Almost, but not quite

Interesting piece on Robert Shiller and

a field beset by numbingly bad forecasting. Among the misfires: the unprojected 2008-’09 financial crash, and the fatefully under-appreciated ferment of people “left behind” by globalization, in part responsible for Brexit and the election of Donald Trump. Economics’ miserable record goes back to the beginning of modern forecasting: Of 469 recessions around the world during the last three decades, the International Monetary Fund foresaw just four by spring of the prior year, Bloomberg reported. Private sector economists did no better: From 1992 through 2014, they projected just five of 153 recessions. In an op-ed at the New York Times in September, Shiller argued that the problem is fundamental. The leading economic indicators on which economists rely, such as interest rates and GDP growth, have been better at telling us where we have been than where we are going.

Well, we saw a lot of the signs back in 2007: that Bear Stearns conference call, the deadly trio of sub-prime lending, credit default swaps, and CMO’s, etc. We were hardly alone. Christine Lagarde knew at once how idiotic the Hank Paulson et al’s decision was to let Lehman fail. He had been CEO of Goldman, for goodness sakes, so the above piece is correct that’s a lot of idiotic stuff out there.

One Response to “Almost, but not quite”

  1. feeblemind Says:

    I am getting behind . . .

    Later.

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