Monday, August 8, 2011

Interfluid Ditty

Out of context, from Who are this ‘we’ of which you speak, Tyler Cowen?
Fisher Black, as Cowen has interpreted him, suggests that since investors’ views over the short-term are not independent of one another, patterns of aggregate investment can be systematically mistaken for a while in ways that seem surprisingly obvious in retrospect.

Yeah, recently I wrote this:

Keynes said, "It is astonishing what foolish things one can temporarily believe if one thinks too long alone." It is true, to be sure. But it is equally true that one may think foolish things because one thinks too much in the company of others, and the meme spreads like measles, spreads like the plague.

Patterns of economic analysis, systematically mistaken.

The Lucas mistake, surprisingly obvious in retrospect.


Jazzbumpa said...

Great Title.

Good post, too.

I read through Waldman's post, and a bit of it is over my head.

The Galbraith quote, interestingly, is pure Elliot Wave.

I think Waldman is polite and understating his case.

Cowan is a tool, just like Roberts.


The Arthurian said...


Waldman's paragraphs are longer than my attention span.

Did you ever do a post on the Elliot Wave? You refer to it a lot. I've seen it advertised, but when I look, it seems too involved to grasp quickly. The short-attention-span thing again, I guess.

The way you mark up graphs with "channels" is Elliot-style, yes?

Calgacus said...

The central problem of depression-prevention has been solved. Oh, it was - a long time ago. Lucas & Co were just hard at work destroying such knowledge.