Economic Quackery

Economic quackery.


Economics has allowed economists to turn into the modern day prophets. However, Economists have gone unchallenged for years and have led us to the current bubble and bust cycles. The blindness of economic theory should label economists as for profits rather than as prophets. Mind you, the profit moniker is not because they are serving the greater public good either.

The power of media and the allure to self indulge has led to widely held views that economists are smarter than the rest of the population. For whatever reasons, I do not know but many theorists, model pumping economists remind me more of the likes of Freud and the Freudians who were so wrapped up in their hypothesis that they would not deviate to a different position regardless of the evidence.

We would be better served by a new branch of economics called “common sense economics bases on real world observation”. As it stands now economic theory is light years away from reality and the allegiance to the power brokers has led economics astray.

Academia is great for classrooms but it serves little purpose in predicting or monitoring real world economics. The current recession is “perfect” evidence to the contrary.

How could a Nobel Prize winning economist believe that the ridiculous bubble in oil prices during 2008 was due to supply and demand? It was only possible through the application of text book theory that had nothing to do with the real world. The data led the likes of Paul Krugman and many others to claim there was no abundance of supply and that for some reason the summer of 2008 oil supply had evaporated in a few short months. (reference from Econned: How unenlightened self interest corrupted capitalism, locations 729-35, 735-40,740-45) The book is written by Yves Smith founder of the web site Naked Capitalism .

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