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Spud insists markets work better than government planning

Not that he quite realises he’s saying this but still:

From this, he concluded:

Public expectations of inflation have a better explanatory power than the Bank’s own forecasts in dictating UK inflation movements. This is clearly a problem for the Bank’s policymakers, whose forecasts are (supposed to be) more sophisticated than those formed by the public.

To put it another way, walk about and talk to people to find out what is going on. That, when it comes to economic forecasting, is much more important than anything that the Bank of England does by sitting in it ivory tower with all its financial models.

The reality is that people make up the economy, and not finance.

Will the BoE listen? I doubt it.

That is the insistence that the people, in aggregate, know more than the bureaucrats, politicians and planners. Which is true of course.

It also entirely buggers everything else Spud ever says about the economy.

8 thoughts on “Spud insists markets work better than government planning”

  1. To put it another way, walk about and talk to people to find out what is going on.

    He means “I walk about and talk at people to tell them what should be going on”.

  2. Yes. One cannot help noticing the verb “talk to” rather than “talk with”. Although “listen to” is usually better if one seeks information. But one suspects he is accurately depicting reality.

  3. ‘talk with’ is American, and is functionally identical to the proper English ‘talk to’ – it isn’t the same as ‘talk at’.

  4. “Talk with” is actually English. “Talk to” is a fairly recent corruption of the language. Certainly within my life-time. I couldn’t have got away with it as a kid. A lot of “American” English is simply English that hasn’t gone through the changes the English some English speakers have forced on it.
    Not saying there can ever be anything as “correct English”. In reply to dearieme’s constant corrections. Languages are living things. Correct is wot we speek ‘n rite, innit?

  5. One possible interpretation is that after looking at the available evidence he has formed a more realistic view of how things work.

    I did say “possible”. Time will tell ….. probably quite quickly.

  6. No way Andy. The great potato forms his view by seeing either what will help him get a grant, what goes down well with his audience or what side of bed he woke up. Evidence is a tool of fascist oppression. Its coincidence if he stumbles on reality occasionally

  7. “To put it another way, walk about and talk to people to find out what is going on.”

    Or, to put it more accurately, “go online and canvass the opinions of the subset of people one has not yet blocked.”

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