Happy New Year: catchup time

Celebration and the resultant recovery has taken up much of my time recently, to the detriment of blog posting. Time, then, for a brief round-up of interesting things that have come my way recently.

• Being an actuary still one of the best jobs around.
• The EU will probably never have a rational system of government.
• Bond yields at the moment are closely correlated with the relative probabilities of who will win the General Election, and what their approach to deficit reduction will be. Today's auction of £4bn of short dated bonds went well and was oversubscribed by some way.
• Derivatives are supposed to make it safer to invest in an asset by parcelling out the risk. However, this paper from Princeton demonstrates that it is fairly easy to construct a seemingly simple derivative whose behaviour requires unattainable amounts of computation to model. In short, you can booby-trap a derivative.
• A solid analysis of operational risk management in the light of the economic experience of the last few years. It was commissioned by the main North American actuarial bodies, and is a solid and not overly technical read.
• Whatever your problem, the chances are it's been solved before. Take note, TSA.
• And of course, some 2010 predictions.