In Michael Lewis’s book Going Infinite, there’s this great (and completely true) story about a mega powerful Wall Street firm that used extremely effective statistical calculations to guess the result of the 2016 election. They knew before anybody else that Donald Trump would win the presidency. Statistics worked! Algorithms worked!
But then the human factor came into play. The fancy Wall Street guys detested Trump. (Obviously). So they assumed that his win would tank the market. They bet heavily on that, making gigantic trades on what was, in fact, simply their irrational emotional response to Trump.
They ended up losing hundreds of millions of dollars. All those algorithms, all the data, the calculations. The supposedly autistic, unemotional MIT physicists hired to be traders. The absolutely correct information about the Trump win obtained scientifically hours before anybody else in the world. All sacrificed for an irrational, childish dislike rooted in herd mentality.
So for those Wall Street fellows, the day after the election was not only emotionally devastating but financially crushing. They bet on their fee-fees and lost. It was the largest single loss in the company’s history but the CEOs didn’t punish the traders. They understood and shared the wounded feelings that had caused the mistake.
This is just absolutely hilarious. 🦬 🦬 🦬
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