Rethinking economics is starting now, in Britain

Cornucopia

Not really. There is only one economic theory - the capitalist one. There are various flavours of socio-economic policy that can sit above that, but the underlying mechanics are pretty consistently understood.

Linton

Walcott wrote: »

I read economics at university. I then also completed a post graduate degree in economics.

I thought I was taught quite well. I strongly disagreed with the notion that economists completely missed the coming 2008. Whether they predicted it would be 2007 or 2006 or 2009 or 2010 is irrelevant. Any economist will tell you that the economy is cyclical. It was Gordon that said boom and bust had gone, not economists. Economists warned again and again that financial engineering had reached heights where nobody knew what was being traded anymore. The government ignored this.

Saying the economy has cycles isnt very helpful if you cant predict the size and timing. It provides no guidance as to the appropriate actions. Equally, saying that you dont understand the complexity of the financial engineering isnt helpful unless you can show its a problem and provide a cure with a costed justification.

What I believe economists and everybody else really missed, the real game changer, was the global interdependence of the financial institutions. Something that has only become a major factor in perhaps the last 20 years with high speed communications.

System

Linton wrote: »

Saying the economy has cycles isnt very helpful if you cant predict the size and timing. It provides no guidance as to the appropriate actions. Equally, saying that you dont understand the complexity of the financial engineering isnt helpful unless you can show its a problem and provide a cure with a costed justification.

What I believe economists and everybody else really missed, the real game changer, was the global interdependence of the financial institutions. Something that has only become a major factor in perhaps the last 20 years with high speed communications.

What?

Economists warned financial engineering had become too complex and you think that isn't useful? What problem do you want them to show? Stating that it has become complex beyond the understanding of it's users is the problem!

I honestly think you do not understand economics or misunderstand what is going on in economics if you think an economist did not know what was going on in global financial institutions over the last 20 years!

CLAPTON

Walcott wrote: »

What?

Economists warned financial engineering had become too complex and you think that isn't useful? What problem do you want them to show? Stating that it has become complex beyond the understanding of it's users is the problem!

I honestly think you do not understand economics or misunderstand what is going on in economics if you think an economist did not know what was going on in global financial institutions over the last 20 years!

Maybe so; just as we have economists saying there is some evidence that there may in the future be some exuberance with HTB.

Did they unambiguously tell their employers that they ought to get out of the complicated derivatives etc?

I'm just looking at a first year Uni economists text book that deals with banking and capital ratios etc. (published in the early 2000s)
He does indeed discuss some concerns about the changes in banking but it was not a 'call for action' more 'we must monitor closely'.

However, I'm not really critising economists as such, as it's very hard to go against the consensus.

System

CLAPTON wrote: »

Maybe so; just as we have economists saying there is some evidence that there may in the future be some exuberance with HTB.

Did they unambiguously tell their employers that they ought to get out of the complicated derivatives etc?

I'm just looking at a first year Uni economists text book that deals with banking and capital ratios etc. (published in the early 2000s)
He does indeed discuss some concerns about the changes in banking but it was not a 'call for action' more 'we must monitor closely'.

However, I'm not really critising economists as such, as it's very hard to go against the consensus.

Again, and sorry, but what exactly is it that you think an economist does?

I thought this topic was regarding Macro Economics? You are asking if they told their employers to pull out of derivatives. I don't understand that. Why would an economist tell a trader what to do? Why would a trader be an economist's employer?

Seeing as economists are not policy setters, I would have thought 'monitor closely' is exactly what they would do.

PS: Any self respecting economist would not use the word 'may' when describing the effects of HTB. The conclusion of that scheme is only going to go one way and it won't be good for the majority of the people that used the scheme!

antrobus

Linton wrote: »

Saying the economy has cycles isnt very helpful if you cant predict the size and timing. ...

That's like saying that medicine isn't "very helpful" because it can't predict exactly when and how you will die.

Thrugelmir

Linton wrote: »

id a Chem Eng degree at great public expense in the '60s which we never used. Were those degrees in practice any more worthy than one in PPE, history (OK I will give you religion) or even African Studies? Actually I would suggest rather less worthy being so narrowly focused.

Chairman of RBS at the time of its collapse was a chemist. No need to know anything about banking.

grizzly1911

Thrugelmir wrote: »

Chairman of RBS at the time of its collapse was a chemist. No need to know anything about banking.

In some of the original banks it needed little more than being family.

vivatifosi

grizzly1911 wrote: »

Whilst an MBA is a personal distinction and in your case well earned and deserved, no doubt, it is a shame that education inflation seems to make them the "new degree".

MBAs are very much Marmite degrees. There are people who want to recruit you because you have one, and others who wouldn't touch your application with a bargepole because you are an MBA clone. It is very much a double-edged sword. I find the breadth of subjects that I learned more useful than the qualification. I've never met a single student who was brilliant at every subject, the spread is so broad and the workload is at times brutal.

I'm glad I did it, but my focus in life has changed so much since that I probably wouldn't put myself through that again now as my priorities are different. Plus the fees will probably have at least doubled if not quadrupled since.

I think that they are worthwhile, but not the be all and end all. Much the same as I think about economics and politics degrees.

John_Pierpoint

grizzly1911 wrote: »

For many roles is there a need to complete a degree at all? Yes it is a tick in the box.

As someone said on BBC R4 said at lunch time today - If you in HR put forward a candidate qualified by experience, and they turn out to be carp at the job, your neck is on the line.
A bit like the old saying that nobody ever got the sack for specifying IBM

grizzly1911 wrote: »

In some of the original banks it needed little more than being family.

...........or having been raised on a council estate in Watford.?