Archive | Economic Theory

Why do we survey economists’ opinions when the majority are wrong?

When it comes to the question of when (and if) the Federal Reserve will raise interest rates, we’re not really sure why the media continues to report on “what economists think“.   It’s clear to anyone who is paying attention that economists are not good at making predictions, and that the consensus of economists has been consistently wrong after […]

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Rick Santelli vs. the Talking Heads

Today’s pro-Fed vs. anti-Fed showdown on CNBC was highly entertaining and highly infuriating all at the same time. Here’s the problem with the closing argument: Those that argue that ‘the market has risen ergo the Fed has succeeded’ not only misunderstand the role of the Federal Reserve (as Santelli pointed out), or to whom the benefits […]

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NotQuant’s response to Mish’s Response to NotQuant

Yesterday, we read Mike Shedlock’s response to our piece Is the Fed Going to Initiate A Controlled Collapse with interest. He called our piece “complete silliness” and then attempted to deconstruct our logic with this silliness: Mish wrote: Does the Fed know the difference between an asset bubble and my mom’s tuna casserole? Does the Fed know the […]

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What would mainstream economists have advised Bernie Madoff to do?

Just over two weeks ago, Bernie Madoff’s accountant finally plead guilty to fraud after six years of defending himself. He was sentenced to 30 years in prison at the age of 78. While he admits to falsifying records, to this day he claims he had no idea that Madoff was running a ponzi scheme. The prosecution has called […]

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Did Google’s Larry Page just solve a major economics problem? Umm. No.

Everyone’s wondering what we’re going to do about the coming unemployment crisis as technology and automation displace more and more workers.   It’s a serious problem and it’s one that’s approaching far faster than most people think. With current technological research, we are realistically looking at a frighteningly near-term future with driverless trucks, “lights out manufacturing”, […]

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