Dice Have No Memory: Big Bets and Bad Economics from Paris to the Pampas

Introduction

It was 10 years ago, or a bit more, that I began writing the Internet series called the Daily Reckoning. The collection of essays and short notes you have in your hands developed over the course of the years that followed.

When I began, I was ahead of the innovation curve. I was blogging before blogs had been invented. Day after day, I watched what happened in the world of finance, economics, and politics. And day after day, I found myself entertained. I merely described what I saw happening.

This was something fairly new in the press. Journalists believe their job is to report the facts, not to laugh at them. Even the commentariat and editorialists believe they need to take the news seriously; who will buy their papers and magazines if they make a joke of it? The lectorat, too, had become convinced that the world of finance, investments, and economics was serious business. Many believed that the latest developments—both in technology as well as in financial theory—would make them rich. They had heard that the Internet made wealth secrets available to everyone. You could now go onto the Internet to find out how to make a nuclear bomb, or a fortune. “Stocks for the long run” seemed like an almost risk-free road to riches. Readers weren’t going to pay someone to mock their ambitions and undermine their hopes.

But the Daily Reckoning was free. Readers could not complain that they were not getting their money’s worth.

The period began with a bubble in the dot.com stocks. ...