Re:How Fake Money Saved Brazil (2010)
by dv_dt on Saturday September 03, 2016 @04:40PM
(#12421091)
Because the ability to predict outcomes is a key validator of any scientific field. If civil engineers couldn't predict if a bridge will hold up or fall then we couldn't and shouldn't rely on huge portions of our transpiration network. Similarly with economists, if the field can't forecast the instability of a major sector of our economy then we shouldn't put a tremendous amount of trust on their field for policy.
And 2008 wasn't just any economic event, it was a major event which nearly took down the world economy because the financial sector hyperextended and intertwined risks. The economic field had no widely accepted or reliable metric to predict that crash.
Public health experts have a very good model for spreads of diseases, models which have been validated many times against real world data, and then therefore can be relied upon to direct resources to help prevent dangerous spreads of disease. Not so with the economic field...
And 2008 wasn't just any economic event, it was a major event which nearly took down the world economy because the financial sector hyperextended and intertwined risks. The economic field had no widely accepted or reliable metric to predict that crash.
Public health experts have a very good model for spreads of diseases, models which have been validated many times against real world data, and then therefore can be relied upon to direct resources to help prevent dangerous spreads of disease. Not so with the economic field...