Is I.T. Responsible for the Economic Crisis?

I work in Information Technology, so I am sharply aware of the dangers inherent in a badly-built set of systems. It is not just the risk of the Blue-Screen of Death that Windows users are familiar with, or the spinning beachball that haunts Apple users. Even a system that never crashes can be a danger to your business if it doesn't get you the info you need, when you need it. A logical question then, is whether better I.T. systems could have prevented the Economic Crash.

This fragmented IT landscape made it exceedingly difficult to track a bank’s overall risk exposure before and during the crisis. Mainly as a result of the Basel 2 capital accords, many banks had put in new systems to calculate their aggregate exposure. Royal Bank of Scotland (RBS) spent more than $100m to comply with Basel 2. But in most cases the aggregate risk was only calculated once a day and some figures were not worth the pixels they were made of.

During the turmoil many banks had to carry out big fact-finding missions to see where they stood. “Answering such questions as ‘What is my exposure to this counterparty?’ should take minutes. But it often took hours, if not days,” says Peyman Mestchian, managing partner at Chartis Research, an advisory firm.

Of course, it never helps to blame technology for the failings of human nature and human decisions. But poor human decisions about technology can lead to even more poor human decisions. Quality counts.

Have you heard of "Wolfram Alpha"?

After the carpet-bombing of tech blogs, I had assumed everyone had already heard of Wolfram Alpha, but in a few conversations with non-techie friends I am learning it is still news to many. This new search engine is an attempt to provide a true alternative to Google. Instead of providing links to web pages in its results, Wolfram Alpha takes a more semantic approach to information and tries to answer the underlying question directly. For example, if you search for "freezing point of water", you get: 0 degrees Celsius along with a series of common conversions to other temperature standards. The same query on Google brings up a list of articles from Wikipedia and the like on the phenomenon of freezing.

Which is better? Ultimately, it depends on what you are looking for. For 99% of what I need a search engine for, Google provides a better summary of the "collective wisdom and knowledge" of the web. But there is that 1% time when I need pure dry facts and Wolfram Alpha provides those quickly and without clutter. I suspect Wolfram Alpha will become a favorite of primary school math and science students looking for exam answers, for example. Still, Wolfram is in the "alpha" stage of development (i.e. the earliest stable form) and may grow into something bigger. It is worth watching and waiting to see.