Wednesday, March 11, 2009

Cassandra Redux 

It seems after every major disaster, such as the present, there is recognition of a study, report or other forecast that predicted it. Of course, it is nearly always a document to which no one paid much attention at the time it was released. This is the case with the collapse of derivatives. There was a government study from 1994 that warned of the dangers accruing to the misuse of derivative instruments.

Cassandra was the mythical figure of ancient Greece who foresaw the future correctly but was condemned by Apollo never to be believed. The Greeks were explaining a fundamental flaw of human nature -- the herd instinct that proceeds thoughtlessly into danger.

There will always be Cassandras -- frustrated forecasters who watch disasters form and strike an ignorant public. As PR practitioners, we should learn to consider risks and to account for them in counsel and communications. We often don't because we're part of the herd.


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