Abstract
In this paper we give an academic assessment of the financial crisis (crises) from our point of view and discuss where quantitative risk management went wrong. We formulate four mathematical theorems/research areas which have relevance for financial crises in general where the underlying theme is model uncertainty. Related to these theorems, key issues that will be discussed are: financial alchemy on Wall street, risk aggregation and diversification, tail dependence for a portfolio of losses, and the significance of correlation bounds. (C) 2012 Elsevier Inc. All rights reserved.