Microsoft Excel – spawn of Satan and “dangerous software”?


When the London Whale trade at JP Morgan blew up, costing the company billions, one of the contributing factors was a Excel spreadsheet that had the wrong formula on a crucial calculation.

The various financial market regulators are rather waking up to how these decisions are being made in the markets. And thus the warning at the top: guys, do you think you could pay a little more attention to the tools you are using to move these billions and tens of billions around? For as we can see getting it wrong can be painfully expensive.

My wife is a CPA and is the Goddess of Excel. She says:

Excel is a neutral tool that is only as good as its user. It is electronic “paper” with a built-in calculator.

The dangerous elements are (1) delusionally confident traders, (2) lack of oversight, (3) a system that rewards risk taking above all other considerations.