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Misinterpreting Iran—and the World

“Learn to think imperially.”

—Joseph Chamberlain

Imagine that, for a few years, you had been investing the money you had saved for your daughter’s college education in one of those moderately conservative plans that provide some increase in the value of the investment without exposing it to major risks.  But then your financial planner—let’s call him Ken P.—came up with a really great idea.

He had heard through the grapevine on Wall Street that a grand company in Texas called Enron was, for all practical purposes, a cash cow.  He recommended taking out the money invested in that dead-end Fidelity fund and putting it all in Enron stocks.  And since you trusted the guy, you ended up following his advice—and are still trying to figure out how to finance your daughter’s junior year at Harvard.

The planner did call you to apologize.  “I’m so, so sorry—really!” he said.  “You have to understand that the conventional wisdom on the Street at the time was that Enron was very big.”  Indeed, major investment banks had forecast a significant rise in the value of Enron, whose bosses were close friends of a powerful political family.  Once more, Ken P. pleaded for your forgiveness and expressed his hope that you would...

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