Wednesday, March 09, 2005
April is the
cruellest month, breeding hopefuls
out of the dead land -- T.S. Eliot & Dr. James Rigali
Alan Greenspan, the Wizard of Blahs, is a classic tin god who could, if he bothered to open his eyes and follow baseball management practices, achieve a lot better results in his job. Greenspan, who heads the Federal Reserve System, is the driving force behind one metric that helps shape the economy. His decisions there have been sometimes good for the economy, sometimes abject failures, but quite one-note. If he would take the time to sit at the feet of the Texas Rangers' manager Buck Showalter, he could get a significant uptick in his performance.
It's because Showalter has a better grip on "irrational exuberance" than the OCD-behaving, binary-bound Greenspan.
According to a story in today's Ft. Worth Star-Telegram:
I thought it was only sportswriters and fans, but Showalter says it's also a baseball tradition to overreact to what's seen in spring training.
"It's the same with every team in March," he said. "I call it the positive and negative feeding frenzy syndrome. You get high on a guy, or you get down on a guy, based on one game or one week.
"My staff meetings are funny. We spend a lot of time settling everybody down, one way or the other."
Showalter is the rudder that keeps his staff from skewing off extremes based on either a single ability or limitation, a single success or failure, a passion for some narrow sub-component of an element of success. This protects them from binary thinkers' messing up decisions. The binary thinker's motto is If A is Bad, then the opposite of A is Good. Greenspan, of course, is the poster boy for binary thinking.
GREENSPAN'S BINARY BINDINGS
Unlike Buck, Alan is emotionally bound to three binary illusions: (1) That one extreme tail of an environmental continuum is more beneficial than the other extreme; (2) That one single metric is more important than all the rest combined; (3) That protecting the interests of one special interest group is more important than all the rest combined.
Because Alan's personal tendency is to be hyper-turbo-vigilant against inflation (not deflation), he views the world with a simplistic one-tailed chart. And because his view is based on a somewhat disproven theory that the root cause of inflation is uptick in dollars earned through performing work (payroll, paychecks, wages, salaries) and opposed to an uptick in dollars earned from investments, his urgings end up delivering results that sometimes don't match his mission. And because he has his hands on one of the levers of a giant complex endeavor, he has come to believe his lever (significant control over interest rates that in turn have a small but usually-significant effect on inflation) is the most important lever in the world. His own irrational exuberance for manipulating interest rates in the service of preserving lenders' margins (a worthwhile endeavor) has made him miss half the equation, has enhanced his binary thinking bias.
Showalter, being more capable and functionally intelligent in the real world than Greenspan, he isn't bound to Alan's irrational exuberance or irrational inxuberance, fear of or passion for one thing. Just because pitcher Kenny "Ruby, Don't Take Yer Slider to Town" Rogers hits a couple of homers in Spring Training games, Buck won't be pencilling him into the regular season line-up at D.H.
Baseball management know how to flex, change with the times, in most cases to overcome disproven biases it brought to the table. If only the people who try to steer the economy had the same open-minded flexibility and eyes wide open ability to avoid the irrational.
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