Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: Jim Willie CB who wrote (20374)	10/20/2004 6:31:34 PM
From: Elroy Jetson	Respond to of 110194

That quote sounds very much like something from Simon Kuznets, who was awarded the Nobel Prize for Economics in 1971. Who wrote, "any economic analysis should use raw data, not adjusted data, since to do so is bound to introduce wrong conclusions... most adjusted data is distorted in some way" ? He started his career working in England at the NBER (National Bureau of Economic Research) and believed in the importance of developing empirical data on family expenditure, elasticity of demand and substitution. He created the methodology of assembling "national income accounts", or "national income product accounts" as some call it. Schumpeter was big on collecting and using empirical data as the basis for analysis, but I don't think that quote is from he. This is great stuff on Schumpeter in his own words: dallasfed.org If I can find out specifically where the quote is from, I'll let you know. It's certainly pertinent in our current world of fun-house mirror distorted statistics.

To: Jim Willie CB who wrote (20374)	10/20/2004 8:09:17 PM
From: Elroy Jetson	Read Replies (1) \| Respond to of 110194

Simon Kuznets quotes are not easy to come by without actually opening his books. But his most famous quote reflects a similar distrust of economic numbers. Kuznets (creator of the GNP - actually what we today call GDP after Keynes changed the definition of GNP) made this comment over many years and in different venues: “The welfare of a nation can scarcely be inferred from a measurement of national income as defined by the GDP. Goals for 'more' growth should specify growth of what and for what.” Some of his notable concepts were: 1.) Capital gains should not be included in the measures of the productive output of a nation as, "Capital gains and losses are not increments to, or drafts upon, the heap of goods produced by the economic system for consumption or for stock destined for future use, and hence they should be excluded."; 2.) Measures of production during a period of war have to be reviewed cautiously because much wartime output does not contribute to the consumption or welfare of an economy except in a fairly abstract way. Efforts, like a pointless war in Iraq, to hide an economic recession in statistical terms does not prevent the recession from actually occurring. As Ludwig von Mises said, "War prosperity is like the prosperity that an earthquake or a plague brings."