End of the world?

chrismac1

I absolutely love the end of the World! 1987, 1992, 1998, 2001, 2008 are the main years in the last 25 that the world has ended. Great stuff! I was buying shares in those years and I have not regretted it. I am very much a confirmed "End of the World" theorist - the End of the World follows a fairly predictable pattern each time the world ends and it includes a decent share buying opportunity!

Geoff23

chrismac1 wrote: »

I absolutely love the end of the World! 1987, 1992, 1998, 2001, 2008 are the main years in the last 25 that the world has ended. Great stuff!

I was buying shares in those years and I have not regretted it. I am very much a confirmed "End of the World" theorist - the End of the World follows a fairly predictable pattern each time the world ends and it includes a decent share buying opportunity!

Have you ever heard of Bertrand Russell's turkey? This was a clever turkey who had a flare for inductive reasoning. He believed that each time he observed that X followed Y, he could be more certain that every time Y happened, X would follow.

Every morning he observed the farmer's wife coming down the garden path at dawn, and this was followed each time by the turkey receiving his breakfast. It went on for months, and each time it happened, the clever turkey became more certain of his conclusion that farmer's wife coming down the path would be followed by his breakfast. Then one day the farmer's wife came down the path, took the turkey out of his pen and wrung his neck.

Look at what is actually happening around you. Carefully.

Aegis

Geoff23 wrote: »

Have you ever heard of Bertrand Russell's turkey? This was a clever turkey who had a flare for inductive reasoning. He believed that each time he observed that X followed Y, he could be more certain that every time Y happened, X would follow.

Every morning he observed the farmer's wife coming down the garden path at dawn, and this was followed each time by the turkey receiving his breakfast. It went on for months, and each time it happened, the clever turkey became more certain of his conclusion that farmer's wife coming down the path would be followed by his breakfast. Then one day the farmer's wife came down the path, took the turkey out of his pen and wrung his neck.

Look at what is actually happening around you. Carefully.

I'm assuming this example is one from a philosophy primer, intended to detail the difference between empiricism and rationalism. If you're going to talk about that, it might be worth bringing up the idea that sunrise is determined by empirical observation of how our planet moves around the sun, therefore should be subject to suspicion. At the extreme conclusion, one would expect a follower of pure rationalism to be surprised every time the sun rose.

Regardless, you can't easily apply rationalism to this sort of problem, as the outcome simply cannot be reasoned out from axioms. The markets are ultimately too chaotic for that, therefore empiricism is really all that's left to us when it comes to this sort of analysis.

For the record, everything we know in science has been determined through inductive reasoning.

Geoff23

Hi Aegis,

Aegis wrote: »

I'm assuming this example is one from a philosophy primer, intended to detail the difference between empiricism and rationalism.

Russell's turkey story was created as an attempt to refute inductivism in philosophy of science. He was pointing out the inherent weakness of inductive reasoning (from "The Problems of Philosophy", Chapter IV.) The point is that if something is observed to happen over and over again, it only means that it probably will happen again the next time, but this is not proof that it will for certain.

If you're going to talk about that, it might be worth bringing up the idea that sunrise is determined by empirical observation of how our planet moves around the sun, therefore should be subject to suspicion. At the extreme conclusion, one would expect a follower of pure rationalism to be surprised every time the sun rose.

That depends on what alternative view you take about philosophy of science. This isn't really about the rationalism/empiricism debate, which (IMO) had been pretty much nailed by Kant over hundred years earlier. It's about the nature of science and scientific knowledge.

Being aware of the dangers of inductive reasoning is enough. You don't have to abandon it completely, just be on your guard for exception which breaks the rule - the white raven, the black swan.

Regardless, you can't easily apply rationalism to this sort of problem, as the outcome simply cannot be reasoned out from axioms. The markets are ultimately too chaotic for that, therefore empiricism is really all that's left to us when it comes to this sort of analysis.

My own views about economics are driven by an attempt at holistic reasoning. I'm viewing economics within a bigger picture of ecology, political reality, history, human psychology, etc... In my experience, most economists are too busy thinking inside the economic box they were trained to think inside and don't have a very firm grasp of the bigger picture. That's partly how we ended up in such a mess.

For the record, everything we know in science has been determined through inductive reasoning.

That is true, but we have to be very careful about what we mean when say something like "scientific knowledge."

For the record, my own position on scientific knowledge is quite close to Bas Van Frassen's Constructive Empiricism and my epistemology derives from Kant.

Geoff

Geoff23

It probably should also be pointed out that inductive reasoning tells me that fiat currencies tend to collapse about 40 years after they are introduced, and that the mode of collapse is terminal devaluation.

Ark_Welder

Geoff23 wrote: »

It probably should also be pointed out that inductive reasoning tells me that fiat currencies tend to collapse about 40 years after they are introduced, and that the mode of collapse is terminal devaluation.

Terminal implies end

http://en.wikipedia.org/wiki/Pound_sterling#History

Aegis

Geoff23 wrote: »

It probably should also be pointed out that inductive reasoning tells me that fiat currencies tend to collapse about 40 years after they are introduced, and that the mode of collapse is terminal devaluation.

True, though anyone using induction correctly would have to take account of differing circumstances surrounding the events rather than simply applying them blindly. Science acknowledges this as an issue by stating that any discovered laws are a) tentative and b) only valid in circumstances where they have previously been observed to be valid.

I'd argue that circumstances, while different, aren't different enough for everything to go more horribly wrong than we've previously seen in this case.

Interesting philosophical discussion, by the way, very much enjoyed that!

Geoff23

Ark_Welder wrote: »

Terminal implies end

http://en.wikipedia.org/wiki/Pound_sterling#History

For the fiat currencies in question, it was the end.

When the Weimar German Mark collapsed, it was the end. Germany continued to use the Mark after that, but it was a different Mark.

Geoff23

Aegis wrote: »

True, though anyone using induction correctly would have to take account of differing circumstances surrounding the events rather than simply applying them blindly. Science acknowledges this as an issue by stating that any discovered laws are a) tentative and b) only valid in circumstances where they have previously been observed to be valid.

Agreed, and I believe that it factors external to economics-as-we-know it which have fundamentally changed. Peak Oil hasn't been true before, and that's just one of many differences.

I'd argue that circumstances, while different, aren't different enough for everything to go more horribly wrong than we've previously seen in this case.

Time will tell.

Interesting philosophical discussion, by the way, very much enjoyed that!

You're welcome.

Ark_Welder

Geoff23 wrote: »

For the fiat currencies in question, it was the end.

When the Weimar German Mark collapsed, it was the end. Germany continued to use the Mark after that, but it was a different Mark.

Ah yes. The W.R. and Zimbabwe are frequently mentioned as examples of what happens to fiat currency [edit] systems that resort to the printing press.

Well. Have you ever heard of Bertrand Russell's turkey...?