26 March 2009 - trust

Trust is crucial in financial transactions, and there are two ways to gain trust. One is to be open and transparent, which doesn’t work in the long run because when you are the first to report bad news your counterparties will bail. The other is to be Bernie Madoff and report all good news all the time, which doesn’t work in the long run because you get caught. Therefore no solution exists and the financial world is doomed to go down in fiery ruin. Remember, you heard it here last.