Recipe for Disaster: The Formula That Killed Wall Street. This is an interesting article, not actually about how the formula itself killed Wall Street but how the eagerness of traders to grab onto a magic bullet led them to tweak a formula for calculating correlation so that it fit their needs. Of course, one thing this article doesn't mention is that, had it not been this formula, it would have been something else. One thing that the financialization of capital has done is to make the international markets incredibly vulnerable to things like this. This fallout of capitalization is the kind of thing that only Marxists and very skeptical chaos-theory liberals like Nassim Nicholas Taleb actually propose in times of economic prosperity, but that people start taking seriously during an economic collapse. The basic principle is that when everyone starts doing the same thing - misusing a specific correlation formula, for example - this creates a bubble that will eventually burst. Anyway, check out the article. Worth reading.