Knowing what we know about behavioral finance and risk, and the current state of the markets, how do we keep people invested in finance education and less fearful of the market but more excited about how they could learn and possibly get engaged to make it better? While I'm trying to do the scores. I think finance is an exciting field, it really is. It's not about getting rich. It's about making civilization work better. I think that it's good to have a society in which people feel part of the action. Where they're not just, a passive bystander, but they're someone who knows where some insights and where the opportunities are. Lots of people have insights that are specific to their field or their particular interests, and they understand it well enough to be motivated to take risk. See that's a fundamental thing. You can't just have someone tell you--a scientist come in and tells you--this is a good, a new idea, but you don't know. I won't be motivated to take a risk on it, unless I feel that I have some ownership of this idea, that it's part of me to understand this kind of thinking. I think actually there's been a lot of progress made in the last 30 years. If you look at both Russia and China today, for example. People in those countries are way more entrepreneurial and financially oriented than they were. I mean, it's just a total transformation in those countries and it has brought a lot of good. It's not just in those two, I just mentioned those as prominent examples. It's happening all over the world, in much of the world, that people are more business oriented and feel part of the system and are increasingly priding themselves on some understanding of finance. I think pretty much all the discussion now is about how finance, being a latest industry, but really finance is for everyone. So my question would be like for the future of finance. I think you mentioned a couple of times in class about the democratization of finance. And there are new technologies in the world with respect to, for example, investment technology that are commission-free. And they allow you to invest with very small amount of money so that it might be more accessible to common people. What do you think of those technologies and how do we really make them benefit the normal guys, not just Ivy League graduates or high net-worth individuals? This is an important theme, the democratization of finance. If you go back, let's say, 200 years. That's a long time ago. Walk into a bank and say I'd like to open a savings account. They would look you over and say "This man will usher you out the door." They didn't have any retail; it was only for wealthy people. Then there was, starting in the United Kingdom in the early 19th century, the savings bank movement, and this is an example now. They said that we need places for people to put their money and earn some interest. But those were created by philanthropists. These savings banks were non-profit. They were mutual or some form. So they were not profit-making enterprises. Those savings banks were well-designed and they lasted through the Great Depression. In the United States, not a single savings bank failed. That's because they had conservative investment philosophies and they were chartered to serve in the interest of the small savers. So this movement that you've described towards the democratization of finance is not new, it's been around. And we can keep thinking about more ways to make it work better for low-income people. That is really the ultimate objective. I have a question on financial literacy. Especially after the sub-prime crisis, it seems that, not only there is a huge informational asymmetry between the Wall Street players and the demands street. There's also a huge financial literacy or intellectual asymmetry that has been building on over the last few decades. Could you share some of your thoughts on how to address the issue of financial literacy? And to make sure that every member of the community can benefit in the long run. I think it's a little bit analogous to medical. Financial literacy and medical literacy are similar. You need a doctor, you cannot diagnose your illness yourself. On the other hand, knowing something about health matters. You have to know when to rush someone to the emergency room, and what are helpful eating patterns and things like that. I think that we need both of them. I think more attention has been paid to the financial literacy than to the financial advice. This is something that strikes me as a little bit odd. What you should really have is a trusted... You need a general practitioner, a doctor, that you talk to and you say "You know I have this ache here. What is it? I don't know. Should I worry?" You need to talk to someone like that. I think it's the same thing with financial advice. It blurs into psychological advice. "My husband, I think he gambles. And he also plays the stock market. He just lost a lot of our money. What should I do?" Could you kind of think about what could you do in terms of designing savings plans that use those same kind of behavior mechanisms where you've got that group support or something to... Nudge's. ...Nudge's, yes. What are your thoughts on going past Nudge's and into, for example, mandatory W-2 withholding into a pension account or something? This goes back to the theme that, when you refer to Nudge, I think that term was popularized by Richard Thaler and Cass Sunstein in their book Nudge. And it was a new philosophy which they called libertarian paternalism toward government intervention in people's lives. It's libertarian in the sense that people are free to choose what they do. No one tells them, forces them, to do anything. But it's paternalistic in that it sets parameters so that if you do nothing or you're not responsive you'll probably be in a reasonable situation. For example, if you don't sign up for a retirement plan or health insurance, you will be default option than do participating, unless you sign a letter saying "I don't want to." That seems obvious. In the past, you would have thought... Of course some people don't get around to doing things. We all know that from our own experience and we know that some people are not too smart. We still love them, you know there's all different degrees of intelligence so we have to make it work for everybody. That should seem obvious but it wasn't obvious. You know it seems that history is filled with examples of people not seeing the obvious. You talk about women. They used to think that women couldn't drive cars. How could you possibly think that... I don't know. I think they really didn't. If you never let them try, you won't find out.
