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Ask HN: How can I learn macroeconomics properly?

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Re: Ask HN: How can I learn macroeconomics properly?

#121

Post by huitzitziltzin »

avvt4avaw wrote: post #74

I'm a professional investor (more than a decade of experience at hedge funds, particularly in global macro and quant, managing my own and other people's money). Your central premise is flawed -- in particular > Last 3 years has shown that to be a good investor you need to know macroeconomics This is not true. It is true that 'macro' events (central bank actions, supply/demand shocks, wars, pandemics) affect prices, b…

I’m an economics professor (not in macro, but I’ve taken more macro and at a higher level than you have).

I think this comment is right on the money. None of what I learned in graduate school would help you forecast the price of a specific asset.

Some of the large investment firms do employ economics PhDs to help them make forecasts of particular broad macro variables (inflation, unemployment, etc.). I don’t know of anyone who uses their macro background to forecast specific asset prices (e.g., Amazon’s share price).

(Note that there are people in economics who study time series forecasting - that can be used to make forecasts for specific assets but is considered somewhat separate from most macro modeling, which is micro founded and done in a DSGE framework.)

I’d recommend you study macro bc it is interesting and intellectually rewarding, but I don’t think it’s going to tell you anything about pricing a specific asset.

Re: Ask HN: How can I learn macroeconomics properly?

#122

Post by loxias »

countvonbalzac wrote: post #105
avvt4avaw wrote: post #74

I'm a professional investor (more than a decade of experience at hedge funds, particularly in global macro and quant, managing my own and other people's money). Your central premise is flawed -- in particular > Last 3 years has shown that to be a good investor you need to know macroeconomics This is not true. It is true that 'macro' events (central bank actions, supply/demand shocks, wars, pandemics) affect prices, b…

Do you have any recommendations for tax efficient wrappers?

Buy SPY, put it in your IRA. Maybe a SPY/TLT mix. For bonus income, sell monthly covered calls against SPY as well.

Re: Ask HN: How can I learn macroeconomics properly?

#123

Post by avvt4avaw »

nickff wrote: post #120
topaztee wrote: post #119

Earlier quoted context omitted.

can you expand on this? `Simply buy a diversified set of investments in a tax-efficient wrapper for a total cost of < 10 basis points annually,`

I believe the parent is suggesting that people buy broad-market exchange-traded funds (ETFs) in whatever type of account is most tax-efficient.

Yes.

Re: Ask HN: How can I learn macroeconomics properly?

#124

Post by avvt4avaw »

hnxs wrote: post #116
avvt4avaw wrote: post #106

Earlier quoted context omitted.

No. Invest everything that you can now (into low cost diversified index funds or ETFs) and then top it up regularly as you get more capital from whatever else it is you do to earn a living (e.g. a percentage of your salary every month, a percentage of your annual bonus, a percentage of the annual dividend from your business etc etc).

Do you have any recs? I currently use VTWAX, VTIAX, and VTSAX as my index funds. Even split between all three. I would appreciate any recommendations on what to change in terms of allocation.

They are all very good choices.

Re: Ask HN: How can I learn macroeconomics properly?

#125

Post by SantalBlush »

stevenhuang wrote: post #84
SantalBlush wrote: post #83

Earlier quoted context omitted.

Most of what you've described here is about politics and finance, not economics. Econ has pretty much nothing to do with sitting on a board or high-frequency trading. HN is full of users who don't know what econ is but want to explain how wrong it is to one another. It's like a parody of itself.

But taking "economics" in isolation like this ignores much of what actually happens in reality (the politics part). It's a large part of why economics as a field is made fun of when its models are too simplistic to accurately describe reality.

You're just piling one non-sequitur on top of another. The question on this thread is "How can I learn macroeconomics properly?" The comment to which I replied was an uninformed diatribe that doesn't even come close to answering the question. Now you're doubling down on it.

When someone is asking how to learn economics, it would be helpful to take it more "in isolation" instead of regurgitating the same complaints that we see on HN and don't even answer the question.

Re: Ask HN: How can I learn macroeconomics properly?

#126

Post by jah242 »

bwanab wrote: post #103

John Maynard Keynes was arguably the greatest macroeconomic mind of all time, but after losing a lot of money, he came to the conclusion that one should invest in companies that 1) make products you understand and 2) have management that you trust. If that sounds familiar, it should since that is Warren Buffet’s strategy who has been known to quote Keynes often.

I second this and can't recommend Keynes and his writing highly enough.

I would also add that if you can get hold of Volume 12 of The Collected Writings of John Maynard Keynes it goes through his time as an investor and all related correspondence in great detail. Fascinating from a historical and practical perspective.

Re: Ask HN: How can I learn macroeconomics properly?

#127

Post by RockyMcNuts »

dr-neptune wrote: post #57
RockyMcNuts wrote: post #56

There are many different types of models used for different purposes. https://www.piie.com/blogs/realtime-economic-issues-watch/ne... https://mainlymacro.blogspot.com/2013/12/microfoundations-il... the models people use to explain/illustrate are more toy models, micro-founded DSGE models, for forecasting typically people tend to use empirical models. One approach would be to do a college intro to macro textbook or MO…

Rob Hyndmans book is a great quick intro: https://otexts.com/fpp3/ If you want to jump in the deep end (aka you know good chunk of mathematics), you could skim Hamilton's Time Series Analysis A good way to learn is to do a bunch of time series analysis, kaggle has some

thanks!

Re: Ask HN: How can I learn macroeconomics properly?

#128

Post by testkitchen »

avvt4avaw wrote: post #74

I'm a professional investor (more than a decade of experience at hedge funds, particularly in global macro and quant, managing my own and other people's money). Your central premise is flawed -- in particular > Last 3 years has shown that to be a good investor you need to know macroeconomics This is not true. It is true that 'macro' events (central bank actions, supply/demand shocks, wars, pandemics) affect prices, b…

If you are interested in investing in government bonds, macroeconomic forecasting could be quite important, but overall, it doesn't help you much for stock return predictions. In fact, very few variables (macroeconomic indicators included) show robust power to predict market returns.

Re: Ask HN: How can I learn macroeconomics properly?

#129

Post by amelius »

Mikeb85 wrote: post #75
amelius wrote: post #23

Isn't macroeconomics a good candidate field for being disrupted by deep-learning algorithms?

You're so, so far behind it's not even funny. Economists have been using statistics, programming, deep learning, etc... for a while now.

I know... the question is: when does the DL take over entirely?

Re: Ask HN: How can I learn macroeconomics properly?

#130

Post by Mikeb85 »

amelius wrote: post #129
Mikeb85 wrote: post #75

Earlier quoted context omitted.

You're so, so far behind it's not even funny. Economists have been using statistics, programming, deep learning, etc... for a while now.

I know... the question is: when does the DL take over entirely?

When it's general purpose AI?

I mean, economics in industry is already basically all ML... On the academic side there's a bunch of disciplines and rightfully so.

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