Fmr Quant Head Morgan Stanley: AI Can Give You the Answer But Not the Understanding | Joseph Mezrich

Joseph Mezrich, founder of Metafoura, former Managing Director and Head of Quantitative Equity Research at Nomura, former Managing Director and Head of US Quantitative and Derivatives Research at UBS, former Head of Quantitative Strategies at Morgan Stanley, former Deputy Head of Equity Portfolio Analytics at Salomon Brothers, and holder of a PhD in Mathematical Psychology and degrees from Michigan and MIT, joins Personable to reveal why AI can give you the answer but never the understanding, what four decades on Wall Street taught him about uncertainty, and why the models always break eventually and what you do when they do. In this episode, Joe opens up about publishing one of the earliest applications of machine learning in finance in 1994 when nobody else was even thinking about it, what the culture of Salomon Brothers was really like from the inside, and why humility is still the most important tool any quantitative researcher can have. This is an essential listen for anyone interested in quantitative finance, machine learning, AI, Wall Street culture, building edge in markets, and what it really takes to spend four decades at the frontier of financial research. He discusses: ◽️ Why AI can give you the answer but cannot give you the understanding and why that gap will define the next decade of finance ◽️ How he published one of the first machine learning papers in finance in 1994 and what he sees coming now ◽️ Why the models always break eventually and what you need to have in place for when they do ◽️ What the culture of Salomon Brothers was really like and why nothing on Wall Street has been quite like it since ◽️ Why uncertainty is the central feature of life and how quantitative thinking teaches you to navigate it 00:00 Introduction and Joseph Mezrich background 02:30 Why he left science for Wall Street and what he found when he got there 07:45 The culture of Salomon Brothers and what made it unlike anywhere else on Wall Street 14:20 How quant finance has evolved and where the crowd is not going right now 20:45 Why AI can give you the answer but not the understanding and what that means for finance 27:10 How to build models that survive black swan events and what the 2007 quant crisis taught him 34:50 How quantitative thinking changes the way you see uncertainty in every area of life 41:30 Government regulation AI safety and why the question nobody is answering is the most important one 47:55 Metafoura what he is building and why he started it after four decades on Wall Street 54:10 The wow factor legacy and one thing every listener should take away Joseph Mezrich: ◽️ LinkedIn: https://www.linkedin.com/in/joseph-mezrich-5248b76/ Harvey Bracken-Smith: ◽️ LinkedIn: https://linkedin.com/in/harveybracken-smith ◽️ Instagram: https://instagram.com/harveybsmith ◽️ X (Twitter): https://x.com/harveybsmith_ ◽️ Newsletter: https://personable.substack.com/ ◽️ Website: https://www.personable.media/ Personable Podcast: ◽️ Instagram: https://instagram.com/personable.podcast ◽️ LinkedIn: https://linkedin.com/company/personablepodcast ◽️ TikTok: https://tiktok.com/@personableclips ◽️ Spotify: https://open.spotify.com/show/7JOTYDER6m2FDrlhop4api ◽️ Apple Podcasts: https://podcasts.apple.com/us/podcast/personable/id1671640111 Additional: ◽️ Fundraising: https://www.loulouracefoundation.org/donatePersonable is a podcast dedicated to helping listeners become the best they can be by learning from the world's best in their respective fields. This mission is inspired by my mother, Louise, who encouraged me to become the best version of myself before she passed away from cancer in 2023. This content is for informational and entertainment purposes only and is not financial advice. Always consult a qualified financial advisor before making investment decisions. Investing involves risks, and past performance is not indicative of future results.