Gurus Talk About The Recent Stock Market Turmoil, and What to Expect

Fortune has blurbs from Wall Street gurus about the recent market gyrations. I love what Warren Buffett says about it

Many institutions that publicly report precise market values for their holdings or CDOs and CMOs are in truth reporting fiction. They are marking to model rather than marking to market. The recent meltdown in much of the debt market, moreover, has transformed this process into marking to myth.

Marking to model. The main problem I see with models is that they are usually linear approximations of nonlinear systems. That means they work well most of the time, but somehow, people translate most into a blind faith in the model.