Myron Scholes

(Myron Samuel Scholes)

Myron Scholes
Myron Scholes
  • Born: July 1, 1941
  • Nationality: Canadian, American
  • Profession: Economist

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Myron Samuel Scholes is a Canadian-American financial economist. Scholes is the Frank E. Buck Professor of Finance, Emeritus, at the Stanford Graduate School of Business, Nobel Laureate in Economic Sciences, and co-originator of the Black–Scholes options pricing model. Scholes is currently the chairman of the Board of Economic Advisers of Stamos Capital Partners. Previously he served as the chairman of Platinum Grove Asset Management and on the Dimensional Fund Advisors board of directors, American Century Mutual Fund board of directors and the Cutwater Advisory Board. He was a principal and limited partner at Long-Term Capital Management, L.P. and a managing director at Salomon Brothers. Other positions Scholes held include the Edward Eagle Brown Professor of Finance at the University of Chicago, senior research fellow at the Hoover Institution, director of the Center for Research in Security Prices, and professor of finance at MIT’s Sloan School of Management. Scholes earned his PhD at the University of Chicago.

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A bank needs models to measure risk. The problem, however, is that any one bank can measure its risk, but it also has to know what the risk taken by other banks in the system happens to be at any particular moment.
A futures contract is a derivative, but the futures exchange doesn't call them 'derivatives,' they call them 'futures.'
All models have faults - that doesn't mean you can't use them as tools for making decisions.
Building a road might create temporary jobs, but does it really create wealth if it doesn't also shorten commute times or otherwise make society better off? Society
Every side of a coin has another side.
From an early age I was very, very fascinated by uncertainty.
I think in our global economy, uncertainty is ever increasing. So to accommodate to that, we need to build a dynamic economy and dynamic rules that can adapt to changing circumstances.
I was involved with Wells Fargo Bank as a consultant in the late 1960s and early 1970s, when I suggested to them that they develop a product that has become known as index funds.
If someone says to you, 'Go to an old-folks' home,' that's kind of ridiculous, because a lot of old people are doing terrific things for society. Society
If we internationalize everything, we end up with rules that stifle freedom and innovation. Freedom & Liberty
I'm a theorist, not an institutionalist.
Innovation must lead infrastructure for a simple but compelling reason: Innovation produces new types of products and markets, and it is virtually impossible to know how to run those markets efficiently before they are created.
Keynesian modelling relies on marginal propensity to consume and marginal propensity to invest. The idea that if we give more money to the poor, they have a propensity to consume that's much higher than the wealthy, though I wish they would talk to my wife about that; she seems to have a propensity to consume. Money, Coins & Minting
Most of the time, your risk management works. With a systemic event such as the recent shocks following the collapse of Lehman Brothers, obviously the risk-management system of any one bank appears, after the fact, to be incomplete. We ended up where banks couldn't liquidate their risk, and the system tended to freeze up. Time
My career in academic research has not been involved with active management of securities. I've tried to understand risk-and-return relationships; also the pricing of derivative securities.
My first reaction on being awarded the Nobel Prize was, actually, I thought of Fischer Black, my colleague. He unfortunately had passed away. And there was no doubt in my mind that if he were still alive, he would have been a co-recipient of the Nobel Prize.
My view is that one should diversify broadly across different fund investments. However, it's tough for investors to try to pick the appropriate risk level that they should manage their funds at. Having a personal adviser would be helpful.
Sometimes the early bird gets the worm, but sometimes the early bird gets frozen to death. Death
Tax incentives might spur hiring in the short run, but how lasting are those gains if the jobs expire with the tax credits and they come at the expense of investing in the new technologies of the future? Future
The experience of the '90s, whether it's the '94 peso crisis or the '97 crisis in Asia, the '98 crisis, even the 2001 crisis, is that we recovered pretty readily. There wasn't great consequence.