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Sunday, December 4, 2011

Why Economists Are Useless In The Real World

This is a new Nobel Prize Winner.  Check out his black board.  All nonsense mathematics.  Here is a snip from the article.

"And yet, in this time of economic angst, with the fate of the euro and the course of the global economy uncertain, these two Americans have reached the pinnacle of a profession that, to many, seems to have failed miserably. The financial crisis of 2008-09, the Great Recession, the debt mess in Europe — few economists saw all of it coming. For all its elegance, modern macroeconomics seemed to provide little help when the world needed it most.
Today, solutions to our economic troubles, from onerous government debt to high unemployment, remain elusive. And the field of economics, like Washington politics, seems as polarized as ever."

And here is some more.  However, as these guys say, you are too stupid to understand their work, which, course, is the hiding place of frauds.

"They won their Nobel for “their empirical research on cause and effect in the macroeconomy,” in the academy’s words. What that means, in part, is that they have done some serious math. Today, ideas they largely formed in the 1970s and ’80s help shape the thinking inside the Fed and on Wall Street.
Their work goes beyond old labels like Keynesianism and the monetarism of Milton Friedman. They have shown that fiscal and monetary policy are inextricably linked, and their research reflects the broad shift in economics from words to numbers — toward a level of empirical analysis that few outside the profession can readily grasp. But it contains a kernel of skepticism appropriate for these troubled times. In a world of uncertainty and constraint, cause and effect may not be what they seem. As a result, we must test and retest our assumptions — and try to prepare for the unexpected.
“The most impressive thing about them as scholars,” says David Easley, an economist at Cornell University, “is that in recent years they have questioned the assumptions of the models they helped to create, and they have been at the vanguard of the efforts to go beyond them.”
Mr. Sargent says his most important work is spoken “in the beautiful language of math.” He knows it’s not widely understood.
“The kind of work we do, that real economists do, will never catch on with the public,” he says."

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