I once described this book as the most frightening book in finance. Watch this video to see why:
It is astonishing and beyond belief that the financial “geniuses” of the world turned something like a “crash” in the housing and stocks markets into the most unlikely thing that could ever happen!
As John Lanchester explains in his book “Whoops! Why Everyone Owes Everyone and No one Can Pay“, financial institutions had expressed a crash as a “25 sigma” event. Sigma is a measure of how unlikely something is. A 1 sigma event is more likely but a 25 sigma event would be almost impossible!
What are your own thoughts on this subject? Why do you think the crash of 2008 was considered to be such an unlikely event? Leave me your comments below.