Greed, ignorance and appreciation of risks....

TODAY had a opinion piece by a financial consultant entitled "Ignorance and Greed", essentially discussing the people who got burnt exposing themselves to high risk investment products. This kinda resonated with my previous post on how we are all biologically designed (condemned) to be incapable of accurately appreciating risks. It's fine for people who didn't get burnt to patronize those who did, but truth be told, many savvy investors (read gamblers) who should know better also got burnt. Were they ignorant? I mean couldn't they see the risks?

But beyond this....it kinda struck me that there is probably a massive amount of commerce and wealth generation that exists in the world, that systematically exploits this biological deficiency we have in risk appreciation. Think insurance policies....fund managers.....preventive health screenings (wealthy cardiologists in big Mercedes!)! Are the premiums invested in these activities appropriate for the size of the risks...? Who knows. Actuarists and epidemiologists give us numbers that no one can understand.

In this regard, the concern of the NMRC in surveying attitudes of trial volunteers fall smack in the middle of this discussion. Clinical trial subjects (no matter how educated) are singularly incapable of appreciating risks in participating in clinical trials, no matter how much we kid ourselves. Gross and irresponsible oversimplification of the process, such as the statements put out by the Straits Times yesterday complicate matters. How can anyone dismiss the risks by saying that "clinical trials are as safe as they can be"? The whole idea of clinical trials to to find out what you do not know. This surely must include the discovery of risks....