Yes, I know it’s verbose and full of unnecessary tangents — these days in fact I work as an editor, and believe me, I fully second your opinion that the piece needs editing. Not sure it’s worth my time after 4 years though.

Larry is really good at motivating entrepreneurs, sure thing. But when it comes to the academic rigor of his economic analyses of everything, there’s much lacking — and much that is subjective but he spins as fact.

Your article brings up some good points, but it is way too long and badly in need of an editor. And I feel that you are over analyzing Larry’s role and effect on people. I feel that Larry’s main goal is to introduce economic and entrepreneurship principles to young people in an entertaining way and get them thinking about how they can make a difference in world. Larry Smith has been doing a fabulous job of this for over 20 years.

Thanks for your comment. This post is over two years old yet keeps drawing comments now and then. Your picturesque descriptions of the vapid RCH room bring back long forgotten memories of university life!

What Larry has been saying a propos the financial meltdown is par for the course. Indeed, the idiots need to be fired, their industries (risk management) be whittled down to size, and everything should be rearranged just as Larry dictates,… because, you know, he knows best and everyone should pay attention.

Pff… there are more slip-shod diagnoses of and prescribed solutions to the financial crisis there are out there than there are disaffected economics/finance professors stricken by a God-complex.

I wouldn’t trust Larry Smith to manage my portfolio, nor do I trust anyone he deems qualified and “smart” enough to model risk “CORRECTLY.” Most people don’t know two shits about what risk actually entails, wild uncertainty, fat-tail distributions, un-modelable chaos (check out the Black Swan or the (Mis)behavior of Markets for a taste of what I am talking about). And there is certainly no central authority of knowledge or expertise. Larry’s guess is as good as mine and as good as any of the idiots’ he deplores. If he favored free-enterprise, he would be free to gamble his money away as he wishes, and let others be free to do the same.

Not doubting that there are overpaid pedants in the financial industry who don’t know what they are doing. They’re in fact a dime a dozen. But it’s easier to criticize others’ failures than it is to do better yourself. But when you don’t actually have to try, are shielded from failure and responsibility, and only blow smoke up the asses of gullible undergrads, what’s to shame you from claiming you could do better than anyone else?

Angela Trimiarchi does ring a bell, not a very melodious one. Seriously, university is a joke, unless your major is engineering, law, medicine, or any of the professions. For everything else, more wisdom can be gleaned from leisurely reading by from classes that can be passed with honors from a weekend’s worth of cramming.

Anyways, although this is the first Larry Smith talk I’ve ever been to (I’m in year 4 now), throughout this 1.5 hour presentation I can definitely see truth to the things you mentioned in your blog post.

This is the summary of what he talked about:
He basically dramatized the whole financial fiasco (for an agonizing hour) and said that, based on “pure brute logic”, the market will sooner or later weed out all the “intermediaries”, which he vaguely referred to as the people who connect lenders and borrowers, and also include the people who perform risk assessments. All those middlemen, he claims, are deliberately making things overcomplicated so that they can basically exploit their clients’ ignorance (CDOs come to mind). When the day the intermediaries are put back in their place so that people who could model risk CORRECTLY are the only ones earning big bucks, it will also be the time when there are great opportunities and there will be a lot more direct access between lenders and borrowers in the market. Of course in the middle of all this he kept on bashing those people who were getting fat paychecks and not doing their jobs right.

Here’s my rant:
The first hour was unbearable in that stifling RCH 301 room that was overpacked with people (there were people standing all around the walls and sitting on the steps), since what could have been a perhaps 20-minute wikipedia read was stretched to an unbearably uninformative diatribe (since I’m assuming any dimwit interested in finance, which this talk was obviously catered to, would know all of the basics). His argument was so general that it didn’t really amount to anything, and what I found really annoying was that the crowd just absorbed every little anecdote he threw out. Not to mention that his response to the question in the purpose of the talk was basically, as I paraphrase: Things might f up soon, so if you’re not smart/innovative you’re toast. Also, regarding the issue of removing intermediaries, which Larry hinted also included the exchanges, someone at the end of the talk asked him what he thought about the idea of “Google Broker.” Now, I found that extremely irritating. Yes, Google’s got a great search engine, but replacing the exchanges? Give me a break. Pretty much everything else after the search engine that Google “developed” were really just products from tech firms they bought out. Okay, aside from the fact that the guy was obviously a Google nut, the question itself – posed in front of an audience of over around 200, was clearly trying to fish for some petty praise from Larry (he responded that that was a neat idea but he doesn’t know how it’ll fare). I have a feeling that that guy is a Larry zealot you mentioned.

Sorry for the rant, it’s 4am and I just felt like getting that 1.5 hour of bullshit out of my system. I’m glad I didn’t take any of my ECON 100 or 200-level courses with Larry and just stuck it out with those shitty lecturers (does Angela Trimarchi ring a bell?). At least skipping all those classes meant that I got a full course credit with only about 2 full days of work, not to mention a pretty decent mark too.

By the way, I really like the way you write.

My background is Albanian. My last name ‘Gjermani’ means ‘German’ in Albanian.

I was just wondering what your background is? Your last name sounds very familiar to me!

Thank you!

I had no idea that he has blatantly mis-advertised his qualifications like that! That’s very shocking…

I could always tell he was presenting himself as far more knowledgeable than he really was (especially some of his analysis of Google’s business plan revealed that he had no idea how their adsense works) but if true, all these things you are telling me about him would really undermine any respect I still have for him.

I also noticed he saw nearly everything through a Keynesian lens, but I wasn’t sure whether that was because he didn’t know anything else, or just preferred Keynes above all else.

I am finishing up my degree right now. Taking my last exams through distance education. I am also working on my Senior Honour Essay, which will be a very non traditional approach to monetary policy. If you’re interested, I could forward it to you when it’s finished.

I love economics and I love math, but I have become increasingly convinced that they do not mix as well together as I’d like: i.e. mathematical models of economic phenomena are often so stunted that they’re practically useless for prediction purposes. … which is why I didn’t go the doctoral route in Economics.

Since I live in Manhattan, it will be good for me to get into the investment banking industry here. I also want to go to law school and get an MBA/JD soon.

So I’m more of a practical person. UCL is a good school. Don’t you find London outrageously expensive though? What do you plan to do after your PhD?

Tace care,

Kejda