Uh, didn't Socrates kinda beat hell out of people with this technique back in the day?

True confession: I am a business professor who does not understand the financial crisis. Ask me to explain things like derivatives and I'll look blankly at you. My credentials in economics, negotiation and law should qualify me to speak, but often the news leaves me slack-jawed with confusion. Bring me to a panel discussion, and I'll ask dumb questions. In short, I am a role model. I want my students to be more like me.

Each semester, I introduce my students to a key idea: I want them to join me in the fight against the fear of looking dumb. Overcoming that fear can save them from serious traps.

Ask the dumb questions (Seth Freeman, USA Today, 13 Jan 2009)

See also: Dumb is the new smart ("Public Offering," the Columbia Business School blog)

(via bNet)

Countdown to India's version of Sarbanes-Oxley in 5... 4... 3...

Looks like India is having its very own Enron/Arthur Andersen moment, but this time the players are Satyam and PricewaterhouseCoopers:

The chairman of India’s Satyam Computer Services resigned on Wednesday after confessing to fixing the IT outsourcing company’s books for the past “several” years, the country’s first major fraud case to emerge following the global financial crisis.

In a letter to Satyam’s board, B Ramalinga Raju admitted wildly inflating Satyam’s margins to paint a picture of good performance and retain his management position, in one of the worst scams to have hit India’s outsourcing sector.

“It was like riding a tiger, not knowing when to get off without being eaten,” Mr Raju said, explaining how the fraud got out of control over a period of years.

Satyam is India’s fourth biggest IT outsourcing firm by revenue and is listed in New York and Mumbai, and the scam has rocked the country’s business world.

Satyam chief admits to falsifying books (Financial Times, 7 January 2009)

Maximize *what*?

At Boing Boing, Cory Doctorow points us to a fantastic rant at Crooked Timber:

...I have a real bee in my bonnet about the claim made by Richard Posner that ” The managers of corporations have a fiduciary duty to maximize corporate profits”. It raises a whole load of topics relevant to plenty of my favourite economic hobby-horses as soon as you start to look remotely critically at what the seemingly simple phrase “maximise corporate profits” actually means anyway.

Pretending not to understand the meanings of common English phrases is a stock tactic for creating the impression of profundity (cf philosophers, who are always pretending not to understand the meaning of words like “is”, “would” and “must”). But sometimes you have to do it – my view is that in any view of the world more complicated than a very elementary blackboard model, the phrase “maximise profits” can’t be unpacked into a coherent decision rule which rules out any of the things which Posner talks as if it does. First, let’s look at some things that it can’t possibly mean...

What obligation? Maximise what? (Crooked Timber)

(via)