Tucked away in a mews in central Edinburgh . . . is a two-room, book-lined haven, complete with a fireplace and (fake) tulips on the mantelpiece. Also on the mantel: a portrait of Charles Ponzi, who gave his name to the most famous of schemes and bilked thousands of people out of their money in the 1920s.
It’s people like Ponzi (and former currencies like the tulips, which caused a massive financial bubble in Holland in 1637) whose stories animate the Library of Mistakes, a friendly warrior on the side of good governance that seeks to serve as a resource for anyone interested in learning from history’s great financial errors. For Russell Napier, the professor and investment professional who founded and keeps the library of about 4,500 books, it’s a way of fighting back against not just specific idiocies but also against a financial profession that’s turned largely to teaching by the numbers rather than focusing on what history has taught us works … and what doesn’t.
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What doesn’t was illustrated in the 2008 British financial crisis, which Napier says was the inspiration for the library. When it comes to financial education, he explains, it’s “easier to sell the surety of numbers” — getting people to trust you with their money, whether at a personal or systemic level, is easier with algorithms, equations, things that seem unchangeable. But finance doesn’t just run on numbers. Napier, who’s taught financial history for years, argues that it’s through stories — and specifically through cautionary tales — that we’ll find a way to navigate both micro- and macro-economic disasters, avoid getting scammed and maintain sane policies and practices that govern finance.
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But the Library of Mistakes is catching on. A sister library opened in Pune, India, in 2016, and another is planned to debut in Lausanne, Switzerland, before the end of the year — the first that’s expected to include non-Anglophone texts.
Link to the rest at Ozy