I was always pretty good at math. I loved algebra; it made perfect sense to me, and it was fun to figure out what the values of x and y were. I didn’t like geometry as much, but I still did well in it. Pre-calculus was fine too. And I did well in high school calculus, although in retrospect I don’t think the class was as in-depth as it should have been.
I had to take one semester of calculus in college, because it was a pre-requisite for physics, and I had to take physics as a requirement for my biology degree. (Don’t ask why; I have no idea.) Calculus was a 5 hour class, so we met for one hour every day. I think it was at 11:00 or noon. For the first half of the semester, I did fine; everything was familiar from high school calculus. Then – I hit the wall.
I reached the point in calculus beyond which I did not have the ability to understand it. I hit the math wall. For the rest of the semester, the professor might as well have been speaking Latin. I just didn’t get it. I studied, never missed class, listened to every word and wrote everything down – but I couldn’t understand it.
That hadn’t ever happened to me before, and it was a strange feeling. It was frustrating in a way – not that I really cared about knowing calculus, because I certainly didn’t, but because I didn’t want there to be something that I couldn’t figure out. Of course there are lots of other things that I can’t figure out, but most of those have to do with human behavior. I’ll never get some people, but I thought I should be able to get calculus.
Oh well. I got a B in calculus and went on through college without ever hitting the wall again. Then, 17 years later, I entered business school. I did well in all the classes, even economics, and the required class in finance. But then came investments.
I took investments as an elective, because it was taught by the same instructor that I had for finance, and he was a good teacher and made class enjoyable. At first, I rolled along without a problem, and it was really interesting to learn about the history of the stock market, valuation, and all that. But then we got into options, and I hit the wall again – the finance wall, this time. I still understand how the basic markets work. However, there are a slew of other financial instruments out there, from options through much more complicated things, that are just beyond my ability to understand.
It’s those more complicated things that are causing all the turmoil in our markets and in the investment firms today. I don’t understand most of it, and I bet most of the rest of us “lay” folk don’t, either. What I do understand is that a bunch of guys (and they are mostly guys) who think they’re smarter than everyone else invented a series of financial instruments that could make them a lot of money in the short run, but were doomed to fail in the long run. But all they saw was the money, through the eyes of greed.
Now our economy is hitting the wall. We’re seeing the dark side of the free market economy run amok.
It’s like watching a slow motion car wreck, except for a lot of folks, they’re in the car.