What if ... it is different this time?

Asset allocation, risk, diversification and rebalancing. Pros/cons of hiring a financial advisor. Seeking advice on your portfolio?
blonde
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Re: What if ... it is different this time?

Post by blonde »

Yabutt...IT is different THIS time...

STUDY the SYSTEM.

Do not be surprised to learn that THIS-Time the Trust-Factor (T-Factor) is the lowest it has ever been. Dawg-eat-Dawg is vogue and getting better moving forward. In addition, Low-Trust has the Real-Power to strip the 'Spirit' and the rest is downhill in a hurry. Furthermore...study the Role of the Role-Models in the New-Global-Economy...

OTOH, there is an uptick...Adjust and Adapt...Don't Trust Anyone...Look After #1.

It is ALL about MONEY, Folks!!!...Big-Time.
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newguy
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Re: What if ... it is different this time?

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ghariton wrote:As a result, he who doesn't work is often seen as an object of pity (and sometimes scorn).
We decided one of us would stay home with the kid(s) and my gf said she wanted to work. I make (made) at least double what she makes. Most of my friends think I'm crazy but some of them say (when their wife's not around) they wish they could escape the rat race and live simply. Then they start talking about the latest Audi/Porsche whatever and I realize they don't get it.

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ghariton
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Re: What if ... it is different this time?

Post by ghariton »

tidal wrote:Fwiw, John Quiggin is speaking at the Rotman School of Management early next month... John Quiggin on The Role Played by Discredited Economic Ideas in the Meltdown, Nov 10 at Rotman‏.
While looking for something else, I chanced on this 27-page review by Stephen Williamson of John Quiggin's book, Zombie Economics. The last two paragraphs:
Unfortunately, Quiggin’s urge to construct a simple narrative, and his political goals, get in the way of sound economics. Quiggin would have us believe that financial economists, macroeconomists, and various other economists enamored with the theoretical beauty of well-functioning markets, have constructed tools which, if we use them, will lead us astray. In particular, the poor will suffer, and society will be worse off as a result.

Nothing could be further from the truth. The tools of modern finance and macroeconomics are not the instruments of conservative elements in society, serving only to bludgeon the working class. These in fact are the tools of science, and as such they can be used effectively by liberals and conservatives alike to make the world a better place. Misrepresenting the tools of science as the products of some vast conspiracy is as anti-intellectual an activity as the promotion of “intelligent design” as science, or the dismissal of informed scientific views on climate change.
I personally think that Williamson is overly kind.

For example, Williamson passes lightly over Quiggin's last chapter, on privatization. Perhaps, as a macroeconomist, he does not feel qualified to comment. But I have been involved in a number of privatizations, and what Quiggin says rings false to me. Certainly, the support he brings to bear is very, very weak. (Examples available on demand.)

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tidal
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Re: What if ... it is different this time?

Post by tidal »

ghariton wrote: (Examples available on demand.)
ok, let's start here:
The tools of modern finance and macroeconomics are not the instruments of conservative elements in society, serving only to bludgeon the working class. These in fact are the tools of science....
the bit about the tools of modern macro and finance being "the tools of science", especially anything he mentions regarding conservation laws. Or do they just use the bits that suit them. TIA.

"On demand"! 8)

Note, by the way, I am ignoring the middle part of his inflammatory quote. I just want the examples I demand. E.g. "The tools of modern finance and macroeconomics are... in fact... the tools of science."
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tidal
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Re: What if ... it is different this time?

Post by tidal »

A Roman in the year 12 invests the equivalent of $1 today at a rate of 2.0℅ real.

Today her estate is worth 3 million times as much as Bill Gates. Easy peasy, simples.

If everybody else completely blew it, but now in her will she leaves all 7 billion of us an equal share, we are all worth almost $250 million today!

Is this (2%) a good "going forward" discount rate to use for the millenium-scale environmental impacts of what we are potentially doing now?

Please show your work.
Last edited by tidal on 27 Feb 2012 05:27, edited 2 times in total.
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tidal
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Re: What if ... it is different this time?

Post by tidal »

tidal wrote:
ghariton wrote: (Examples available on demand.)
ok, let's start here:
The tools of modern finance and macroeconomics are not the instruments of conservative elements in society, serving only to bludgeon the working class. These in fact are the tools of science....
the bit about the tools of modern macro and finance being "the tools of science", especially anything he mentions regarding conservation laws. Or do they just use the bits that suit them. TIA.

"On demand"! 8)

Note, by the way, I am ignoring the middle part of his inflammatory quote. I just want the examples I demand. E.g. "The tools of modern finance and macroeconomics are... in fact... the tools of science."
Heh heh. Looking at the document myself now. Was I just lucky in my first "demand"? It seems to only come up in the "conclusions". Anyhow, I will await "examples". Maybe a finecon expert can assist.
The future is bright for jellyfish, caulerpa taxifolia, dinoflagellates and prokaryotes... rust never sleeps... the dude abides... the stupid, it burns. (http://bit.ly/LXZsXd)
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Re: What if ... it is different this time?

Post by Shakespeare »

Five years after crisis, no normal recovery: Reinhart and Rogoff | iPolitics
Looking ahead, does history suggest that the current U.S. recovery will be strong and robust, even if it has been so long coming? We hope this will be the case, but the jury is out. Precisely because there is often no bright line that marks a “recovery” stage after a deep financial crisis — the kind of halting uneven recovery the U.S. has experienced is the norm — considerable judgment is required in choosing turning-point dates (especially in real time).

An econometric definition of a turning point after a long financial crisis is an artificial construct, in contrast to our definition that looks at the years following a crisis.

Much work remains to be done to see if economies fully recover to trend potential GDP after a deep financial crisis, and just how many decades it takes (though even in the best case, it is certainly not a matter of a couple of years as would be true after a normal recession).
Sic transit gloria mundi. Tuesday is usually worse. - Robert A. Heinlein, Starman Jones
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Re: What if ... it is different this time?

Post by kumquat »

ghariton wrote: While looking for something else, I chanced on this 27-page review by Stephen Williamson of John Quiggin's book, Zombie Economics. The last two paragraphs:
Unfortunately, Quiggin’s urge to construct a simple narrative, and his political goals, get in the way of sound economics. Quiggin would have us believe that financial economists, macroeconomists, and various other economists enamored with the theoretical beauty of well-functioning markets, have constructed tools which, if we use them, will lead us astray. In particular, the poor will suffer, and society will be worse off as a result.

Nothing could be further from the truth. The tools of modern finance and macroeconomics are not the instruments of conservative elements in society, serving only to bludgeon the working class. These in fact are the tools of science, and as such they can be used effectively by liberals and conservatives alike to make the world a better place. Misrepresenting the tools of science as the products of some vast conspiracy is as anti-intellectual an activity as the promotion of “intelligent design” as science, or the dismissal of informed scientific views on climate change.
George
I took the liberty of changing the bold and underline. Does anyone, conservative, liberal, libertarian or other actually believe that economics is a "science" on par with chemistry, physics, bioligy or math?
I don't intend to offend anyone, that part is just a bonus.

Science flies men to the moon. Religion flies men into buildings.
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ghariton
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Re: What if ... it is different this time?

Post by ghariton »

kumquat wrote:Does anyone, conservative, liberal, libertarian or other actually believe that economics is a "science" on par with chemistry, physics, bioligy or math?
Let me break that up into two questions.

(1) Is economics a science?

Yes. Most of economics follows the scientific method. Gather data, formulate hypotheses, make predictions, and gather data to validate -- or not -- the predictions. Others try to replicate (or not) the results. The body of tools used to test the hypotheses is called econometrics, and it is quite extensive.

One may certainly criticize the tools and the theories as simplistic or inadequate, but that is beside the point. This is the scientific method at work.

(2) Is economics a science on a par with chemistry, physics, biology, or math?

As a preliminary point, I would argue that mathematics is not a science, but rather a branch of philosophy. While there is now a subject referred to as "empirical mathematics", its role is extremely small. The overwhelming tool is deduction from assumptions and prior deductions. Formulation of hypotheses, and use of empirical observation to test those hypotheses, is virtually non-existent.

As to chemistry, physics, et al, economics is not a science like those. There are two major differentiators.

(a) The subject matter of economics is much more complex than that of physics or chemistry, and so the theories are necessarily at a higher level of abstraction. Abstraction helps us understand, but detracts from forecasting ability. Thus, the ability of economics to forecast is generally markedly inferior to that of chemistry and physics. But it is not zero.

(b) Economics is interactive in that its subject matter is human behavior. Humans react consciously to economic stimuli in ways that atoms and molecules do not react in chemical or physical experiments. This makes controlled experiments in economics much more difficult, although far from impossible.

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NormR
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Re: What if ... it is different this time?

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ghariton wrote:(a) The subject matter of economics is much more complex than that of physics or chemistry, and so the theories are necessarily at a higher level of abstraction.
Oh, I think complexity in economics is strictly smaller than that of physics. At least for those physicists who are keen on finding a theory of everything. :wink:
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Re: What if ... it is different this time?

Post by tidal »

Anything to say about conservation laws?

Also, substitute "advertising" for "economics" in your prior post and re-read. It reads what it reads.
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Re: What if ... it is different this time?

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NormR wrote:Oh, I think complexity in economics is strictly smaller than that of physics. At least for those physicists who are keen on finding a theory of everything. :wink:
You wouldn't be stringing me along, would you?

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Re: What if ... it is different this time?

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tidal wrote:Anything to say about conservation laws?
Yup. Economics has them too, only they're called "budget constraints".

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Re: What if ... it is different this time?

Post by George$ »

ghariton wrote: ....
(a) The subject matter of economics is much more complex than that of physics or chemistry, and so the theories are necessarily at a higher level of abstraction. Abstraction helps us understand, but detracts from forecasting ability. Thus, the ability of economics to forecast is generally markedly inferior to that of chemistry and physics. But it is not zero.
I may be repeating myself at FWF - but I recall hearing the Richard Feynman (Nobel laureate in physics) once quipped someting like: - "Can you imagine how complex and more difficult physics would be if electrons had feelings." :?
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Re: What if ... it is different this time?

Post by Bylo Selhi »

ghariton wrote:You wouldn't be stringing me along, would you?
Caution: That sucking sound you can't hear indicates your proximity to his event horizon ;)
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Re: What if ... it is different this time?

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tidal wrote:Anything to say about conservation laws?
I don't know why you keep going on about that like it's a definition of science but balancing accounts is all conservation laws and it happens all the time. That's pretty much the whole problem we have right now, the private sector can't save unless the public sector un-saves. There is the current account that everyone is trying to change at the same time but again the conservation law says that all money flowing into or out of earth must equal 0 (barring aliens).

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Re: What if ... it is different this time?

Post by NormR »

ghariton wrote:
NormR wrote:Oh, I think complexity in economics is strictly smaller than that of physics. At least for those physicists who are keen on finding a theory of everything. :wink:
You wouldn't be stringing me along, would you?
Yes of course. But some rather arrogant physics types would claim that economics is just a 'predictable' outcome of their lovely equations. Where's a Venn diagram when I need one :)

Mind you, I might warm up to the topic a bit. How does one determine if something is more complex? Hum, perhaps a definition of complexity is in order first. (I can feel my brain starting to hurt already.)

As an aside, you might like Critical Mass by Philip Ball which I found to be quite interesting.
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Re: What if ... it is different this time?

Post by NormR »

George$ wrote:I may be repeating myself at FWF - but I recall hearing the Richard Feynman (Nobel laureate in physics) once quipped something like: - "Can you imagine how complex and more difficult physics would be if electrons had feelings." :?
But collections of them - with a few protons and neutrons - do. An odd emergent property for sure. ;)
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Re: What if ... it is different this time?

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tidal wrote:Anything to say about conservation laws?
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Re: What if ... it is different this time?

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I don't know if you know but that fed chart is literally off the chart. It only goes up to 88 mm but the latest value is actually 88,400 k. They had to fix a bug or something.

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Re: What if ... it is different this time?

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Here's a really scary presentation for those who enjoy doom and gloom. I'm off to buy more ammo now.

http://www.businessinsider.com/raoul-pa ... ame-2012-6

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