Dangerous Digits

Many managers have as their primary occupation to make something else: numbers. To make the right numbers—that is, turning in a specified financial performance over a specified period of time—they give directions to hire and fire people, expand or contract capacity, raise or lower prices. At one level, the desire to make the numbers is entirely rational. If we look deeper, however, it might not … [ Read more ]

The Limits of Financial Globalization

If you have 40 minutes and want to learn a great deal about finance, listen (and/or watch) Rene Stulz’s presidential address. He gave this at the 2005 AFA meetings in Philadelphia.

The basic theme of his speech is globalization. He points out that the world is not yet flat and the “impact of financial globabilization has been limited.” Why? “…because of the ‘twin agency problems’ that … [ Read more ]