Nassim Taleb famously wrote two books --- Fooled by Randomness and The Black Swan --- about how incredibly complex prediction models can spectacularly fail if just a few underlying assumptions are incorrect. One of Taleb’s targets was a financial model referred to as “Value at Risk,” or VaR. This model attempted to quantify, using historical measures of volatility as a proxy for risk, the maximum amount of money a firm or portfolio could lose over a certain period of time. Many commentators and analysts now believe that a foolish over-reliance on risk-management models like VaR was partly responsible for the 2008 financial crisis.
1:27 AM 06/21/2010
Newly released e-mails from the Clinton Library paint Supreme Court nominee Elena Kagan as a brash and often creative political operative. As a lawyer and political adviser in the Clinton White House, Kagan often opined on touchy topics, including guns, race and Hillary Clinton's official policy role as first lady.
