Mission

Finance lies somewhere between Accounting and Economics.  Like Accounting and unlike Economics, Finance looks inside the black box of the firm, the fund, and the investment strategy.  Like Economics and unlike Accounting, Finance is concerned with the relationship between the firm, the fund, and the investment strategy on the one hand and the world market on the other hand.

Here, we explore the why of Finance, as well as the what and the how.

In particular, all action is ultimately individual human action, and all expectations and plans are formed under conditions of uncertainty.  The future is unknowable, even though it is not unimaginable.  Conversely, individual humans live in society with the great mass of humanity, and the decisions of CEOs, CFOs, entrepreneurs, traders, analysts, etc. are made within the context of social, legal, and cultural norms.

The ultimate goal of the manager of a firm, fund, or investment strategy is to maximize profit… within the constraints of social, legal, and cultural norms.

The world economy is becoming increasingly integrated, even as civilizations clash in the process like tectonic plates, which cause devastating earthquakes, as well as build beautiful mountain ranges.  At the same time, economies are transitioning away from agriculture and manufacturing and toward knowledge and services.

Our mission here is to analyze these issues in the hopes of becoming more effective decision makers in a world rife with hypocrisy.

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4 Comments

  1. Steve Foerster says:
    19 December 2008 at 15:09

    That was wonderfully descriptive. You’re making me wish I’d studied Finance instead!

    Reply to this comment
  2. Jeffrey Deutsch says:
    14 October 2009 at 8:05

    Good morning Charlie,

    “[U]nlike Economics, Finance looks inside the black box of the firm, the fund, and the investment strategy….”

    *Ahem* - you and I know at least one Economics program in America that does that, no?

    Any thoughts on this year’s Economics Nobel Laureates?

    Cheers,

    Jeff Deutsch

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  3. CWE says:
    14 October 2009 at 8:32

    I expect that Microeconomics classes at some universities have sections that overlap with Corporate Finance, but the number is exceedingly small.

    However, your point is taken. Many areas of cooperation exist between Finance researchers and Austrian School economists. In particular, both are self-consciously aware of time, physical distance, and methodological individualism.

    Politically, members of the two groups should be able to get along with each other, as well.

    Sadly, the two groups seem to be oblivious to each other.

    A third group of potential interest is researchers in Economic Sociology.

    Reply to this comment
  4. Cectjincink says:
    25 February 2010 at 11:29

    The response to local and national disasters is awesome but it’s a damn shame that so many citizens take advantage of the sad situations.

    I mean everytime there is an earthquake, a flood, an oil spill - there’s always a group of heartless people who rip off tax payers.

    This is in response to reading that 4 of Oprah Winfreys “angels” got busted ripping off the system. Shame on them!
    http://www.cbsnews.com/blogs/2009/08/19/crimesider/entry5251471.shtml

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