Interesting really

I am also aware that there are those who think I have forecast eleven of the last three downturns. I accept that because I believe that the current structures of our economy, and the beliefs that underpin it, are systemically flawed I tend to read coming crises into situations more readily than I would if I believed that prevailing mainstream economics did actually have something useful to say on how to manage our situation and if I believed the structures we have in place might work.

That’s an interesting admission of prejudice.

I forecast wrongly because I don’t believe conventional economics. Conventional economics seems to be right about my predictions but I’ll believe me anyway.

One clue as to the problem might be:

markets exist in the moment

Most odd. All that conventional economics insists that market are forward looking. But then The Tuberoso has always had problems with the concept of discounting and net present value, hasn’t he?

So let me offer my advice. I’m now older than Jack was when I first met him. My suggestion is read, write, think, and act on what you learn. That is how we get ready for the next time. And that is how next time does not go to waste.

So he’s a Friedmanite again. When a crisis occurs the solutions are found in those ideas already lying around?

13 comments on “Interesting really

  1. I am also aware that there are those who think I have forecast eleven of the last three downturns.

    Amusing. He’s clearly a regular….

  2. Well yes, obviously. But one should point out that there’s a great many conventional economists failed to predict the last 3 downturns. In fact I doubt if renowned & learned economic experts have much better records of economic prediction than a tossed coin or the examination of animal entrails.
    Economics is a discipline that can explain why what happened, happened. It can’t tell you what will happen.
    A visualisation to illustrate why:
    Imagine a cone, standing vertically tip up. The tip is the present & the body of the cone contains all the factors that led to the present. Take a horizontal slice through the cone & the disk revealed represents all of the potential futures that could have arisen from that point in the past. As you move towards the present, the discs get smaller as potential futures can be discarded as rendered impossible by events. Eventually you’re left with the one that happened.
    Now balance an identical but inverted cone on the tip of the first. That’s the future. A little way up from where the tips join, it’s possible to predict the future with a degree of accuracy because the disc of potential futures is limited. But the further up the cone you go the disc of potential futures grows larger as more & more events occur.
    Yes, extrapolating what happened last time is a useful guide to the future. But that presumes the disc of events is the same. Your starting point will never be identical & the further you go into the future the more unpredicted events will influence outcomes.

  3. BiS

    The nice thing about that analogy is that predicting the future is akin to predicting which way the inverted cone (on its tip) will fall.

  4. Of course you have to remember that the potato suffers from delusions “I was talking to a friend about an amazing man called Jack Ray. Jack was my mentor as a teenager. I won’t bore you with the whole story. But Jack saw in me a boy who wanted to change the world, even then” – and that’s why he became an accountant – to change the world.(like you do) I’ll be contacting Marvel to punt this idea for a new superhero – “potatoman” . Fuck me I know it’s hot but not enough to become delirious. The mans an imbecile

  5. @bloke in spain, July 8, 2018 at 12:57 pm

    one should point out that there’s a great many conventional economists failed to predict the last 3 downturns.

    2007/8 predicted bank [mortgage] crash predicted by Liam Halligan long before and iirc by Warren Buffet.
    .

    @Tim W,

    Did you write about impending crash?

  6. I think that there’s lots of economists who predict crashes, but don’t get reported.

    Timing is difficult, so they tend not to be Spud like in their certainty.

    The media don’t run with dismal predictions based on inconvenient facts and difficult to understand theories.

    Politicians *really* don’t like bad news.

    If you’re going to make money off a crash, then you want to keep your opinions to yourself. Lots of people made out like bandits from the mortgage crash.

  7. @Pcar
    And your’s truly. 2007 was when I shut up shop & pissed off à nouveaux pâturages.

  8. moqifen: I’ll be contacting Marvel to punt this idea for a new superhero – “potatoman”

    Forgive me but Captain Potato is already registered with the Justice League of America

    BiS: And your’s truly. 2007 was when I shut up shop

    …and left the partitive article behind.

  9. @TMB – he hates the uk, he hates Trump and I’m pretty damned sure he hates The US. More like Justice league of the EU would be his preffered grouping – though the hypocisy is outstanding -Druncker has enabled massive tax avoidance when he was in charge of luxembourg but a few grants from the eu and he’s forgotten all about that. Captain potato who’s superpowers are hypocrisy and cant.

  10. @Chester Draws, July 8, 2018 at 7:30 pm

    Liam Halligan was writing for Sunday Telegraph every week in 2007/8, thus in msm. He explained why the USA & to a lesser extent UK, mortgage crisis was building and the ignored related derivatives time bomb. How/why crash: B Clinton, Sen Obama & BLM

    Back then DT & ST were intelligent, informative newspapers (except Cameron sycophant chap now at Gurnion).

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