Murray Teitel

This doesn\’t bode well, does it?

I am not an economist. Even as an undergraduate, I didn\’t take one class in economics or political science. Instead, I took courses that had more relevance to real life and were of more practical use: The Idealism of Plato, Medieval Proofs of the Existence of God and The Dialectics of Hegel. I wouldn\’t know how to go long, much less short, or the difference between a call and a put. I\’m not interested in derivatives of securitised, collateralised, complex commercial transactions, and I wouldn\’t know asset-backed commercial paper from toilet paper.

Not if you\’re then to go on and describe how to fix the economy.

When financial transactions become an end in themselves, and goods and services exist only to enable financial transactions (rather than the other way around), as sure as night follows day you are headed towards an economic catastrophe.

Ah, I see, you don\’t understand what the financial system exists to do.

It\’s really about two things. Firstly, the moving of risk from those who don\’t want it to those who do. For example, farmers selling wheat futures moves risk from the farmer to the speculator. The existence of a bank moves risk from the depositor (well, almost all of it anyway) to the bank shareholders. Pension companies, annuities and the like from the long term saver to the shareholders of the pension company.

Secondly, about intermediating in the time preference differences between depositors and borrowers. Banks, by definition, borrow short and lend long (I think it was Brad DeLong who said that if you borrow short and lend long then you\’re a bank, if you don\’t, you\’re not).

From those two basic ideas you can build pretty much the entire financial sector. And you have to be very careful indeed about insisting that this or that not be allowed in the financial sector for you\’re at risk, high risk, of stopping people being able to do these two highly desirable things.

15 thoughts on “Murray Teitel”

  1. The dialectics of Hegel and the medieval proofs of the existence of God are more relevant to real life than whether you can get a mortgage or not?

    Twat.

  2. The dialectics of Hegel are extremely useful if you want to prosper at the expense of others by joining the class of twats who read the Guardian and, as a class, run western countries. It’s the equivalent of the older presumption that a person must be suitable to wield power because they can read Homer in the original Greek.

  3. The study of philosophy – unlike, say, maths, business studies or engineering – requires one to demonstrate that one isn’t a complete and utter fuckwit incapable of making or understanding a logical argument.

  4. “Yeah, those mathematicians always have a blind spot as far as logic is concerned.”

    (sound of me tearing up my course notes on deontic logic)

  5. View from the Solent

    “Let no one ignorant of geometry enter”
    Legend has it that this motto was inscribed over the door of Plato’s Academy.
    Us mathematicians would have been allowed in. Doesn’t sound like Murray Teitel would have been very welcome.

  6. Logical argument and mathematical logic have absolutely piss-all to do with each other, as any honest mathmo would admit. Or at least, no more than astronomy and astrophysics – both worthy, both vaguely related, but no crossover in required skills.

  7. I know that I should not feed the troll, and yet…
    As a PhD in mathematical logic, I can testify that “being able to understand a logical argument” is the bare minimum prerequisite for doing mathematics.

    On the other hand, it is a self-evident truth that a sound knowledge of the proofs of the existence of god is one of the most valuable assets on dealing with practical questions.

  8. John’s sometimes good on economic points, but I have just understood what the problem is with his other arguments: a failure to understand the difference between logic, which is identical wherever it is encountered, and sophistry, which is only found in philosophy.

  9. The second paragraph quoted is a paraphrase of one of the most famous passages in Keynes, you almighty fool.

    Tim adds: Well, there’s me with egg on my face then. Glad I used the example of commodity futures….Keynes being an enthusiastic dabbler in them and thus they presumably not just financial transactions for the sake of them.

  10. “Logical argument and mathematical logic have absolutely piss-all to do with each other, as any honest mathmo would admit. ”
    “The study of philosophy – unlike, say, maths, business studies or engineering – requires one to demonstrate that one isn’t a complete and utter fuckwit incapable of making or understanding a logical argument.”

    Sometimes, the incorrectness of your statements is surpassed only by the confidence with which you make them. Not only are you as often as not wrong, but you are more often than not rude and smug about it too.

  11. The history of Western philosophy can almost be summed up as a series of attempts to measure up to the standard of mathematical logic. And failing miserably. I don’t think they’ve really moved on since Wittgenstein tried, then gave up.

    Not that isn’t a useful technique for evaluating textual arguments.

  12. I get the bit about the problems arising from financial transactions becoming an end in themselves (i.e. speculation) but I don’t really see what’s meant by goods and services existing only to enable financial transactions.. what does that refer to?

    N.B. you can make the argument that speculation reveals information that is helpful to the real economy, which does not preclude it also cocking things up.

  13. @11, if it wasn’t for the fact that I was correct, then perhaps you’d have a point. The skills required to evaluate mathematical logic simply *don’t* translate to verbal argument.

    There is a useful crossover between the disciplines, and the occasional Bertrand Russell type who’s a genius at both can contribute immensely by cross-pollination – but maths tells you nothing about evaluation of sources or about resolving linguistic ambiguity, which are the main skills required for actual debate.

  14. Pingback: Nemo Dat Quod Non Habet - Charles Crawford

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