Uncategorized

Subscribe to Uncategorized via RSS

Joshua Fershee started a conversation about incompetent male leaders, so in keeping with that theme, here are a couple of other interesting data points.

First, a new study shows that male loan officers are more willing to lend money to other men – especially men they bond with.  (Bloomberg story here; paper here).  That doesn’t work out so well for the banks; these loans are more likely to default.  Women loan officers do not suffer from the same bias.

Second, another study shows that male analysts are biased in favor of male CEOs – again, an effect that doesn’t hold for women.  (WSJ story here; paper here).

The critical point, for me, is that these biases exist even though they are unprofitable (in short term thinking, anyway; they may be very profitable for men as a group, long term).  It’s an obvious point but it bears repeating:  prejudice resists evidence.  The market cannot cure problems that prejudice bars it from perceiving.

As for why women do not, in these studies, suffer from the same bias (or do not suffer to the same degree), it’s not that women are especially rational as compared to men; it’s…

If you’re like me, you’ve been absolutely riveted by the disaster that was Fyrefest.  For anyone who somehow missed the news, the basic recap is that a destination music festival – sold as a luxury getaway in the Bahamas featuring sandy beaches, rock stars, five-star accommodations, and gourmet meals turned out to be, well –

Instead of luxury villas, guests found soggy tents, port-o-potties, and a bank of lockers (without locks).  They had to hunt for their luggage in a large shipping container – with flashlights.  And so forth.

There have been a number of news articles attempting to deconstruct how things went so horribly wrong, but the focus of my particular interest is – incompetence or fraud?  There are already two class action lawsuits pending, so we’ll have more information soon enough, but reports so far indicate a rather stunning willful-blindness on the part of the promoter – 25-year-old Billy McFarland – coupled with the somewhat-contradictory fact that he’s still around, apologizing to disappointed ticketbuyers, and generally not, you know, running off to a country with no U.S. extradition treaty.

[More under the jump]