How banking is like encryption
At a recent standards meeting that I attended we digressed into talking about how few people really understand encryption and how many of the people who don't quite understand it don't seem to see anything wrong with stating all sorts of things about it on the Internet that are totally false.
(Not providing links to a few examples of this took the sort of self-control that you need to not get a snack at night when you're on a very low-calorie diet.)
This was a meeting where lots of the people present were from big banks, so it wasn't too surprising that someone quickly saw a parallel between this and the level of understanding that people in general have about how banks actually work. One of the bankers even pointed us to this link to give me an idea of the questions that he often gets asked.
I hadn't thought of this parallel before. I've dealt with the widespread lack of understanding of encryption for many years, but I've never really dealt with the widespread lack of understanding about how banks work. And from what I heard at this meeting, I've been fairly lucky in this respect.
To be fair, most people really shouldn't care about encryption and should just leave the arcane details to people who specialize in it. Instead, they should focus on just doing their jobs well, almost all of which don't require understanding much about encryption. So the fact that most people really don't know much about it isn't really a bad thing.
Making all sorts of false claims about it on the Internet is a different story, of course.
But the recent financial crisis has, the bankers at this meeting claimed, led to all sorts of false claims on the Internet about how banking works and how regulations should be either made or changed to make sure that it works the way that the sell-appointed pundits think that it really ought to work. They suggested that if some of the alternate models of banking are actually practical then the people pushing them shouldn't find it hard to get funding to implement them.
At this point, the room that we were meeting in would have been a very bad place to be if you were one of these self-appointed pundits.
I took the economics class in college that was called roughly "Money and Banking," and sort of assume that lots of people have a similar level of understanding of the topic. The bankers claimed that I was assuming way too much. And just like I get frustrated by the inaccurate claims made about encryption, the bankers apparently get a comparable frustration from the inaccurate claims made about how banks operate – a parallel that I hadn't appreciated until this meeting.