Hi George,

Thank you for asking. One of the two answers to the question I got was not so good, but at least it was an attempt. This candidate to succeed me as co-portfolio manager of the Davis Appreciation and Income Fund said he had played guitar when he was in high school. To me that is confusing form with substance. That is, playing instruments (like drawing, painting, and other arts) is considered by most to be a creative activity (form), ergo if you play guitar you must be creative. Yet, the substance of the question is: Do people understand their own minds and that the creative function is active for all people? Further, with this awareness do people actively try and tap their creativity?

So the winning answer (Hello MS!) was something along the lines of: "Well I'm not exactly sure what you mean by your question because creativity is always operating and a capacity within the mind. But I think I know what you are after. I came to Santa Fe [where I worked] yesterday and wanted to check out the city, and in particular, the skiing available here. I looked at the newspaper to see that the night before it was freezing on top of the mountain, but had been very warm earlier in the day. So I knew that the mountain would be icy. When I went to go rent my skis and gear I adjusted for the conditions, including how I waxed my skis. I also knew it was early in the morning and that the light would be a challenge on a course I did not know much about. I also had to make it down the mountain safely in order to make it here for my interview this afternoon. I like to ski aggressively, but had to adjust for all of these variables. I then decided how to tackle the mountain."

This is a perfect example of how creativity is used to solve a real world problem and the constraints handed to us. This candidate (Hello MS!) absolutely understood how his mind worked and how creativity helped him to solve problems. This task, how to ski that morning, is a near perfect match for the portfolio management problem. That is, you are given constraints, you have goals for fun (returns) and safety (risks), data about conditions, and then you make a decision under uncertainty with all of these working in conjunction. This is evidence of genius at work.

With smiles,

Jason