May 27, 2010

When “inconsistent” became a curse word…

A lot of times we hear complaints (yes, those posts are related! :) about inconsistency: returns of the fund (or the market for that matter) are inconsistent, female behavior is the synonym of inconsistency, employee performance is inconsistent and don’t even get me started on politics!

Well, consistency might be an easy sell, but when it becomes an end to the means we get very consistent returns... of Mr Madoff.

In my view, inconsistency is not a reason to push a “panic” button, but rather to look into the matter and question the reasons – for both consistency and stability. Uninterrupted calm could be very convenient (think of a child that never cries!), but it is a good reason to do a pulse check (that silent kid might just be mute!)

In short – if it ain’t broken – don’t fix it, but do kick the tires.

PS. I guess, now you know what to expect from the musings – if they are inconsistent – it is by design.


  1. Your post might be relevant for a temporary or accidental inconsistency, when something suddenly went unexpected way. Consistent inconsistency, if you will, means high risks in finance theory or incoherent/illogical thoughts/actions. While you still may benefit from taking high risks in finance, how may you benefit from consistently incoherent thoughts?

  2. I am not sure I completely follow your logic. What I am syaing is that inconsitency is a part of life (in a very consistent way :) and therefore is not good or bad, it just "is".
    Incoherent thoughts are diffrent from inconsistency. In fact being blind to inconsistency would qualify as incoherent thought, in my view. And there is not benefit to such thoughts - as evidenced for example from Madoff's vicitms thought process...

  3. "Consistency is the last refuge of the unimaginative." O.Wilde