Much-publicized problems with hedge funds and the disappointing risk models of large banks should make community bankers more secure in relying on their more personal approach to lending and investing.

The stories of how banks-which are equipped with the latest computerized trading and investing tools-were unprepared for the volatility also pointed out how expensive this failure was. And the difficulties of Long-Term Capital Management and other hedge funds that relied on historical data to plan their portfolios further emphasize that computer models are nothing to bet the ranch on.

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