Friday, Jul 18, 2008
Three scientists explain why markets crash
Money Week: Three scientists explain why markets crash
If you ever worry that you don’t know anything about how economics or finance really work, then the latest issue of New Scientist should reassure you somewhat. Because it shows that the experts know nothing either.
The magazine reports that some ‘econophysicists’ and other scientist-types think they’ve made some bold new discoveries about the financial markets.
Posted by housebear @ 12:09 PM (351 views) Add Comment
5 Comments
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1. mark said...
wonder if they can explain why it rains ? lol
2. letthemfall said...
Well, it's a bit of a cheap article this. Yes, modelling throws up obvious answers, but then if it didn't the model would be pretty useless. The question is what more subtle points comes out of the model. I don't imagine John Stepek paused to consider this, which shows it is probably best not to comment in too much detail about something you don't understand. Scientists are as capable of talking rubbish as the next man; doesn't mean to say the next man knows better.
3. last_days_of_disco said...
I think its great, he is calling a spade a spade.
These guys probably got a huge grant to do this research and are living a good life modeling obvious stuff.
It would be interesting if they could predict the dynamics. That is where the money is to be made. The problem is your model needs all kinds of information that is impossible to get to do that. Pity.
4. letthemfall said...
We know spades are spades. Some scientists get grants to do indifferent work; some get nothing at all to do good work. The majority are not well paid. Most people do unproductive work some of the time. Some do it most of the time. As for science, much work amounts to nothing. Some of it amounts to a lot. Often difficult to predict the result. Laughing at science is like laughing at the weather forecast.
5. Fjcruiser said...
Bubbles happen because of greed.And naturally bubbles burst.A few loose their shirts and the rest survives.It is called evolution.