Thaler and Nobel laureate Daniel Kahneman among others.
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Do you need a nudge?
Comment from Do you need a nudge?
The FinanceProfessor blog has a video of a short talk by behavioral finance expert Shlomo Benartzi hitting a number of the key areas where people tend to make irrational economic choices. Richard Thaler is Benartzi’s partner in the Save More Tomorrow program.
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Do you need a nudge?
Comment from Do you need a nudge?
For more about Richard Thaler and Cass Sunstein's book Nudge visit the book's website or regularly-updated blog.
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Do you need a nudge?
Comment from What is behavioral?
Strategy and Business looks at managing with the brain in mind.
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What is behavioral?
Comment from Do you need a nudge?
The IMF's Finance and Development magazine has a profile of another of the founders of behavioral economics, Daniel Kahneman.
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Do you need a nudge?
Comment from Do you need a nudge?
A long article in Prospect covers the role that behavioral research is playing the British politics.
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Do you need a nudge?
Comment from Are we good at making choices?
For more on the SOM faculty involved in this discussion, you can visit their faculty web pages.
James Choi
M. Keith Chen
Judith A. Chevalier
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Are we good at making choices?
Comment from What is behavioral?
Watch Andrew Redleaf’s guest lecture on the efficiency of markets presented in Robert Shiller’s Financial Markets class at Yale University.
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What is behavioral?
Comment from What are you thinking?
For more on Robert Shiller see his SOM faculty page.
In addition, his Financial Markets class taught at Yale is available in its entirety online through Open Yale Courses. It includes a guest lecture by another Q6 contributor, Andrew Redleaf, talking about the efficiency of markets.


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