Alex Soojung-Kim Pang, Ph.D.

I study people, technology, and the worlds they make

The Queen’s economics lesson

From The Guardian:

A group of eminent economists has written to the Queen explaining why no one foresaw the timing, extent and severity of the recession.

The three-page missive… was sent after the Queen asked, during a visit to the London School of Economics, why no one had predicted the credit crunch.

What did they come up with? The explain that

the failure to foresee the timing, extent and severity of the crisis and to head it off, while it had many causes, was principally a failure of the collective imagination of many bright people, both in this country and internationally, to understand the risks to the system as a whole.

Sounds perfectly plausible. The question is, what would help improve that collective imagination?

1 Comment

  1. In what way is that explanation “perfectly plausible”? More plausible are the following: 1) The people with those “collective imaginations” are either not so bright or have their own agendas 2) There was an absolute refusal to pay any attention to the dozens of ACTUALLY bright individuals who did in fact predict these problems, and for several years ahead of time 3) In the US especially, the government is now really being run (and has been for 20 years) by ex-bankers and wall streeters who have more loyalty to the organizations (i.e. Goldman Sachs) who have and will continue to make them wealthy, than to mainstream America. 4) The complete disappearance of independent journalism from the mainstream media who are more intested in political correctness and pandering to their favorite pols in return for their own big $$$. It continues with the current predictions that the recession is over. . . Huh? So we solved a debt bubble by going deeper in debt? No – we’ve simply started creating another, which won’t manifest itself for a few more months, but will explode much sooner than the last one, and much much worse. Or maybe I’m just not bright and have too much imagination. . . BTW, what is “eminent” about economists that failed to predict this obvious disaster? I would change to label to “incompetent” . . . .

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