“He who sees what is now has seen all things.”
ON THURSDAY FEBRUARY 23RD 1995 the directors of Barings Bank hosted a lunch for financial movers and shakers in the City of London. The conversation was animated, much of it focusing on a new venture in Mexico. The directors had “no idea”, a guest said afterwards, that Barings, one of the oldest and most respected banks in the City, was about to collapse. Yet for weeks markets in East Asia had been ablaze with rumours about Barings incurring massive exposure to a mystery client who might default. Why did it not see the danger signals until it was too late?
To make sense of a decision-making environment it is necessary to simplify. Simplification ...