We'll be stuck in this recession for years, economists say • Hacker News Board

Re: We'll be stuck in this recession for years, economists say

#41

Post by Guzba » Thu, Aug 27, 2020, 5:39 PM UTC

Afforess wrote: post #24

Guzba wrote: post #11

Economists are as effective as astrologists at predicting the future. For some reason otherwise smart people don't realize this? I think it's something about economists being associated with the university system. I see this assured economic doom repeated so much without being questioned as anything but guaranteed I wonder where this incredible confidence is coming from? We have literally no idea what 2021 holds for…

> Economists are as effective as astrologists at predicting the future. [citation needed] > I see this assured economic doom repeated so much without being questioned as anything but guaranteed I wonder where this incredible confidence is coming from? All the stock market gains are from big tech. Any other markets are flat or down. ( https://finviz.com/map.ashx?t=sec&st=ytd )

Quick Google search, nearly top result. Committing the sin of just reading the headline but man this is not hard to find evidence: https://www.bloomberg.com/news/articles/2019-03-28/economist...

Or maybe? https://fivethirtyeight.com/features/economists-are-bad-at-p...

"All of the gains are from big tech". All of the gains are always from some companies and all of the losses are always from others. This is just how the pie got sliced 2020. I don't think it has any special meaning we can divine from it?

Re: We'll be stuck in this recession for years, economists say

#42

Post by mikeyouse » Thu, Aug 27, 2020, 5:40 PM UTC

daenz wrote: post #17

UncleOxidant wrote: post #14

Earlier quoted context omitted.

Exactly. Like in the 30s the government should step in and hire people. Companies can't do that in a recession/depression. However, the other side of Keynesian economics that's not as often cited is that during the good times the government saves up for the inevitable bad times - we haven't done that for a long time.

>Like in the 30s the government should step in and hire people What does the government usually hire people to do in this situation?

In the 1930s, it was the PWA which built tons of long-lasting infrastructure including the Hoover Dam and many substantial other projects;

https://en.wikipedia.org/wiki/Public_Works_Administration

That was probably the best use of funds at the time since there was broad based unemployment among a largely unskilled population. This time around, it seems like it's mostly service businesses that are struggling so it's not so clear what the best use of labor would be..

Re: We'll be stuck in this recession for years, economists say

#43

Post by pm90 » Thu, Aug 27, 2020, 5:41 PM UTC

nradov wrote: post #38

maccam912 wrote: post #21

Earlier quoted context omitted.

When it's a survey of many economists I tend to put stock in what comes out. In this case if 80% say there is a 25% chance of a second dip, thats a much more informed opinion than I could ever have on the subject. I now know it isn't likely so don't plan my life around waiting for the second dip, but also don't be too surprised if we do see a second dip.

How accurate were those same economists with their previous predictions? Were they more accurate than random people off the street?

Yes, they’re more accurate than random noise. Unfortunately like with any science which seems impactful on people’s lives, there is a lot of drama around people who try to become famous by making predictions and then failing. But the science itself is on firm ground.

Re: We'll be stuck in this recession for years, economists say

#44

Post by haltingproblem » Thu, Aug 27, 2020, 5:41 PM UTC

Asking an economist to diagnose is to ask the doctor who operated on you and removed a kidney when you were just there for a root canal to fix the problem. He goes in and performs a lobotomy but you are so taken by their lab coat and academic credentials and best paper awards and citations that you ask them to fix it. They go in and install a stent. A few days later you are dead because your forgot to take your anti-rejection drugs because of your lobotomy.

Obligatory Nassim video dunking on Economists:

https://www.newyorker.com/video/watch/nassim-n-taleb-and-rob...

Re: We'll be stuck in this recession for years, economists say

#45

Post by polote » Thu, Aug 27, 2020, 5:41 PM UTC

Afforess wrote: post #24

Guzba wrote: post #11

Economists are as effective as astrologists at predicting the future. For some reason otherwise smart people don't realize this? I think it's something about economists being associated with the university system. I see this assured economic doom repeated so much without being questioned as anything but guaranteed I wonder where this incredible confidence is coming from? We have literally no idea what 2021 holds for…

> Economists are as effective as astrologists at predicting the future. [citation needed] > I see this assured economic doom repeated so much without being questioned as anything but guaranteed I wonder where this incredible confidence is coming from? All the stock market gains are from big tech. Any other markets are flat or down. ( https://finviz.com/map.ashx?t=sec&st=ytd )

> https://finviz.com/map.ashx?t=sec&st=ytd

This viz is amazing

Re: We'll be stuck in this recession for years, economists say

#46

Post by icedchai » Thu, Aug 27, 2020, 5:41 PM UTC

Guzba wrote: post #11

Economists are as effective as astrologists at predicting the future. For some reason otherwise smart people don't realize this? I think it's something about economists being associated with the university system. I see this assured economic doom repeated so much without being questioned as anything but guaranteed I wonder where this incredible confidence is coming from? We have literally no idea what 2021 holds for…

They're pointing out the obvious. Do you think tons of people are going to start dining out again? Going to gyms? Going to the movies? Large parts of the economy will be soft for years. Much of it will never come back due to semi-permanent shifts in behavior.

Re: We'll be stuck in this recession for years, economists say

#47

Post by realmod » Thu, Aug 27, 2020, 5:42 PM UTC

jug wrote: post #25

hbosch wrote: post #19

Are we actually in a recession right now?

Was just about to say this. My equity funds are back to ≈85% before pandemic on average. One of them is better than before it. And that is coming from a very highly valued market due for a correction for years.

Stock market =/= economy. I think a big part of the gains is that everyone is flush with cash with nowhere to invest since the interest rates are basically non-existant/negative.

Re: We'll be stuck in this recession for years, economists say

#48

Post by UncleOxidant » Thu, Aug 27, 2020, 5:42 PM UTC

jug wrote: post #25

hbosch wrote: post #19

Are we actually in a recession right now?

Was just about to say this. My equity funds are back to ≈85% before pandemic on average. One of them is better than before it. And that is coming from a very highly valued market due for a correction for years.

Stocks are being buoyed by interventions from the Fed. There's a decoupling of the stock market and the economy. Those of us in Tech don't feel the pain much, but in the wider economy layoffs and pain are beginning to spread. Companies that took PPP money had to agree not to lay off people until the fall. Those stipulations end soon and there are large employers (airlines, banks, etc.) that have already announced that they'll have large layoffs in the next month or two. Add in small businesses that are going under (restaurants being hit hard, for example).

Re: We'll be stuck in this recession for years, economists say

#49

Post by lukifer » Thu, Aug 27, 2020, 5:43 PM UTC

Guzba wrote: post #11

Economists are as effective as astrologists at predicting the future. For some reason otherwise smart people don't realize this? I think it's something about economists being associated with the university system. I see this assured economic doom repeated so much without being questioned as anything but guaranteed I wonder where this incredible confidence is coming from? We have literally no idea what 2021 holds for…

From Philip Tetlock's Superforecasting [0] to Robin Hanson's Futarchy [1], there's a strong argument that predictions are entirely valueless without "skin in the game", be it in reputation score, or dollars.

[0] https://en.wikipedia.org/wiki/Superforecasting:_The_Art_and_...

[1] http://mason.gmu.edu/~rhanson/futarchy.html

Re: We'll be stuck in this recession for years, economists say

#50

Post by hirundo » Thu, Aug 27, 2020, 5:43 PM UTC

Guzba wrote: post #11

Economists are as effective as astrologists at predicting the future. For some reason otherwise smart people don't realize this? I think it's something about economists being associated with the university system. I see this assured economic doom repeated so much without being questioned as anything but guaranteed I wonder where this incredible confidence is coming from? We have literally no idea what 2021 holds for…

> Economists are as effective as astrologists at predicting the future.

That's not fair. Paul Krugman has predicted seven of the last three recessions.