The Political Orphanage The Library of Mistakes
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Jan 8, 2025 
Russell Napier, the Keeper of the Library of Mistakes in Edinburgh, has spent 30 years advising on asset allocation. He discusses how learning from historical financial errors can enhance decision-making. Napier contrasts neoclassical and behavioral economics, arguing for a more organic understanding of economic systems. He critiques banking regulations, explores pension fund mandates, and highlights gender differences in investment strategies. As he navigates future tech challenges and financial strategies, his insights on AI and cryptocurrencies spark a blend of caution and optimism.
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Focus of the Library
- The Library of Mistakes focuses on human decision-making under uncertainty, especially in finance.
- It aims to expand this study to other areas like the military.
Mechanisms, Not Predictions
- The Library of Mistakes focuses on understanding the mechanisms of financial history, not predictions.
- Studying these mechanisms can improve forecasting but isn't about extrapolation.
Group Psychology in Finance
- Behavioral finance usually focuses on individual psychology, but the Library of Mistakes emphasizes group psychology.
- Group dynamics significantly affect financial decisions.
