Again, I would say that economists don't seem to make money for anyone consistently or for the countries and institutions which employ them. Even I knew it was a problem when banks started making loans to professional gamblers (a friend's son). Where were the Federal economists putting the brakes on such obvious problems? Busy talking about how it was different this time. I can probably find a story but it is late.
< I find it a bit strange that you measure the worth of the profession by the ability of its members to make money>
Look - It is though a physicist receives a Nobel Prize yet can't lead a team to build a reactor or particle accelerator. What good is such a detailed, and self-consistent knowledge of hypothetical worlds? I didn't mean to ruffle academic feathers (you may know some great economists) but "my economist can beat up your economist" battles are like watching boxing robots - fascinating but of limited use except as amusement. The numbers they all toss about are Herculean and beyond the ken of mortals.
I'd prefer we go back to basic accounting - most financially savvy people can understand that ROI, net costs, fair value, time value for assets, earned interest, balance of payments, inventory shrinkage, losses, windows of opportunity , etc. are all pretty good considerations for how a balance sheet balances for a country or a business. The country is just like a business but a lot bigger. Countries budgets should balance, if not make money. Ones consistently in the red are poorly run. Like AMD but bigger flops.
<You're not bothered by the Nobel prize for economics but by the profession itself.>
Certainly am - why not a Nobel prize for other social sciences that have similar merit? Because the prize (and the profession) are supposed to be about real insights that have made a fundamental change in the world, especially for people. Nobel was trying to assuage his guilt over the harm of high explosives by elevating humanity instead of killing them. That was the spirit of the prize. Economics was not on his list because bankers don't save anyone. Economists are the generals of the bankers and are at (sometimes literal) war with one another. They are strategists. Accountants in this military metaphor are the tactical squad. No general won a war without good tacticians. .
In 2008, we have the bank crisis of bank crises with major companies playing financial Ponzi. Further unaccounted bailouts of more TRILLIIONS occurs. At some point doesn't one wonder what the economist opinion is about all this missing thousands of billions of dollars and what it will do to our balances? Do we get a useful model for where it all went and who profited? No. Is there a call for immediate reconciliation? No.
<Buffett reads balance sheets constantly rather than working his way through macro or micro economic models. >
Of course he does. Look I know these economists work hard too. They study and simulate and are like the Greek philosophers. They are matchless wits - I just don't think that the constructions they produce are particularly useful to the rest of us. This is what I mean when I say "accountants are more useful for a (company, country) than economists". I want to know where the money went and see a case for its recovery. For this task, we need some forensic accounting, not more high stakes economic wizardry.
Hey, it has been great and intellectually exciting, but I've got to go. My posts will be feeble and infrequent going forward. I have to do some other things for a while - but I'll check in now and again. Bye for now. |
