When I read about this dramatic situation in Iris Mack's Blog, it immediately came in my mind, that it is often the details that we suppress and that so many things need to interplay correctly to make our convenient life also safe.
I let Iris speak: So even though this blog article is not about quantitative finance, I think it’s more important than all my other blogs. Grab life folks. Don’t take life for granted ..... (you feel her shock)
Being a save bird in a plane needs frogs that know exactly and into the "micro-level" how mechanisms, dynamics, processes and controls work and how to detect errors, anomalies and manage risk, before they lead to a crash ...
This is not so different from financial systems. Often quantitative details matter to avoiding unimaginable deal anomalies and keep models and valuation techniques reliable and robust. One critical point is Calibration (from E. Derman's Blog).
This is were we at UnRisk are good at. Really good, I would even say.
