Finance: Whip of Time

i think u might have got trolled lol

sick rant tho

What is your statistical background btw?

meh

Just reading stuff. The argument is the point here.

I'm also not saying "statistical methods" are always 100% useless in every form and in every economic application. They are just another tool, one of many.

Oh is that the point here? No worries.

"If not, make fun of them until you become too jaded for such small pleasures."

http://en.wikipedia.org/wiki/Econometrics

The present and future of economic modeling. In an academic setting, all research that doesn't have an econometric approach to the research, is pretty much useless and of no interest. Except if you are part of the Austrian School of thought.

I am most interested in developing a deep understanding of the economy, how the phenomena happens, and its real-world effects.

Does econometrics have anything to do with those things? Or do academic settings not measure the expectations of their theories against actual results? Are you aware of the logical weakness of inference and how it can be deceiving ( http://en.wikipedia.org/wiki/Inference )?

I'm not sure you are. I found this paper (which is a long first segment of an even longer paper) and the main discussion of the problems with empiricism in social sciences (economics..) that begins a few paragraphs in outlines what I'm trying to explain. If you don't recognize the argument, I believe its most potently and thoroughly explained on www.fooledbyrandomness.com



BTW why do you mention an academic setting when I'm talking about trying to operate in the real world where results matter?

Anyway, that's enough econometrics..

btw if you guys want to spew play money optionsxpress.com has a full featured virtual trading mode

obv who cares about statistics when you can pick apple crashes

What are you trying to operate exactly? im not going to say i'm an expert, but your just arguing against statistical theories used to make economic models?

I am most interested in developing a deep understanding of the economy

well if you know the basics of your micro and macro theory, then next step is statistical theory and econometrics in general. The only flaws i see is that people expect probabilities and it's models to manifest itself in the real world, validating the models. Which i think is a logical fallacy.
IMO im still a newb in this field, but my simplest comparison is predicting weather. Our understanding and modeling of weather patterns has improved tenfolds, nonetheless the "big" disasters do happen, and are almost unpredictable. So we use these models mostly to prevent, in case.

Anyways, it's not perfect and it has it's flaws and it's critiques (Statistical use in general IMO)
http://en.wikipedia.org/wiki/Criticisms_of_econometrics

Mainstream economists are generally critical of methodologies used by modern Austrians and argue that conclusions reached by pure logical deduction are limited and weak.[14]

Which is more or less the direction you are taking, i'm assuming here.

Obviously I'm a fan of Austrians but I'm not at the degree of fanboy that I can't take critique. And I have no idea about what econometrics is except by reading the wiki-link, but isn't at least a lot of it a case of "Correlation does not equal causality".

Like that first part, Okun's law, which sees a correlation between GDP growth and employment (or rather, unemployment). It would seem that a Austrian would kick that theory's ass assuming somewhat reasonable information about a case since there's no causality in Okun's law.

It's like the difference between a "monkey see, monkey do" approach to poker compared to actually understanding the game.

I'm really biased towards liking statistics and such but this just seems like something politicians will use to (miss)apply when the try to convince people that what they do actually is not as retarded that it would seem. It obviously has it uses but I think it'll overall be something that destroys more then creates.

Take for example Okun's Law, that will be just another way to argue that they need to spend more money they don't have to create jobs which produces crap no one wants to pay for as a way to get the economy going when what is really needed is for people and governments to live within their means.

I think it would just be easier to focus on what the market makers are doing. They are the dealer and button every hand; they collect rake!

On December 14 2012 06:40 DustySwedeDude wrote: Obviously I'm a fan of Austrians but I'm not at the degree of fanboy that I can't take critique. And I have no idea about what econometrics is except by reading the wiki-link, but isn't at least a lot of it a case of "Correlation does not equal causality". Like that first part, Okun's law, which sees a correlation between GDP growth and employment (or rather, unemployment). It would seem that a Austrian would kick that theory's ass assuming somewhat reasonable information about a case since there's no causality in Okun's law. It's like the difference between a "monkey see, monkey do" approach to poker compared to actually understanding the game. I'm really biased towards liking statistics and such but this just seems like something politicians will use to (miss)apply when the try to convince people that what they do actually is not as retarded that it would seem. It obviously has it uses but I think it'll overall be something that destroys more then creates. Take for example Okun's Law, that will be just another way to argue that they need to spend more money they don't have to create jobs which produces crap no one wants to pay for as a way to get the economy going when what is really needed is for people and governments to live within their means.

Funny you focus on Okun's law; it's only used as an example of linear regression, not that the law actually has anything to do with econometrics.

Politicians will misapply whatever helps them, they are opportunists like many others, but that's a completely illogical way of looking at the validity and usefulness of different disciplines and tools/methods etc. "Correlation does not imply causation"

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