Wednesday, April 22, 2009

Death By Success - A Threat To XBRL?

Talking to my friend and co-worker Yossi Newman, he brought up an interesting concern. Would the increasing use of XBRL cause a chorus of nay-sayers to form that could seriously threaten XBRL's path to world domination ubiquity?

Umm, no.

I think the number of applications of XBRL around the world has already put us past that possibility. Failure in one market could affect acceptance in that market, but that will only put that market behind others, which will eventually put pressure on them to catch up.

My larger concern along similar lines relates to asset bubbles. Our long run of good news ( no nuclear war, pandemic, global famine, etc.) has created a huge amount of investment funds chasing investments. This leads to asset bubbles. Any advantage will be pounced upon in the search for 'alpha'. XBRL is just such an advantage. The result could be that enormous pressure could be put on the vendors and supply chain of XBRL quite suddenly, too suddenly for them to adjust. A classic case of 'be careful what you wish for'.

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