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Max Keiser And Sandeep Jaitly Explain Why Modern Economics Is "Rubbish"
One of Zero Hedge's recurring peeves with modern economics (at its basis, the flawed premise behind modern broken capital markets) is that modern economics, as taught by every Ivy League, and other, institution, and implemented by modern acolytes of Keynes and other spin off theories, is nothing but garbage: a sham voodoo science, which attempts to attribute an empirical basis to something which is inherently irrational. It is this irrationality that alternative, and thus non-mainstream, approaches to popular economics attempt to discredit, so far with zero success, as such a coup d'etat would mean an immediate end of the "status quo"TM which is for all intents and purposes the only thing that must be maintained in order for the wealthy to retain their wealth, and get far wealthier in the future (Paulson's 3 page blank check proposal to Congress was nothing but a band aid attempt to fix the cumlination of decades of Keynesian failure). The below attached interview between Max Keiser and Sandeep Jaitly provides a 3 minute, must watch glimpse into the basis of Austrian economics, although not through the lense of von Mises, but of Austrian founder Carl Menger, who founded the Austrian school on one axiom only: "value does not exist outside mankind's consciousness." As Jaitly goes on to say, "all other forms of economics, classical, neoclassical economics, ascribe value to something else other than the human mind." And the punchline, coming from a mathematician: "all of the equations in neoclassical economics are rubbish. The differential equations describe nothing. Economics is not about mathematics, it is about the human being."
h/t Mike Krieger
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The lifeboat is still boarding:
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TYler - did you use special screen capture software to make Max and Sandeep look like Zombies? Were you making a Zombie statement?
Was just going to say. Sandeep looked particularly grey. Needs some sun.
Basically physics seems to be about the consolidation of order/mass and the expansion of energy. So long as order can gain more energy than it loses, it grows. If it becomes unstable, it looses the energy rapidly, ie. explodes.
The reality is that the current world order has already expoded and we are just riding the wave front of a super nova.
You might say we are somewhere between the window and the sidewalk.
There is no happy medium, as that would just be a flatline on the universal heart monitor.
Biological processes overcame this necessary cycle through regeneration. Pushing the big reset button.
Basic physics is about the dissolution of energy, ala entropy. Only Libs believe in a free lunch.
Did you forget gravity?
Actually entropy only applies to a closed set. It loses energy, so it has to add energy in order to remain stable. Presumably the universe is currently considered a closed set, but large holes keep popping in that idea and they keep having to add ever bigger patches. Since they now propose multiverses and dark energy, it's hard to say it is actually a closed set.
Um.. . . . .
Economics is psychology. Isn't this blindingly obvious to everyone?
Just drinking a nice portugese rosè. (Helping their balance of payments, save the world and all that). Please excuse any typos.
Those two guys look like Frankenstein and Dracula
agreed, Sandeep looks like he's been on week long speed bender.
@ Tyler...I just got a handful of the Silver Keisers...and they are pretty sweet. What would the odds be of a ZH round getting produced? I'm not sure what the logistics would be on your end of minting them, but man would I love to get my hands on some. Could you imagine Tyler's face on a round with some sarcastic words of wisdom...it would be too sweet. Hopefully Chuck Palahniuk and Pitt would be down with it.
and, market it as money and put something like $10 TEN DOLLARS $10 right on there!
wait! i didn't say that! iyam not part of this conspiracy. let me go. no! me? oh, no! not guantanimo!
Lol...I see what you did there Slewie...but Von Nothaus notwithstanding, I think it could work. Between all the readers on here, the resources are available. Hell we could get William Banzai to do the design. What better way to donate to Zero Hedge? He could produce rounds and we could purchase them for X dollars above spot.
I'm down with x pennies above spot. Let's not get carried away.
hey, DiS! hahaha!
von nuthouse got sold up the river by his lawyers, imo. stupidity has its disadvantges. we all learn that one. the hard way.
i have already broached this subject, while noting that johnny silver bear put out a nice proof and may still be free.
i would like to present my ideas for the most un-collectible round in nooomismagic herstory: the slewie quarter (oz).
this fuker wld have ever defect known to humanity. clipped plachet, dbl die, off-center, struck thru, with a big, greasy tyler fingerprint over the reverse design. and scratched, cleaned, and rubbed b4 shipping, w/ random rim dings.
maybe make them out of 90% coin silver to add confusion, and so they will last while used in pi-ratical circulation; not to mention, uh, this wld result in a bigger, harder slewie.
Sign me up
It's all about results. Just give it a year or so and the PIIGS, etc. will settle the Keynes vs Austrian School argument for us. And as a bonus prove what a delusional asshole Bernanke is. And as an extra bonus let us watch the TBTF, Federal Reserve & Keynesianism disappear into oblivion.
i spent 20 minutes looking for the complete episode,
as i remember all 25 minutes were good. oh well, ...
think we are at the point where from here on out... money isnt what will be taxed...
but freedom.
It was the Austrian crap that sunk the world econ. With Reagan the USA went back to Hoover, et al. Nixon was insane.
Then Bush the second, who was gifted a balanced budget, and Greenspan who flipped Austrian and the world collapsed into psycho talk.
Look at it this way. Gravity can be viewed in various ways which defines its uses, limits, and potential. It is good we do not fly off the earth and bad when we jump off tall buildings. It is the latter that Austrian crap does not fathom. The market has good outcomes, and sometimes bad results. Math just shows the degree, and provides some identifiers. When the next Austrian tells you it is ok to jumb off tall buildings, you might think twice if you are capable.
You really have no idea what you are talking about. Reagan? Nixon? Hardly Austrian. Piss off with your silly attempt at demagoguery.
I'm full HILT on that remark! +1/2
Yes, Richard 'We're all Keynesians Now' Nixon employed Austrian economics. Greenspan the Academic is not the same thing as Greenspan the Central Banker. The latter was as far from Austrian as one could get. Bush and Reagan both worked form the Keynesian palybook as well. Hoover was FDR-lite, hardly an Austrian. Its amazing how much Wrong there is in such a short comment. Its funny to see people claim that Austrian economis brought all this about when Austrian economics features nowhere amongst policymakers and hasnt for decades. Keyenes 'won' the debate way back when and since then the world has operated under his principles. Now that it's all unravelling, people correctly question his theories and in a pathetic display of revisionism we have people like you trying to blame it on theories that were nowhere to be seen when it came time to make policy.
You are clueless
Paul Volker was an Austrian and he applied Austrian policies that saved the dollar.
send this guy back to the third rate ethnic quant ghetto he came from. Math, being simply a way to present a logical argument, is perfectly valid when used appropriately in economics. It's the bad models and empiricism that ruin things
Just remember ... economics is a "social science".*
* From Wikipedia: The social sciences are the fields of scholarship that study society. "Social science" is commonly used as an umbrella term to refer to a plurality of fields outside of the natural sciences. These include: anthropology, archaeology, business administration, communication, criminology, economics, education, government, linguistics, international relations, political science and, in some contexts, geography, history, law, and psychology.
Of course value exists outside the human mind. Any beast still values things. Value is inherent whether or not anyone notices or knows what to do with it.
The human mind tries to put a value to it, can communicate it, and people can herd into one viewpoint or another. Especially when it comes to scarcity, or things that are value added. Of course it can be wrong or right (more likely wrong, but to varying degrees). Just because man herds one way, doesn't mean it's right. Just because they settle at a certain point for a period of time, doesn't mean it stays that way. The value of things is inherent, and more value abounds that what man has so far discovered.
That's why as man progresses, he finds value in more things that were around previously but we hadn't discovered what to do with. Man also takes items in the world and alters them with the derivatives of such across many lines then being able to be combined and altered again into more value. Man is a toolmaker, and as better tools are made, more valuable items are created. One doesn't need to know how it's made to value it, either. Even a dog will enjoy a fast food hamburger. It knows it is something of value.
Value is seen across all living entities. Walk by a bee hive, or try to sleep in a lion's den. Try to take a banana from a gorilla. Whoever does so will see then, that value exists outside of the human mind. It's sophistry to say that man's consciousness creates value. It exists even if man's groupthink hasn't determined it yet.
However I am not arguing in any way that the conclusion in this specific case is wrong. The equations indeed mean jack shit. But one needs not be an austrian to understand that. Nor should we follow Menger because he stated what should be otherwise obvious if one hadn't been corrupted by even 'newer' forms of economics.
The austrian school is also a collection of people trained by Menger who then came up with their own 'newer' forms of thought, and generally it was slanted to holding the monarchs in power versus everyone else.
I would however state that the Austrian school, is indeed a form of modern economics. It's just pre-before-the-belief-in-this-sort-of-mathematical-statistical-dogma was adopted in earnest. The following three links in this post are more in depth than just the few quotes I pull from them.
http://www.larouchepac.com/node/16387
"The gurus of Rand Paul, and likewise of his father, Ron Paul, are the Austrian School (or, Austrian Stool) of his idol, Mickey von Mouse and his friends. Refer here to a 1995 presentation by Jeff Steinberg, titled The Legacy of Friedrich von Hayek: Fascism Didn't Die with Hitler. As you will read there, the Austrian School was founded by Carl Menger (1840-1921), a court retainer both of the degenerate Habsburgs, and also of the only known royal house which exceeded the Habsburgs in degeneracy: the Wittelsbach royal house of Bavaria and Schwanstein castle, correctly the target of some of Heinrich Heine's funniest poems.
The whole purpose of the school from the beginning, was to target for destruction the American System of political economy, which had been brought to Germany by Bismarck against the bitter opposition of those two degenerate monarchies. The tactic was a simple one, the same in use today: to falsely identify the American System of Alexander Hamilton and Friedrich List (the latter a special hate object), with the socialism of Saint-Simon, Hegel and Karl Marx. Once the British and their Habsburg satellites turned against Hitler, the equation was extended to equate the American System with "fascism" as well as "communism," as in Friedrich von Hayek's book, The Road to Serfdom, which Rand Paul periodically, worshipfully rereads."
http://www.larouchepac.com/node/16441
"Carl Menger explained to the Prince how the old feudal oligarchy of bankers and autocrats might maintain their death grip on humanity, against America's energy.
The old form of empire was breaking down. The Inquisition, the New Dark Ages religious police state imposed by the Hapsburgs on Europe, could not stand against the American ideal of separated Church and State. Austrian forces, occupying Italian principalities with mass imprisonment and executions, and Austrian sponsorship of the feudalism-mad Pope Pius IX, could not prevail against Emilio Cavour's genius. An ally of Lincoln's economist Henry Carey, Cavour unified Italy just as Lincoln became the U.S. President.
A new imperialism was required, based on global financial looting and new forms of colonial regimes outside Europe.
Carl Menger explained the new Liberal economics, worked out in concert with the British Empire.
Menger warned the Prince that the enemy doctrine of national sovereignty had spread from the arch-nationalist Lincoln to German Chancellor Otto von Bismarck, who copied Lincoln's tariffs and railroad-building strategy."
So again, while taking an honest approach to a base reasoning (that is inherent with sophistry) one can find flaw with modern economics correctly in this case, but that doesn't mean it should hold sway over other factors and make one more inclined to follow another set of dogmatic rules. It would be like relying on a broken clock because it's right twice a day and you happened to look at it when it happened to be correct...even though you curse your broken watch for being the same thing.
More from Menger from the 2nd link
"Menger's new dogma, that the State must not be allowed to interfere with financial freedom — the right of imperial financiers to deploy their Money Power — took its place beside other "liberal" anti-republican instruments forged in the Hapsburgs' crypts: pessimism in literature, soulless psychology, deliberate ugliness in art, crazed atonality to overpower Mozart's and Beethoven's beauty. (Carl Menger's brother, the socialist attorney Anton Menger, crystallized this assault on reason and progress into what became known as the Frankfurt School.)
Germans reacted to Menger's polemics against Lincoln and Bismarck by referring derisively to the "Austrian School" — meaning those who argue for the presumed logic of imperial Free Trade economics while declining to discuss any actual history whatsoever. This is the origin of the term, Austrian School, which has identified Menger's disciples such as Hayek and von Mises, Rand Paul's brainwashers.
Here is the Money Power against which the USA has struggled throughout its history.
In Menger's day, the extended royal family of Austria, Britain, and Belgium coordinated with international bankers for nightmare colonial experiments, such as the Congo."
The Austrian school will not free us from these bastards any more than keynesians. Because all of monetarism induced dogma is the playthings of monarchies and the top .1 percent(ish) throughout history. Economics as a whole regardin monetarist schools of thought (at least) has been used to keep the powerful, powerful against all others.
But indeed the equations we see today are bullshit, they work...until they don't. Because sometimes the herd is located there.
So if we are to cast off the chains of ultra faux modern economics, back to a 'purer' form of economics, we need to realize that even that 'purer' form, is riddled with bullshit sophistry, perhaps just a little less, but all of it, was used to keep the rich, rich above anything else.
The American System of political economy is in no way related to those the 'Austrians' claim it to be. That's the pro-monarchy/top class propaganda for which the Austrian school's job was to maintain. Of course here is some backstory on other 'Austrian' school of thought espousers.
http://www.larouchepac.com/node/16404
None of these guys had it right. It only 'appeared' thru their propaganda, that the grass is greener versus the Keynesians. Monetarism is the enemy. Austrian school is still a monetarist school, created to keep monarchies, like the Hapsburgs, in power. So of course, Keynesian or Austrian, or other, monarchies know how to play either card, especially since the most famous of monarchies, is a descendant of a hapsburg, known as Queen Elizabeth.
Keynesians used dogma based on sophistry to build up the debt, Austrians use dogma based on sophistry to pay it off...and through it all, nothing is actually accomplished based on these schools of thought, rather they all get in the way. What a fucking waste of time. The disconnect from reality goes back thousands of years, to the Oracle of Delphi, and Aristottle's reasoning that sophistry is real if everyone believes in it. What's real is real, and herd mentality and groupthink doesn't make something real. But this sophistry has been inherent in every form of economics that tries to keep the top in power and in affluence. As far as I know, the only break from this, was the American School of political economy, it's American Credit System, and because it broke from thousands of years of bullshit is what made what we accomplished with our little revolution, so special. We need to get back to that. Ditching sophistry in our structure and basing it on what's real because it is real and based on universal properties, aside from what anyone thinks, is a truer baseline, and a better foundation from which to build a true PHYSICAL economy, which benefits all, and leads to better focus, innovation, and wealth. The human mind doesn't create reality, it just interprets it, and basing it on the wrong thing, leads to flaws. All these schools follow the wrong baseline, and are inherently flawed because of it. It's universal properties, not the mind, nor the differential equations thought up by it. We don't create the universe we live in it. Aspiring to create something in the mind is not the same (nor will it achieve the same results) as aspiring to create something from the mind based on the physical properties and created physically in the universe.
Perhaps my way of describing it is flawed, but my point is real. Fuck monetarism, sophistry, and the economics built ontop of them. We can't keep following the various models of broken compasses each sailor might have on them. But if a sailor looks up at the stars....
Glass-Steagall
I disagree that a beast can place a value on something. One aspect of an entity that places "value" on an object is to hoard the objects. I'm not sure I know of an animal that hoards anything. A puppy that likes his bone will chew on it till satisfied and then will walk away. Another aspect of "value" is quantitative (a metric) i.e. I like that coconut so much I will trade my three pretty stones for it. And that brings up the third aspect of value which is trade. If there is not trade there is no estimate of relative value. I believe that only the human mind, in all the animal kingdon, conceives of hoarding, rates relative values numerically , and will trade one valued object for another.
In this case I will side with the Austrians.
A squirrel collecting nuts for the winter?
A nut collecting squirrels for the winter?
The squirrel hoards but does not trade acorns as far as I know. Maybe for female favors ...
"Of course value exists outside the human mind. Any beast still values things. Value is inherent whether or not anyone notices or knows what to do with it."
Animals probably do have a primitive understanding of value. That doesn't change what Menger is trying to convey. The brain (human, animal, or other) creates value. Even if they don't (which is bullshit, they do), they are still the only entities capable of understanding it and thereby acting on it. IS THERE ANY EQUATION THAT CAN PREDICT FORETHOUGHT?
Universality is a concept that occurs in human minds. That is not a check against universality but a necessary evidence of it. Trying to separate yourself from your context is humorously admirable, a little crazy and sadly unethical towards yourself. Your principles elucidates who you believe yourself to be and indicates what role you play in the evolution of the the universe of which you are a contributor. So yes we create the universe in a quite ongoing manner. But, I also suspect we are probably not very important in the grand scheme of things...
Long ago Adam and Eve let the genie out of the bottle
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Ron Paul rocks. You know and I know he will never be elected. That never stopped me from donating stating with the Tea Party moneybomb in December of 2011.
DOnt have to send much money $5.00 helps.
Maybe his kid Rand could be viable in 2106 or 2020.
Thanks for the talk of Mises etc.
The son is a faux liberatarian.... I have seen him commit intellectual and ideological suicide when discussing health care issues, e.g. Medicare and how doctors are reimbursed.
In 2106 comeone'll look back and say "I heard once there was an attempt at a free society", the other will shake head, roll eyes and the discussion of coke vs pepsi on the chain gang will continue.
During the stupid questions part of the debate, I wish they had asked Ron Paul "paper or gold?"
Thanks TD for the quote from Menger that "value does not exist outside mankind's consciousness." This is what I was trying to say yesterday in response to a post claiming that value is quantifiable, but Menger said it much more eloquently.
For all you folks who seem irrationally attached to quantification, might I recommend the second chapter of Gregory Bateson's book Mind and Nature, entitled "Every Schoolboy Knows..." where he basically demolishes many ideas that seem to have currency today, by showing that the presuppositions supporting them are just not true. For example, he argues (very persuasively) that:
1) Science never proves anything
2) The map is not the territory, and the name is not the thing named
3) There is no objective experience
4) The processes of image formation are unconscious
5) The division of the perceived universe into parts and wholes is convenient and may be necessary, but no necessity determines how it shall be done
6) Divergent sequences are unpredictable
7) Convergent sequences are predictable
8) Nothing will come of nothing
9) Number is different from quantity
10 Quantity does not determine pattern
11) There are no monotone "values" in biology
12) Sometimes small is beautiful
13) Logic is a poor model of cause and effect
14) Causality does not work backwards
15) Language commonly stresses only one side of any interaction
16) "Stability" and "change" describe parts of our descriptions
When I first read this years ago, I was blown away, as it wreaked my entire belief system and I had to start practically from scratch to put it back together. Fortunately, not everything was destroyed, so there was something to work with, but for you souls with a thirst for understanding, there are not many books that offer more insights into the real world than this one. Red pill warning: there is no going back.
Number 14 is true to the extent it is fossilized.
In time the effect comes before the cause, in logic the cause comes before the effect. The cause is objectively-subjective, the substance of which is constantly subject to debate.
A cause is logically necessary in order for an effect to have occurred. However, the cause is a matter of argument and reasoning and is by logical necessity possited by finite minds to occurred prior to the effect.
Metaphysics, love it!
Quit redefining the English language! Crap is crap, not 'rubbish'!
Aoccdrnig to a rscheearch at Cmabrigde Uinervtisy, it deosn't mttaer in waht oredr the ltteers in a wrod are, the olny iprmoetnt tihng is taht the frist and lsat ltteer be at the rghit pclae. The rset can be a toatl mses and you can sitll raed it wouthit porbelm. Tihs is bcuseae the huamn mnid deos not raed? ervey lteter by istlef, but the wrod as a wlohe.
Very interesting. I actually read that with very little problem...
Me, too.
It was very similar to many other posts here. We're getting used to it.
"value does not exist outside mankind's consciousness " . ..... luv it. this is why i really like this website, so much to learn, so much education, i'm thinking & exercise my (old) mind more than i've ever done ! i've learned so much from ZEROHEDGE ...... & I LIKE IT !!!
dogs value bones
How else would Chip and Dale make it through the winter?
HA!
http://www.youtube.com/watch?v=lN-4lX0QyZc
Austrians think if a tree falls in the forest and you didn't hear it, it did not fall. Whatver they can think/dream,makeup is reality.
It is crap. And it demontratively has not worked.
Where has it been tried?
- just a curious cat
What you wrote is not only incorrect, but profoundly shallow.
Reality is always already contaminated by human perception.
Pertaining to the value of any one thing, that is a jointly, but never truly established determination of the participating minds who perceive the subject, either emperically or contemplatively.
Value determination, though subjective, is not without rules.
And, how has it "demonstrably" not worked? How can it not work? If the system is imaginary how do you demonstrate its impracticality?
You are confusing the Austrians with what the Bernank does. To be objective one must be able to account for the subject in the item under perception. The neoclassical mechanistic approach to economics does not account for the feed back loop of perception and hence dictatorially hands down practical, economic, rules that do not work,... demonstrably so.
it's probably ME. Do I sense a bit of [political] BACK tRACKING> here?
Just you. Me, I've always considered Libs as "what's for dinner".
Beats meat loaf. 'Course the Libs don't read the 'loaf' part.
hey, Y/C! i saw something you wrote while in jet-lag. something about 80.3 on the $/Yen scale.
so, i start watching to see what happens and the sumbich goes right thru it and settles back @ 80.43.
whazzup w/ that?
will go ride bike & chk l8r.
...pray for my safe return...
Dam chartists like Y/C. I just luv to dive in when it feels right.
I don't pick your stops? If I did , they would be in that gbp/yen trade?
yes i love you to.
Nah, I pick my own stops. Nobody else does USDHUF, remember?
LMFAO! Good one!
sell the Bid just under 81! Oh no! Now every wonder wizard is on that one?
Best to your family and yourself Slewie. I always have your back! YEN/YEN (dot)
Got your back YEN. AAAAAAAAAAAAAAAAAAAAAAAAAAHHHHHHH
Rusty you are the shinny XAU nugget in my bag! +1 and thanks! Yen
aah hoo
http://www.youtube.com/watch?v=1MRu8N2K0NY&feature=share
Where wolfs of London. Nice work! That tune never grows old!
thx, Y/C!
LOL---on the "Weekly Risk..." string, smbdy (bakken) just wrote (Paste): YES, ME TOO, TECHNICALS ARE STRONG ON THE DOLLAR JUST NOW. O.81 top near term???
wag that dog, BiCheZ!
Slewie every one is affraid of intervention. 85 is the range off those march lows. i f you want to trade yen, trade it against commodity currencies. Yen
All the Austrians flunked math.
Are we talking CHF or AUD? Smiles.
With Senta Berger in your class, you would flunk everything.
Whendys? Lol
Geez, you are young.
Not really. just @ heart.
It is indeed all about perception and belief. And the balance of mankind is starting to awaken from its trance and believe something else.
How does this affect my OBama stash?
http://www.youtube.com/watch?v=19v5Kjmc8FI
I just spread the otool love. Nice work Myan.
YES!!!
Why is it so hard for people to understand this? Maybe there is a set of equations, but we do not possess them and I doubt we will anytime soon. To possess such equations is to accurately describe human consciousness. To predict human thoughts and actions.
Consequently, no one person, or group of people, has the ability to effectively manage an economy by applying equations that do not exist. The idea that central banking can effectively manage the economy is invalid. That leaves us with only one reason for it's existence. To serve those who are in control.
i ride on your back. why do you not believe,
when i tell you, that it is for your own good?
keep walking and marching on. i am not on your
back and you should know it !
walk on.
I couldn't agree more. I have always felt that the various "______ism"s people cling too, often with the adherence of a religious devotees, entirely rest upon a set of artifically contrived and poorly engineered values. Amazing that people still want to continue and/or repeat the Frankstein economic experiments, totally ignoring previous outcomes (read: definition of insanity). The Chicago School, the Princeton School, the Keynsian School, the Marxist School, et al, are ALL discredited. All of them.
The dumb-as-a-box-of-rocks school? No offense to the Moon...
Might have to run this thru Blabbermouth Schultz's office.
And a few other orifices? C I can Spell.
We need more spending!
We need to tax those "rich" at 110%!
Then we can work down to those cretins paying nothing......
the flash mob hamburglar crowd?
Speaking of cretins.
Actually, the dummy in the video said knowledge was not possible. All science is mere opinion.
Therefore unusuable. The voices in his head are the truth.
Got no income?
Have 2 kidneys still working?
Pay no tax?
UNKKIE SAM needs YOU! Pelousy needs you!
NOW!
PillHOSEY.
http://www.uwmpost.com/2007/04/09/donate-an-organ-save-a-life/
but the life you save may not be worth it.
If i could even afford it? Saddle Back Ben has done a good job! Sorry too much "BONANZA" yen
Economics a science like playing a board game is a science. It's a set of rules all of which are human constructs. All these rules are changeable and manipulated to varying degrees.
Science is a process of formulating models that predict outcomes in a natural system under certain conditions, and then testing them to see if the future predictions agree. However, the goal is to find how the model is inadequately representing the natural system. When the model is refuted, it is adjusted to form a new model from what is learned about the system. Since there is an underlying system that is being approximated by the models, there is an "objective reality" (exists independently of human conceptualization) to be described by conceptual models. The models evolve representations of the relationships and features that are defined by the system. Models are useful to humans. Models are respected when they better reflect the nature of the system.
Economics is an artifact of human imagination and all human conceptualization, and the agreement among certain humans who "play the games" together -- thereby it is a social technology. There is no underlying physical reality other than what is identified by the players to be components. Nevertheless, the economic properties are determined by and limited only by the beliefs of the "players." To build economic models one must assume certain features, and the models become part of the generators of the results. Since they are not inherently tied to the physical and biological realities(no physical referent), they may fail arbitrarily as the physical and biological world view of humans change -- or as people believe the physical and biological world exists. Economics in large part reflects human belief systems. Modern economics does not exist if we collectively don't believe it. You can't say the same about thermodynamics.
Economists are university trained excuse makers and occasional scapegoats that use post hoc reasoning for all 'economic' phenomena. - wrapped in complex math to give them the veneer of scientific legitimacy. It's just another branch of politics and a kind of social engineering - which is also controlled by those with the most capital.
The growth and profit necessity creates, through mass communications, a constant culturally-induced striving for perennially unsatisfiable desires that often conflict with? basic bio-cultural needs. The result is the? hominid at the end of the evolutionary sequence if not corrected. It's essentially dopamine hijacking(much the way people ruin themselves in Vegas) propaganda that creates cultural junky mentality and anxiety status purchases as well as unrepairable ecological damage
Economics is largely? a self-fulfilling psychology. It effectively constructs a model of behaviour, to a model for behaviour; whereby such models educate us to think how we’re ‘supposed’? to think. As a result, this pseudo-science has maintained a heavy reliance upon seeking numerical legitimacy and mathematical reassurance for justifying assumptions of rationality.
Even the "value that does not exist outside mankind's consciousness" can be influenced i.e. manipulated.
Modern economics can't be a science, not even a social science. It's game theory with underlying assumptions that have nothing to do with biology, neurology, natural systems or evolution.
Yeah except that's not what economists do. They don't practice science. They practice Frankensteinism.
Bernankenstein sews an arm on the corpse. Clear! Zap. Monster abmbulates into town killing villagers, followed shortly thereafter by pitchforks, torches to the Bernankenstein mansion. Apologies from the Bernank. Sorry folks, won't happen again. I know what I did wrong.
He goes up to the lab, cuts off the 16" arms and sews some 20" guns on the monster. Clear! Zap.
Monster goes into town. Kills more villagers and this time tears down a few houses. More pitchforks and torches and this time the townsfolk are REALLY pissed. Hearings are held. More apologies from the Bernank.
Next he gives the monster a titanium endoskelton and adds two feet to his height. Clear!. Zap.
Monster destroys entire town. Bernankenstein boards plane and flys to Switzerland seeking asylum.
What the Federal Reserve is doing is NOT science. It's repeating the same fucking Frankenstein experiment over and over again, each time with a bigger monster, until the village is eventually destroyed.
Neoclassical Economics is the intellectual trojan horse of the millenia. All of it It came in handy when a bunch of 18th century plutocrats wanted to challenge the monarchy and needed an ideological rejoinder to feudalism. It also came in handy with the serfs that were increasingly revolting for a social organization. Now this anglo-saxon social engineering program is coming to an end. The ruling party is doing a fantastic job at slowing the revolution and collapse, but they can't forever. If they did not gang rape the market back in 2008-2009 it would have happened all ready. Whatever they do will look like a failure. Doom is baked in the cake.
Economists enamored of pure markets begin with the theory, and hang models on assumptions that cannot themselves be challenged. The characteristic grammatical usage is an unusual subjunctive — the verb form ‘must be.’ For example, if wages for manual workers are declining, it must be that their economic value is declining. If a corporate raider walks away from a deal with half a billion dollars, it must be that he added that much value to the economy. If Japan can produce better autos than Detroit, there must be some inherent locational logic, else the market would not dictate that result. If commercial advertising leads consumers to buy shoddy or harmful products, they must be ‘maximizing their utility’ — because we know by assumption that consumers always maximize their utility. How do we know that? Because to do anything else would be irrational. And how do we know that individuals always behave rationally? Because that is the premise from which we begin. The truly interesting institutional questions — the disjunctures between what free-market assumptions would predict and the actual outcomes — are dismissed by the tautological and deductive form of reasoning. The fact that the real world is already far from a perfect market is ignored for the sake of theoretic convenience. The dissenter cannot challenge the theory; he can only describe the real world.”
— Robert Kuttner, EVERYTHING FOR SALE
I like the quote from Kuttner. +++
You clearly have a lot to learn. I strongly recommend reading Human Action and The Ultimate Foundation of Economic Science by Ludwig von Mises. Both are free online.
>There is no underlying physical reality
Huh? Are you saying human brains aren't elements natural science?
>Science is a process of formulating models that predict outcomes in a natural system under certain conditions, and then testing them to see if the future predictions agree.
You're talking about the scientific method. It is not a needed nor appropriate epistemology for all domains of knowledge; consider e.g. the science known as mathematics.
FYI, as von Mises explains, the idea that knowledge produced apart from the scientific method is not scientific is itself an unscientific and unfalsifiable dogma. In fact, all truth is ultimately rooted in the human mind. For a positivist who views the world as a mere concatenation of natural phenomena, there can be no true or false ideas: a human brain as an element of natural science cannot yield patterns that are true or false any more than a stomach can produce acid that is true or false.
Are you saying human brains aren't elements natural science?
Sure, where in any economic theory has neurology in it's doctrine?
It's all tautology. Nothing can be proven! It's all in the mind! If markets were freer the invisible hand would be giving us reach arounds. It's all bullshit.
You're like the Christians at the end of the Roman empire that insisted it was because of homosexuality. You are holding on to a dead philosophy by going to another priest.
>Sure, where in any economic theory has neurology in it's doctrine?
Where in the world did you get the idea that economics NEEDS the study of neurology as it's basis?
Would you found the science of chemistry based on quantum chromodynamics? After all, molecules are nothing but a bunch of quarks and electrons.
Again, read the books I recommended before spouting bullshit on subjects you know nothing about.
>You're like the Christians at the end of the Roman empire that insisted it was because of homosexuality. You are holding on to a dead philosophy by going to another priest.
No clue WTF you are talking about here.
http://www.youtube.com/watch?v=P36x8rTb3jI&feature=related
Only Libs get it.
Over Chuky'E Cheese @ the welfare office?
Yep, she's probably squatting in her home right now and with new green energy, gas will be obsolete. Here dream has become manifest...
Only if she can get her groceries paid for with food stamps delivered for free by meals on wheels. Will her doctor that accepts Medicaid make house calls?
Newsflash: And those fluffy white things floating in the sky are actually clouds.
Yeah...no kidding!
What economy? With over 74% of the GDP nothing but fantasy finance, THERE IS NO ECONOMY!
What is so difficult about that to grasp?
Also, there is no media, but everyone should already comprehend that!
C + I + G + X − M = Y(GDP)
The equations doesn't have an entry for theft. No wonder it doesn't work.
You said: "Everything that humans do is measurable."
Is a qualitative shift from greed to non-greed measurable?
How much is a single vote worth in 2012?
Economics is the attempt to quantify human trust.
Trust is the basis for all economics.
Do I trust you to make good on your promise.
I'll give you these tokens for that food.
Do you trust me to redeem these tokens for something that you desire at a later date.
Do these tokens have value as I say they do?
Who makes these tokens?
Do they value them the same as you and I?
Can I loan you some of these tokens? Will you pay me some of those tokens to lend to you. Is that immoral? I have tokens that you need, why shouldn't you pay me some tokens to borrow some of mine?
If there are more people, why can't we make more tokens? Then everybody can have some.
You can still redeem them for things that you need. Honest.
gh
Wow! A mathematician that waxes philosophical!
I really enjoyed that! Thanks, Tyler!
ha ! found it.
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Keiser Report: Silver Stick for JP Vampire (E118)
Posted on February 3, 2011 by maxkeiser
http://maxkeiser.com/2011/02/03/keiser-report-silver-stick-for-jp-vampir...
A distorted version of economics has been reduced to being a tool which the central bankers use to justify their decisions which result in the national wealth being transferred to a small percentage of the population leaving the rest of the population and their future generation with the debts incurred as a result of the losses of gamble trades of the rich.
http://www.marketoracle.co.uk/Article24581.html
No wonder I failed economics.
I got an Econ degree many decades ago when Keynes was a god, Milton Friedman was a revolutionary, "Austrian" meant wiener schnitzel or 'The Sound of Music' and the family von Trapp, and 'quantitative' was synonymous with 'cool.'
I sat through every worthless class thinking 'this is complete bullshit...no one can quantify or predict human behavior over the long-term.' (Yes, GS can do it today for nanoseconds).
After all those mediocre B's and all these years, 'the hills are alive' with the cold, hard truth that we only admitted about Marxism back in the 70's: rigid, didactic economic ideology kills those it is intended to help and then blames the victims for its failure.
test
So basically, economics is a religion...