"Economists desire to be able to explain 99% of all economic phenomena with three laws," says MIT Sloan Prof. Andrew Lo in a discussion on why economists envy physicists. "That's what physicists can do [in physics]. In fact, [in economics] we have 99 laws that explain maybe 3% of all phenomena"...
Recently, the National Science Foundation sent out a query asking economists and social scientists to draw up "grand challenge questions that are both foundational and transformative"—a request that Andrew Lo, says is a first in his experience.
MIT Sloan Prof. Andrew Lo, manager of the Natixis ASG Managed Futures Strategy Fund, advocates vigilant oversight of Managed Futures products, to limit the risk of abuse. "The regulations need to be toughened up even more," he said. "There's all sorts of opportunities and potential for abuse if we don't manage this carefully."...
MIT Sloan professor Andrew Lo says that quant managers need to focus on the adaptation to changing environments that characterizes the biological realm, rather than the sort of immutable laws that form the foundation of physics.
In a discussion of the Chartered Financial Analyst (CFA) designation, Andrew Lo's presentation at a London CFA conference is highlighted as an example of how the CFA is adapting to changing conditions.
A workshop sponsored by America's National Science Foundation at which economists explored the potential of "agent-based models" (ABM) is highlighted. Professor Lo presented a model of the American housing market, inspired by ABM approaches, which showed how a fateful conjunction of rising house prices, falling interest rates and easy access to refinancing created an awesome burden of debt.
Andrew Lo likes the diversification that timberland investments bring, saying that the returns correlate less with, say, United States stocks than Western European stocks would. As a result, timberland might help to prop up the value of a portfolio during a bear market.
...Many of us are in deep mourning—for big stock losses going back to 2008. And our sorrow is so similar to what we feel after divorce or death in the family that we're likely working through the five stages of grief, says Andrew W. Lo, a finance professor at MIT who has studied investor behavior.