__Re: Wall Street__Let's face it: Complaining feels good, and complaining about a financial meltdown that dashed Americans' dreams of retirement feels, well, required. Readers were eager to assign blame for the Depress—er, Recession, and bankers and wonky math types made good targets. But not every finger pointed outward. Lamented one commenter: "We all handed our money to these Wall Street fools." Sad, but true.
Feedback
The March stories that elicited the most reader response. Creative Math
David X. Li's model was, and is, brilliant, but it lost its power with use ("A Formula for Disaster," issue 17.03). Banks were aware of the risks; they just didn't fear the consequences because they believed the Federal Reserve wouldn't allow the banking system to fail (looks like they were largely right). Li's Gaussian copula function provided the returns they wanted, and as long as enough dollars were riding on the model, it won them a guarantor in the form of the federal government. Clever business on the banks' part. We all got played like the village strumpet.
Excerpted from a comment posted on Wired.com by FISCHBONE
I thought that Congress, Fannie Mae, and Freddie Mac were to blame for flooding Wall Street with trillions of dollars of toxic mortgage debt. Now I find that an equation actually precipitated the tsunami of subprime mortgages. Silly me. Absent bad loans, Wall Street quants and rating agencies wouldn't have added to the problem. Banks, ratings agencies, mortgage brokers, et al. were merely responding rationally to the perverse system of incentives set in place by Congress.
Bruce McCullough
Professor of economics Drexel University
Jenkintown, Pennsylvania
Your equation was a little off. The right one is G=R(e)/D, where G is the number of people who are never satisfied with what they have and demand that we "Give them more," R stands for the constant "America's Righteousness," e is the amount of empathy the rich have for the poor (which is always close to zero), all divided by D, the ultimate Destruction of ourselves and the world.
Kevin Costa
San Jose, California
No wonder there were problems with the Gaussian copula function! Its formula as portrayed in the March issue is incorrect: The parentheses do not balance.
Peter Marks
Saco, Maine
Editors are not mathematicians, and apparently mathematicians are not editors: A parenthesis is missing from the formula in David X. Li's original paper. The corrected version appears below.
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On the Edge
Our "Datastream" about knives (Start, 17.03) included the magic glaive from the awesome 1983 film Krull*, but initially we weren't sure we'd be able to get its dimensions (needed for scale). So we called Battlestar Galactica producer Ron Moore for backup: the real, live bat'leth (the Klingon sword depicted left) he keeps in his office. It measures 43.5 inches. In the end, we did track down the son of Krull's producer, who, naturally, owns a glaive—all 12.5 inches of it. That's the thing about sci-fi aficionados: They seem harmless, but they will cut you, man.*
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Reboot the SEC
I enjoyed the article about the value of transparency in identifying fraudulent behavior by the decentralized masses ("The Road Map for Recovery," issue 17.03). I find it curious that we hail free markets as the gold standard of economic models and fiercely object to anything resembling central control of prices and resources. Yet we feel that a central bureaucracy is the best way to regulate a modern, constantly evolving economy. By disseminating information in a standardized format, you can crowdsource the identification of fraud. In the information age, information rules. Make it available. Make it understandable. And make it work for us, not against us.
Excerpted from a comment posted on Wired.com by MICAHLANDIS
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Clear Direction
I was the design director of the Obama presidential campaign, and I want to thank you for "You're Looking at a Box ..." (issue 17.03). Like many who worked on the campaign, I have been feeling slightly aimless and uncertain of the road ahead. Your article inspired me greatly.
SimpleScott
Chicago, Illinois
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Ode to Manipulation
I can't quite connect the dots in your Q&A with Jack Horner ("Revenge of the Birds," Start, issue 17.03). How does tweaking some genes and making dinochickens and Frankenbirds prove creationists dead wrong? God creates, man manipulates. Nothing new here. It has been that way since the Garden.
David Eames
Delmar, New York
Little Jack Horner
Leads the lab on the corner,
Playing with DNA.
He's hooked (like a wino)
On making a dino,
In hopes we'll control genes some day!
Judy Nollet
Eagan, Minnesota
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Cloudy Vision
"The Netbook Effect" (issue 17.03) disregards one point: What happens when you don't have the cloud? Netbooks are great, but they will never replace real laptops or desktops on a mass scale.
Excerpted from a comment posted on Wired.com by MJP
A seven-page article about netbooks? Seriously? Let me sum it up: You can now buy cheap, crappy laptops that do nothing but surf the Internet. You can own what your grandma has owned for years! If the next issue has a nine-page piece about how to sell things on eBay, you and I are done.
Bill Ross
West Lafayette, Indiana
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Style Matters
Why aren't data plural anymore? Do you need an editor?
Glenn Adams
Coronado, California
Data is a plural noun that takes a singular verb in modern usage. Our source? Merriam-Webster's Collegiate Dictionary*. (At $23.95, it's cheaper than another editor.) —Jennifer Prior, Copy Chief*
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