Risk News

Rethinking Risk and Uncertainty

"What is risk? Think about it before you leap to answer. Do we really know and understand risk?"

Annie's take:

There are just not that many big thinkers around risk, so it's a pleasure to highlight the work of Geary Sikich, who is introducing some new definitions in this piece.

The FTC beefs up technology investigations with new office
Annie's take:

One Year Later, Ebola Outbreak Offers Lessons for Next Epidemic

"One year has passed since the declaration of what became the largest Ebola outbreak in history, with more than 10,000 deaths."

Annie's take:

Even as we seek to extract the lessons learned, it's not clear (at least to me) that this epidemic is over.

Ways to Put the Boss’s Skin in the Game

"Life is not fair, I know, but this is getting ridiculous."

Annie's take:

As banks get into more and more trouble with regulators, Ms. Morgenson has become pithier in her analysis. There is no mistaking what she is saying here.

Why Islam Needs a Reformation

" “Islam’s borders are bloody,” wrote the late political scientist Samuel Huntington in 1996, “and so are its innards.” "

Annie's take:

Ali has a new book coming out this week. Even if you don't obtain the book, please read this essay, which seeks to highlight where Muslims of good faith need to reform parts of the belief system that are currently based on a literal reading of the Quran and the kaddith.

Petraeus: The Islamic State isn’t our biggest problem in Iraq

"General David Petraeus, who commanded U.S. troops during the 2007-2008 surge, was back in Iraq last week for the first time in more than three years."

Annie's take:

No matter what view you hold of former general Petraeus, this is an article worth reading. And effective reading this article and a related one, henceforth I will be calling ISIS by its Arabic acronym, Daesh.

The Health Concerns in Wearable Tech

"In 1946, a new advertising campaign appeared in magazines with a picture of a doctor in a lab coat holding a cigarette and the slogan, “More doctors smoke Camels than any other cigarette.” No, this wasn’t a spoof. Back then, doctors were not aware that smoking could cause cancer, heart disease and lung disease."

Annie's take:

I'm still wearing a $20 pedometer and an old fashioned watch. And I'm looking around now to find my Bluetooth headset.

Cyberattack at health insurer exposed data on 11 million customers — including medical information

"Premera Blue Cross, a health insurer based in the Seattle suburbs, announced Tuesday it was the victim of a cyberattack that may have exposed the personal data of 11 million customers — including medical information."

Annie's take:

More than the depth of the personal information stolen on clients, this attack is the first I can recall where the institution had so clearly been warned (in this instance, by a federal auditor) that there were gaps in controls. Will Premara's insurance company cover costs of breach in such an instance?

How to Fight the Next Epidemic
Annie's take:

No single non-medical person is more qualified to offer this advice.

ISIS Is An Operational Risk

"Like you, I am deeply outraged at the increasingly horrific actions of the Islamic State of Iraq and the Levant (ISIS or ISIL), which in late June of 2014 rebranded itself to this designation, announced the formation of the Caliphate and named its caliph..."

Annie's take:

ISIS may seem like a remote operational risk to most businesses, but its tentacles increasingly cross the globe and its recruiting efforts in the United States have been somewhat successful.

Social Facebook Clarifies Rules on What It Bans and Why

"With 1.39 billion active users worldwide, Facebook’s social network is the closest thing we have to a universal communication platform. And people post — or try to post — just about everything you can imagine."

Annie's take:

Look for the community standards announcement today on your Facebook page -- then take the time to read it. As Goel indicates, it's a very complicated world that Facebook navigates.

S.E.C. Wants the Sinners to Own Up

"For decades, the Securities and Exchange Commission has allowed companies and individuals to make settlements without admitting any wrongdoing."

Annie's take:

It will be interesting to track this significant change in the way SEC does business.

The Demonic Wellspring

"ISIS is scaring the daylights out of us."

Annie's take:

This article is ostensibly a review of three new books on ISIS, but the author provides us with a great deal of useful background material in commenting upon them.

Boeing Helped Craft Own Loan Rule

"When the Export-Import Bank sought to respond to critics with tighter rules for aircraft sales, it reached out to a company with a vested interest in the outcome: Boeing Co., the biggest beneficiary of the bank’s assistance."

Annie's take:

Unbelievable, just unbelievable -- especially after the trouble Boeing has been in with cozy relationships inside the Defense Department in the past.

U.S. Banks Pass Stress Tests, Some With an Asterisk
Annie's take:

Corporate peak still out of reach for most women

"Vivien Leigh as Scarlett O’Hara turned her second husband’s general store into a lumber and sawmill empire. As Mildred Pierce, Joan Crawford set up a restaurant chain. Olivia Pope, played by Kerry Washington, runs her own DC-based crisis management firm in Scandal, while The Newsroom’s Leona Lansing (Jane Fonda) owns Atlantic Cable Network."

Annie's take:

This is one article out of a number devoted to in a special section of The Financial TImes to issue of women and business.

The politics of centralizing power in the Fed

"“Washington Strips New York Fed’s Power” heralded an eye-opening Wall Street Journal article last week that detailed changes underway at the Federal Reserve. Typically, the Fed’s Board of Governors in Washington delegates authority to the New York Fed to supervise financial institutions on Wall Street." 

Annie's take:

The fact that most large banks have regulators sitting on the floor next to their own employees causes a coziness that can lead to regulatory blind spots. Evidently the same is true at the Federal Reserve Board level.

What is your reputation worth?

"My reading and research includes white papers from the Big Four accounting firms."

Annie's take:

Reputation risk has never been higher on the list where boards of directors are concerned. In my column, I look at Deloitte's latest global risk survey on this very topic.

Islamic State appears to be fraying from within

"The Islamic State ­appears to be starting to fray from within, as dissent, defections and setbacks on the battlefield sap the group’s strength and erode its aura of invincibility among those living under its despotic rule."

Annie's take:

This is good news, but by no means a cause for celebration. ISIS is the largest and crudest threat we perceive, but as others have pointed out recently, there are a number of splinter groups equally terrifying.

In campaign against terrorism, U.S. enters period of pessimism and gloom

"U.S. counterterrorism officials and experts, never known for their sunny dispositions, have entered a period of particular gloom."

Annie's take:

Your Princess of Darkness agrees with the assessments of the counterterrorism experts. This is a long haul venture, not something like a war that we would presumably win.

ISIS Is Adept on Twitter, Study Finds

"The Islamic State, the violent extremist group that espouses a return to a seventh-century caliphate, has been astonishingly successful at spreading its message using 21st-century social media, according to a study released Thursday."

Annie's take:

There is no doubt that choking off ISIS from social media recruiting -- along with deploying crack cyber teams from NSA to break up their cash flow sources -- would significantly erode what appears to be ISIS's growing sophistication with donation and recruitment tools.

In Eye of Economic Storm, the Fed Blinked

"When Ben S. Bernanke walked into the Federal Reserve’s ornate boardroom in December 2009, the officials who were gathered around the long table gave the Fed’s chairman a standing ovation."

Annie's take:

It is through such transcripts -- and an archive of emails and other correspondence -- that we better understand what decisions our public officials were making for us.

What Hillary Clinton’s Emails Really Reveal

"HISTORY will be the judge: That’s the line leaders often use when making difficult decisions."

Annie's take:

Old patterns of secrecy are hard to break. Does it really matter whether she was explicitly told to use a .gov account for official correspondence? We had all, at that time, watched the president have to wrestle with security advisers on whether or not he could carry a Blackberry. The authors here lay out several troubling trends and the rationale for collecting records for historical purposes.

To Hurt ISIS, Squeeze the Cash Flow

"The fight against the Islamic State must be a multipronged effort, designed to counter the terrorists, their ideology and their murderous strategy on every level."

Annie's take:

I strongly endorse the recommendations made in this editorial. I would add only that I hope we begin to deploy NSA surveillance and disruptive cyber teams to break up the money trading hands in the Dark Web and the Deep Web that funds terrorism.

The Longbrake Letter for March 2015

"It would seem that everything is coming up roses, at least in the U.S. Is this a goldilocks world? In this month's letter Bill Longbrake discusses global mega trends, secular stagnation and global monetary policies, the long-run implications of which appear to be at odds with the short-term goldilocks scenario. Bill concludes that it's hard to say where all this leads but it probably won't be what the consensus expects."

Annie's take:

Bill Longbrake has been providing economic forecasts for most of his career. They're now published publically every month, and here's his take on whether everything is coming up roses everywhere, or not.

At Aetna, a C.E.O.’s Management by Mantra

"On a recent wintry afternoon, Mark T. Bertolini, the 58-year-old chief executive of Aetna, the health insurer, was sitting in his Hartford office wearing a dark suit and a crisp, white, French-cuffed shirt. But instead of a necktie, he wore a shiny metal amulet engraved with the Sanskrit characters “sohum.” "

Annie's take:

Looks like the data is present to support such optional programs for employees.

This bill would halt Congress’s pay if Homeland Security shuts down

"A potential Department of Homeland Security shutdown would directly affect lawmakers’ pocketbooks under a bill introduced in the House this week."

Annie's take:

I am all in favor of this legislation. I just don't see how a bill will be passed in what now is less than a week.