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Old 01-24-2018, 09:21 AM
 
Location: Aurora Denveralis
2,970 posts, read 1,012,279 times
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Hilarious (to me) column by Paul Krugman, admitting what everyone already knew: economists, even the most respected big names, just make sh*t up for political and career reasons... and no one cares. Quite the opposite: they click on the Like button a hundred times and beg for more.
The universal tie-pin of econ pundits should be a stopped clock.
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Old 01-24-2018, 10:08 AM
 
Location: Shawnee-on-Delaware, PA
3,673 posts, read 3,251,579 times
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Well, Krugman admits that "other" economists make schitt up. His focus here is on people who thought inflation would come back and he crows that he was right about inflation not coming back.


I'd like to read an article by Krugman explaining why he thought the 2016 election would usher in an era of economic disaster, and why he got it so wrong.
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Old 01-24-2018, 10:14 AM
 
Location: Aurora Denveralis
2,970 posts, read 1,012,279 times
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He includes himself to a degree and I'm inclined to cut him a little slack because he's so often deadly honest about the realities. He also only has 6-800 words to work with.

That 99.999999% of "other economists" make it up is still on-point even if he's indirectly claiming a degree of infallibility.

There's an old, old Peanuts cartoon that ends with Lucy whispering, "I make it up." Should be an engraved plaque on every econ pundit and professor's desk.
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Old 01-24-2018, 10:16 AM
 
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Anybody who predicates an economic forecast or a critique of it on just one year of data is no better than the average person. He is one of the writers whose writing is heavily colored by his politics and for the business interests for which he advocates. The writers are all very predictable.
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Old 01-24-2018, 10:36 AM
 
Location: Aurora Denveralis
2,970 posts, read 1,012,279 times
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Quote:
Originally Posted by lchoro View Post
The writers are all very predictable.
Of course they are. They're economists, too! Krug's a Yale/MIT Ph.D., at least.
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Old 01-24-2018, 05:51 PM
 
24,885 posts, read 11,599,261 times
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Quote:
Originally Posted by jtab4994 View Post
Well, Krugman admits that "other" economists make schitt up. His focus here is on people who thought inflation would come back and he crows that he was right about inflation not coming back.


I'd like to read an article by Krugman explaining why he thought the 2016 election would usher in an era of economic disaster, and why he got it so wrong.
Maybe you should read what he said about it then. This is from 3 days after his initial prediction that everyone focuses on:

https://krugman.blogs.nytimes.com/20...the-long-haul/
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Old 01-24-2018, 06:20 PM
 
Location: Aurora Denveralis
2,970 posts, read 1,012,279 times
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Concentrate on the first word of my OP.

I'm not arguing Krugman's godhood here; I am applauding his comment about the emperor's clothes, of which some of his are cut from the same cloth.
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Old 01-25-2018, 10:03 AM
 
Location: WA
5,292 posts, read 20,697,476 times
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The real economy is made up of trillions of decisions made by billions of people responding to what they perceive the best thing to do for their interests. Meanwhile there are hundreds of governments and central banks trying to manipulate currencies, liquidity, and interest rates. And billions of variables with business decisions, commodity availability, and weather patterns.

No one has the insight, foresight, comprehensive knowledge, or tools to know what, where, and when regarding the economy. It is all guesses and words.
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Old 01-25-2018, 10:28 AM
 
Location: Aurora Denveralis
2,970 posts, read 1,012,279 times
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Quote:
Originally Posted by cdelena View Post
No one has the insight, foresight, comprehensive knowledge, or tools to know what, where, and when regarding the economy. It is all guesses and words.
That might be a little overstated; I think we can dimly perceive economic futures, but it's all too easy to use someone else's prefab conclusions and look for validation (yep, classic validation bias, often carried to mass delusion) than it is to step back and see the whole foggy picture a little differently.

I see no reason to bet heavily on a consensus view that has a track record worse than the average racetrack addict. And no reason why my contrarian view, based on many of the same hard data points as the establishment crowd, is any less accurate. At least mine includes, you know, people.
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Old 01-25-2018, 11:09 AM
 
6,815 posts, read 4,408,035 times
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Quote:
Originally Posted by cdelena View Post
The real economy is made up of trillions of decisions made by billions of people responding to what they perceive the best thing to do for their interests. Meanwhile there are hundreds of governments and central banks trying to manipulate currencies, liquidity, and interest rates. And billions of variables with business decisions, commodity availability, and weather patterns.

No one has the insight, foresight, comprehensive knowledge, or tools to know what, where, and when regarding the economy. It is all guesses and words.
There's a fundamental difference between descriptive knowledge and predictive knowledge. Descriptive knowledge tells us what happened, and why. Predictive knowledge tells us what's going to happen, and when. Economists are pretty good at discovering and promulgating descriptive knowledge. But predictive knowledge is generally impossible. Why? Because, as cdelena points out, there's too much going on. Even a minor oversight or approximation can rapidly result in unacceptable divergence between prediction and reality - even if, the predictive model is sound and cleverly built. This is also why there's so little disparity in investment-results, between people who have good understanding of markets and economics, and those who are quite ignorant.
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