Did Larry Kudlow Get The Best Of Paul Wilmott?

Paul Wilmott is a hot quant/theorist of the Taleb school. He likes to slam Wall Street for its over-reliance on models. He showed up on CNBC to slam Wall Street, attack High-Frequency Trading, and generally preach more gloom.

But Michael Statsny makes a good criticism of Wilmott (one that could also be applied to Taleb), namely that he refuses to say much of anything:

So Wilmott appears on CNBC saying that all those Quant/Risk models are wrong and that banks didn’t learn a thing from the financial crisis and started to use those very same models again. Kudlow then says that if Wilmott knows which models banks use, he actually should know whether they are too bullish or too bearish. Wilmott replies that he has no clue about the direction of the market but that risk is underpriced. And that banks create their own reallity (tail wagging the dog) by using those models. Maybe Wilmott is right, but not providing any facts and coming up with an unfalsifiable theory is just not what you expect from such a smart guy.

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