Skip to main content

What are the biggest misconceptions people have about economics

They Think They Understand It
It’s a Friday night. You head down to your corner bar to grab a drink and unwind from a long week. Just as the liquid slips down your throat you over hear the conversation of the people next to you. What’re they talking about? Oh but politics and the economy of course! Everyone and their mother knows what’s wrong with it and how to fix it.
I can’t tell you how many times I run into people that speak with such confidence on matters of micro and macro economics without having the slightest clue what they’re talking about. Rambling on about this and that and how if they did it their way we’d all live in an utopian paradise. They’ve formed a solid opinion about a sliver of an economic problem and suddenly they’ve become a professor on the matter.
The stone cold truth is that most people don’t know what they’re talking about, even outside of just economics. It’s not politically correct to say so, but I’m not going to twist the truth cause it’s sour. From foreign policy, international affairs, economics, etc, a majority of people just don’t know what they’re talking about. Sometimes even financial professionals and academics, the people who get paid to ponder on economic theory & process, don’t understand it in it’s entirety. If they did we’d be able to prevent horrible economic downturns before they ravaged whole nations of their wealth. Economics, much like politics is an ever changing and fluid environment where what may have been true yesterday may not necessarily be true tomorrow.
In an interview with Men’s Journal, Tony Robbins, mentioned that when he interviewed Fed Chairman Alan Greenspan and asked him what he’d do if he were still chairman of the reserve, Greenspan replied he’d resign. If we put aside the belief some hold that Greenspan engineered the financial collapse of 2008, you have an accomplished economist who’s admitting to not having a clue how to remedy a situation and so would quit the job. Seems to be a pretty bleak and complex situation if such an experienced man is throwing his hat down. If this man isn’t sure what to do with his years of education & experience as an economist, then I’m not sure how any of us who have no frame of reference whatsoever, have the right to a fierce opinion.
Economics is hard, really hard. It’s hard to understand it for one nation. We live today in a global economy where goods, services and products flow freely between nations. Understanding the myriad of complex relationships, causalities, etc is extremely challenging even for the finest minds. Most people don’t have a clue what they’re talking about.

Comments

Post a Comment

Popular posts from this blog

Which countries are likely to be developed countries soon?

A lot of the answers have stated some of the Eastern European countries and I agree with them however another region that is soon going to have developed countries soon is Asia and Asia has some good candidates: The GDP Per Capita (PPP) benchmark to be counted as developed is in the $20–25,000 range and that is the bare minimum also the country’s HDI has to be higher than 0.800 with a diversified industrial composition. A total of 17 countries fit the bill however a closer look at their HDI or industrial composition would make it clear why they are not considered developed, a lot of them would be considered developed if they could fix these issues, most of this can be achieved within 10 years time, I will start by assessing each country on its major issue and how long it will take based on that: Qatar:  Over reliance on one industry,  time needed:  5 years Singapore:  Already developed Brunei:  Over reliance on one industry,  time needed: ...
Post a Comment
Read more

Can the Philippines become a developed country

keep growing its economy. get the Islamist insurgency under control and defeated. solve its traffic problem. The last is the hardest. I’ve the long term solution. First, why doesn’t Grab work everywhere? Remove the regulatory barriers. Second, while ride sharing helps, for a country of the density of the Philippines, mass transit rail is the only solution. However bringing mass transit rail directly to the cores of the cities like Manila is not practical. Instead, for now, take advantage of the growing population, and introduce mass transit rail with every development in the suburbs. Eventually there will be concentric rings of rail around each city, which will reduce the surface traffic in the cores because if it takes 50 times longer to move along the radius as as circumference, people will choose the circumference even if the distance is 6.28 times longer (circumference = 2 * radius * pi). Eventually people will abandon the cores, and this will be an opportunity for ...
Post a Comment
Read more

What does spending $20bn on the world's longest bridge say about the strength of China's economy

Some people ask questions about China and the Chinese, which shows a complete ignorance of the Questioner. The best question/s come from people who understand China/the Chinese length and breadth of the culture. For example, this man at the best could be 140 lbs and carrying this load to deliver to a restaurant in the Yellow Mountains. The Chinese Government easily could deliver it through Helicopters, but they do not want to kill the livelihood of hundreds of such porter. To the Western World, it may not make sense, but the Eastern Culture makes sense. On the other hand, this mountain man who is fit as the fiddle, loves his livelihood, his mountainous surrounding. He does not give two hoots to bright lights of Shanghai, he does not want to move(I am guessing), and the Government of China recognizes it, and that is why most to the Chinese do not give two hoots for useless democracy and fake freedom. And President Xi and his wife the first lady are the darlings of the masses. Th...
Post a Comment
Read more