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Old 01-16-2014, 10:20 AM
 
663 posts, read 774,908 times
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It seems like every kid off the block thinks they are pro at economics. Why is that with economics?

Note: This also spills into the area of investing as well. Every trader on the block thinks they are pro at trading.


I don't see people claiming to be pro at doctors or pro and basketball...


Various forums and people claiming they know economics:







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Old 01-16-2014, 11:28 AM
 
Location: TN/NC
34,831 posts, read 30,898,649 times
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Economics is one of those subjects a person can really self-educate themselves on pretty well. There are few barriers to studying it - there isn't a lot of expensive equipment to buy, it doesn't require a specific location, it doesn't require a license to pursue, and it can be done on your own or in groups. The literature on economic theory is either free or very cheap and also widely available. Anyone can go to Amazon and buy books from numerous economists with varied perspectives for under $100. More technical papers are often available free of charge from academic journals and universities.

One of the few functions I'd argue the government and Fed do really well is make all sorts of economic data accessible to the average person via the web. The BLS, FRED, and some other services have most data I'd want to view available in time-series on the website for free. Raw data is seldom cited on major news networks, but it is available in great quantities if you are so interested.

Most people can learn the economic theory on their own and should be able to get the math associated with intermediate macro and micro at the undergraduate level with a little practice. Some areas like game theory and economometrics are going to be difficult to learn on your own. Truly technical, math-heavy economics is where one needs the education, but for all but professional economists, this deep understanding isn't required, and many times isn't beneficial for the layman's understanding.
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Old 01-16-2014, 11:31 AM
 
2,991 posts, read 4,267,603 times
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Could be because professional economists know so little.

First law of economics: for every economist, there exists an equal and opposite economist.

Second law of economics: they're both wrong.
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Old 01-16-2014, 12:14 PM
 
663 posts, read 774,908 times
Reputation: 498
Quote:
Originally Posted by Emigrations View Post
Economics is one of those subjects a person can really self-educate themselves on pretty well. There are few barriers to studying it - there isn't a lot of expensive equipment to buy, it doesn't require a specific location, it doesn't require a license to pursue, and it can be done on your own or in groups. The literature on economic theory is either free or very cheap and also widely available. Anyone can go to Amazon and buy books from numerous economists with varied perspectives for under $100. More technical papers are often available free of charge from academic journals and universities.

One of the few functions I'd argue the government and Fed do really well is make all sorts of economic data accessible to the average person via the web. The BLS, FRED, and some other services have most data I'd want to view available in time-series on the website for free. Raw data is seldom cited on major news networks, but it is available in great quantities if you are so interested.

Most people can learn the economic theory on their own and should be able to get the math associated with intermediate macro and micro at the undergraduate level with a little practice. Some areas like game theory and economometrics are going to be difficult to learn on your own. Truly technical, math-heavy economics is where one needs the education, but for all but professional economists, this deep understanding isn't required, and many times isn't beneficial for the layman's understanding.
You can say that with programming, with math, with engineering, with biology, with health science, with law

Nearly anything could be self educated and accessibility cost is low.


However, it seems to me that in the economics field, everyone seems to have an opinion and that they are always right.
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Old 01-16-2014, 01:00 PM
 
Location: Cold Springs, NV
4,615 posts, read 12,218,668 times
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Their media source made them experts, so they just regurgitate their favorite pundit.
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Old 01-16-2014, 05:58 PM
 
Location: Striving for Avalon
1,431 posts, read 2,470,880 times
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Quote:
Originally Posted by MrWillys View Post
Their media source made them experts, so they just regurgitate their favorite pundit.
I am going to go with this one. I have seen more than a few crackpot theories circulating on this forum.

Even the relatively good advice on econ/investing such as "Put X into a balanced mutual fund and in 35 years it will grow to $750,000" will seldom include disclaimers such as "how much purchasing power will that 750k have in 2049?"

Last edited by Amelorn; 01-16-2014 at 07:22 PM..
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Old 01-16-2014, 06:59 PM
 
Location: East Coast of the United States
27,266 posts, read 28,339,813 times
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Quote:
Originally Posted by techcrium View Post
It seems like every kid off the block thinks they are pro at economics. Why is that with economics?

Note: This also spills into the area of investing as well. Every trader on the block thinks they are pro at trading.
You don't need to be a "pro" to be successful in investing.

In fact, most of the time you need to do nothing at all.
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Old 01-16-2014, 07:53 PM
 
Location: TN/NC
34,831 posts, read 30,898,649 times
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Quote:
Originally Posted by techcrium View Post
You can say that with programming, with math, with engineering, with biology, with health science, with law

Nearly anything could be self educated and accessibility cost is low.


However, it seems to me that in the economics field, everyone seems to have an opinion and that they are always right.
Things like health science usually require some practicum in a medical environment to really get it. You can't do that with self-study. Being a competent engineer requires more resources than the average individual can muster. Lawyers must pass the bar to practice. Anyone can prognosticate on economics.
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Old 01-17-2014, 07:09 AM
 
8,073 posts, read 9,994,592 times
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In the 'old' days the study of economics, and the art of investing, were confined to s small group of people who were very professional and worked in relative obscurity.

Not so much any longer. Today we have business news channels devoted to cheerleading economic and market developments like they were some sort of sporting event. "Guess the Jobs numbers on Friday and get a free Coffee Mug" sort of thing. When we sold off in 2008/09 it did not end well for many 'amateurs'. And should we enter another period of consolidation where the tide recedes dramatically, there will be another whole group of armchair traders and economists who will get carried out with the tide. Even in the supposedly 'professional ' ranks you get cycles where wet behind the ears investment managers don't know anything but 'buy the dips' and 'cheerlead for the economy'. They have little experience, and virtually no seasoning in the real cycles of the market. And they get buried when economic events twist and turn beyond their superficial understanding of how all things financial actually work.

As a long time "Wall Streeter" my greatest frustration is that the need to make a living gets in the way of being able to take the time (months/years) necessary to understand what is really going on. Outfits like CNBS make it all sound like any person who can flip the buttons on the interweb is an 'expert' on all tings economic and financial markets. The truth is that it would take a year of constant research and study just to understand things like QE...but you will find plenty of folks who will give you their absolute knowledge of exactly how it works, and all of the implications for markets far and wide.

The whole thing has become an embarrassing casino, which, in my mind , will not end well--but you can make a fortune pretending for a long time!

BTW, the viewership numbers of things like CNBS are horrible. Perhaps people have figured it out more than I give them credit for....but I somehow doubt it.
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Old 01-17-2014, 08:58 AM
 
2,991 posts, read 4,267,603 times
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Quote:
Originally Posted by Ted Bear View Post
When we sold off in 2008/09 it did not end well for many 'amateurs'.
Holy, moley! Good grief, Charlie Brown!

We need to ask some of the 'professionals' at AIG, Wachovia, Merrill Lynch, and Lehmann Brothers -- just to suggest a few -- how it ended for them . . .
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