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Swings, maybe. There's room for forecasting at larger or smaller intervals, even if swings are unforecastable. That said, I don't think most big financial event
by netcan 5y ago
Swings, maybe. There's room for forecasting at larger or smaller intervals, even if swings are unforecastable. That said, I don't think most big financial events are
black swan events in some sense but not others.
Financial black swans don't tend to be random, real world events. We're living through a major real world event now, and the financial markets haven't collapse... though a lot of weird stuff is happening. The 2008 crisis and many others had not real world. Real world links were gradual and fairly financial in nature, an accumulation of debt/risk/leverage/lies/fragility or whatnot over time.
These are more like bugs, design flaws or fail conditions, IMO.
From a financial analyst's perspective they're "black swans" because they are events with a >0% likelihood that (by definition) are not priced into security prices or financial systems.
From a forecasting model POV... who knows.
In any case, forecasting the future of the economy is probably very very hard. If it's possible, it probably has epic sci-fi level consequences.
- sprafa 5y agoJim Simons and Bob Mercer used Ml to solve the market a decade plus ago. Good book on the topic is The Man Who Solved the Market
- trashtester 5y ago> We're living through a major real world event now, and the financial markets haven't collapse... Central banks are pumping money into the economy at a record rate right now, and still not able to get unemployment down to "normal" levels. This causes supply chain problems and inflation signals that , unless they get resolved, will force the central banks to pull back most of the stimulus. THAT is when the crash will come (if at all). If that comes, central banks will have a choice. Double down on the austerity, raise taxes and try to weather the storm, or restart the money printer and risk very high inflation, if not hyperinflation. My bet is on the latter, as goverment obligations are so high right now that I doubt they have the stomach for austerity. This crisis is not over....