Central Banks Have Consistently Failed At Predicting Inflation and Growth, Why Believe Them Now?
When I took microeconomics in college, I was impressed at how all the charts and graphs were supposed to show our economic situation. The entire course was based on Milton Friedman's theories. After the course ended and I memorized everything needed for the exam, I couldn't accept the idea that mass human behavior could be predicted by mathematics. Even Greenspan was unrepentant by the disaster he caused. While he accepted responsibility, he said that his fault was not including something in an algorithm. Consider the difficulty of predicting the actions of a single person! Psychiatrists have admitted its impossibility. The search for a motive in the recent Las Vegas catastrophe is a perfect example. As Montaigne wrote long ago, we are so inflated with pride and presumption, that we imagine we understand the cause ofeverything. He goes on to say: "Truly man is a marvelously vain, diverse, and undulating object. It is hard to found any constant and uniform judgment on him."