6 ms·

Do you have anything to back that statement up, other than 20/20 hindsight? I'll admit that few economists get timing right on big macro events, but please don'

by spangry 11y ago

Do you have anything to back that statement up, other than 20/20 hindsight? I'll admit that few economists get timing right on big macro events, but please don't tar us all with the same brush: https://news.ycombinator.com/item?id=10166958 https://news.ycombinator.com/item?id=10166958 If you want to see some decent economic commentary, look here: http://www.macrobusiness.com.au/ http://www.macrobusiness.com.au/ . These guys have been screaming bloody murder for at least the past year.

dandelany 11y ago
How about the fact that index funds consistently outperform actively managed funds?
- spangry 11y ago
  And the relevance of this is...?
  - dandelany 11y ago
    You asked for evidence backing up the statement "People whose day job is to predict this stuff can't even make good predictions". Managers of active mutual funds are exactly these people. The fact that they can't beat the market is clear evidence they can't make good predictions. Of course you could say "well, the good managers beat the market, even though on average they don't". But you could also say that the few people who correctly predict three coin flips in a row are "good at predicting coin flips" - it's easy to say this in retrospect but impossible to predict who the "good ones" are upfront.
Throwaway23412 11y ago
The whole concept of "being good at prediction" is extraordinarily difficult to back up. If you were even a few percentage points better at prediction (especially economic predictions) than the average person, your life is pretty much made. You would literally be better than the average person at seeing into the future. There is a 1% of people (Warren Buffett and James Harris Simons for example) who are significantly better than the average person at predictions, but chances are some random Australian on a tech forum is not part of that 1%.
- spangry 11y ago
  I'm sorry, when did I claim I was some kind of share market mastermind? I wouldn't have a clue on how to work the stock market. I think you and I have very different definitions of the word 'economist'. I'm guessing you're one of those folks who think 'economics is all about money'? Doing company valuations and making share market predictions are very different from having an understanding of macroeconomics or tax theory in a public policy context. And very few people are good at prediction (myself included), and even fewer when it comes to timing. Economists have predicted 8 of the last 2 recessions :)
- etherael 11y ago
  This is hilarious, or would be if the consequences were not so sad. It's listening to someone standing on the deck of the titanic talking about the complexity of the design of the ship, how many great and esteemed members of the establishment signed off on it, and how crazy it is that anyone on the deck is pointing out that it's sinking because they can actually see it sinking, like anyone else can that actually looks at the horizon. This is not a rebuttal. Arguments from authority about why the masters of the universe have it all figured out and those who are pointing out that they have no clothes are just clueless barbarians at the gate are fundamentally invalid. Complexity, obfuscation and worship at the altar of authority do not actually make for solid fundamentals. This ship is going down, massively increasing the tokens for the representation of scarce resources so that the people who controlled the tokens back the last time they completely failed, does not make the people that controlled those tokens any more competent than they were at the actual game in question last time they failed. All the central bank moves, the macroeconomic obfuscation, lies, Keynesian nonsense, negative interest rates, cash ban proposals, underhanded capital controls, worldwide currency wars, geopolitical games with oil to back fundamentally worthless scrip, bail-ins, bail-outs etc, none of it changes the underlying fact that the presently dominant system ordering the allocation and distribution of scarce resources is, as you sit here on the deck of the ship dismissing that fact, sinking below the horizon.
  - spangry 11y ago
    Yes that is exactly what I'm doing; you've cleverly seen through my subterfuge. I concede the argument to your superior reasoning and reading comprehension. EDIT: Well this is embarrassing. I apologise to the guy above and below me. I guess it was actually my superior reading comprehension...

by spangry 11y ago

dandelany 11y ago

How about the fact that index funds consistently outperform actively managed funds?

spangry 11y ago
And the relevance of this is...?
- dandelany 11y ago
  You asked for evidence backing up the statement "People whose day job is to predict this stuff can't even make good predictions". Managers of active mutual funds are exactly these people. The fact that they can't beat the market is clear evidence they can't make good predictions. Of course you could say "well, the good managers beat the market, even though on average they don't". But you could also say that the few people who correctly predict three coin flips in a row are "good at predicting coin flips" - it's easy to say this in retrospect but impossible to predict who the "good ones" are upfront.

Throwaway23412 11y ago

The whole concept of "being good at prediction" is extraordinarily difficult to back up. If you were even a few percentage points better at prediction (especially economic predictions) than the average person, your life is pretty much made. You would literally be better than the average person at seeing into the future. There is a 1% of people (Warren Buffett and James Harris Simons for example) who are significantly better than the average person at predictions, but chances are some random Australian on a tech forum is not part of that 1%.

spangry 11y ago
I'm sorry, when did I claim I was some kind of share market mastermind? I wouldn't have a clue on how to work the stock market. I think you and I have very different definitions of the word 'economist'. I'm guessing you're one of those folks who think 'economics is all about money'? Doing company valuations and making share market predictions are very different from having an understanding of macroeconomics or tax theory in a public policy context. And very few people are good at prediction (myself included), and even fewer when it comes to timing. Economists have predicted 8 of the last 2 recessions :)
etherael 11y ago
This is hilarious, or would be if the consequences were not so sad. It's listening to someone standing on the deck of the titanic talking about the complexity of the design of the ship, how many great and esteemed members of the establishment signed off on it, and how crazy it is that anyone on the deck is pointing out that it's sinking because they can actually see it sinking, like anyone else can that actually looks at the horizon. This is not a rebuttal. Arguments from authority about why the masters of the universe have it all figured out and those who are pointing out that they have no clothes are just clueless barbarians at the gate are fundamentally invalid. Complexity, obfuscation and worship at the altar of authority do not actually make for solid fundamentals. This ship is going down, massively increasing the tokens for the representation of scarce resources so that the people who controlled the tokens back the last time they completely failed, does not make the people that controlled those tokens any more competent than they were at the actual game in question last time they failed. All the central bank moves, the macroeconomic obfuscation, lies, Keynesian nonsense, negative interest rates, cash ban proposals, underhanded capital controls, worldwide currency wars, geopolitical games with oil to back fundamentally worthless scrip, bail-ins, bail-outs etc, none of it changes the underlying fact that the presently dominant system ordering the allocation and distribution of scarce resources is, as you sit here on the deck of the ship dismissing that fact, sinking below the horizon.
- spangry 11y ago
  Yes that is exactly what I'm doing; you've cleverly seen through my subterfuge. I concede the argument to your superior reasoning and reading comprehension. EDIT: Well this is embarrassing. I apologise to the guy above and below me. I guess it was actually my superior reading comprehension...