The U.S. Goverment

[ArvinJA]

Testing implies that there is a theory to be tested. Facts cannot be interpreted at all without some sort of theory or hypothesis.

It's not a theory till it's been tested, just a hypothesis. And I wouldn't stake the well-being of the nation on a mere hypothesis

You are confusing chemistry with economics.

[Potjeh]

It's still a science, or at least pretends to be. The point still stands, you don't use a sledgehammer for surgery. Such sweeping solutions are only applicable to economics when you're making great leaps forward

[ArvinJA]

But noone ever tried to model the market in its entirety. Except the communists. Which is why communism failed. The welfare state tries to do it in part, and fails just as spectacularly. Only because it leaves part of the market to the individual does it not fail as quickly as communism.

The whole point of classical and Austrian economics is precisely that that is impossible, and therefore also, by extension, that central planning is impossible, which is the reason why planning should be left to the individual.

Of course, the fact that the market in its entirety cannot be modeled does not entail that specific phenomena, such as the "trade cycle", certain factors in price determination, and the often misinterpreted "invisible hand", cannot.

Creating laws is a way to build a model. Invisible hand for instance, is a theory and not a phenomenon. It's actually quite criticized as it doesn't effectively model the behaviour of markets. While it may be validated in some instances, it still needs to be generalized to be used effectively.
My problem with some followers of praxeology is that they build theories following logic, and -because it's using logic and makes sense-, they think that their theories does not need empirical validation.

The auction theory is a branch of theory of games, and it is quite interesting.
My ebay example tried to show how logical theories failed at modeling real facts. The theory is still interesting (it is actually quite useful, for other purposes). However, it's prerequisites are not met because most ebayers are not rational. Therefore, people have to develop new theories.
So why am I talking about it ? Simply to show how logical theories does not necessarily correctly model reality, and how the classic case studies are still effective to find new theories there. I think this is a pretty legit example of how praxeology shouldn't be as iconized as (apparently) Jorb does and how it fails miserably when you skip the empirical validation.

Another interesting thing in this example is that it breaks the myth of rational economic actors. This and the refusal of most economic libertarians to acknowledge externalities are in my opinion the most problematic points of liberal market theories.

Your safety practices in your straw man factory seem way off. Be sure to not hurt yourself in your confusion.

Stop referring to "the invisible hand", Adam Smith wasn't a marginalist and so obviously many of his conclusions were wrong, also, he was not a praxeologist, praxeology didn't even exist during his time. What the libertarians in this thread have been talking about is Austrian Economics (Mises, Böhm-Bawerk, Menger, Rothbard, Krizner and Hayek) which indeed builds upon the knowledge of Classical Economists (like Say, Ricardo and Smith). It is clear however that you are not familiar with Austrian Economics nor the framework it relies upon, and it would be foolish of you to continue to argue against without even knowing your Austrian Econ 101.

[MagicManICT]

:| im getting lost here. could go nitpicking, but may need some new baits

http://online.wsj.com/article/SB1000142 ... 24854.html

I'll bite.

I'll also try to keep it short.

The world needs to quit giving legitimacy to these "freaks of society." How many times has it been proven over and over again, even with recent history only, that these sorts have only their own self interests in mind and control of the population and political and military power?

edit: I'm getting tired of the economics discussion myself.

Also: It doesn't matter what your studying, if you're using logic, the scientific method pretty much still applies. Also, a hypothesis is, by definition, an analysis of the facts at hand. This is why hypotheses are constantly re-evaluated after every series of tests to prove or disprove. As Potjeh said, you only have a theory after extensive testing and reanalyzing all the data and facts. Even then, it's just a theory. It could be wrong.

[pyrale]

Stop referring to "the invisible hand", Adam Smith wasn't a marginalist and so obviously many of his conclusions were wrong, also, he was not a praxeologist, praxeology didn't even exist during his time.

I never stated anything about what Adam Smith was or was not. If you don't understand why I talked about him here, I suggest you re-read me again.

What the libertarians in this thread have been talking about is Austrian Economics (Mises, Böhm-Bawerk, Menger, Rothbard, Krizner and Hayek) which indeed builds upon the knowledge of Classical Economists (like Say, Ricardo and Smith). It is clear however that you are not familiar with Austrian Economics nor the framework it relies upon, and it would be foolish of you to continue to argue against without even knowing your Austrian Econ 101.

Yeah, and we also talked about how great monarchy was, and also a bit about how great it was to get the short hand of the stick during the colonial era. Don't try to hijack the discussion and tell us what we should talk about, and what we shouldn't.

[ArvinJA]

Yeah, and we also talked about how great monarchy was, and also a bit about how great it was to get the short hand of the stick during the colonial era. Don't try to hijack the discussion and tell us what we should talk about, and what we shouldn't.

I give up.

[Tonkyhonk]

It is clear however that you are not familiar with Austrian Economics nor the framework it relies upon, and it would be foolish of you to continue to argue against without even knowing your Austrian Econ 101.

uh huh, yeah, austrian school. i now see why out of blue you said this ↓ before.

Japan was stagnating before as a result of inflationism.

im not to criticeze austrian economics or anything, ive got almost no knowledge on economics.
but i can tell you this, dont try to explain everything only from what you learned

the old day economic calculation problem can be argued again here in relation with "pricing" on H&H though, since many villages try to use communisum or socialist economic systems
but it still would be a bit too off topic, considering this thread title, "the U.S. Government".

------------------------------------

MagicManICT,

i know what you mean
it is still quite interesting to see what "the Elders" can bring about from their "private" visit in Pyongyang, if anything new they have planned, without any official messages by Obama government.
(or have they even planned anything in particular?)
North Korea seems to be having trouble succeeding its leadership to whomever Kim Jong-il wants (is it Jong-un? i forgot), and would not like to have any troubles till its all done. of course they must have been desperate for this.
according to the news here, South Korean media says they are expecting North Korea to claim prohibition of nuclear weapons and to make some apologies on recent incidents happened in Korea, but its ... pretty questionable. or should i call it a bit too optimistic.
ive been wondering if the US government actually means to make this just another "regular meeting" as the past, or trying something different this time by taking certain people like former leaders of north europe with them.

[jorb]

I think I'm going to throw in the towel as well. Gold and silver prices are soaring, unemployment remains static despite massive injections of phony money ($600 billion from QE2 alone), signaling that even low end investors are avoiding inflation fueled investments due to regime uncertainty. The ways out are price and wage controls or hyperinflation, and neither is really a way out. They might be able to pull some stunts to keep the whole thing ticking for a few more years -- it's impossible to predict -- but my guess is that it doesn't take much more than the drop of a hat to pull the plug on this massive ponzi scheme at this point. There are at least $600 billion worth of bubbles in the economy at this point, and they will burst.

I hope to God that I am wrong, because I fear that if I am right things will turn very, very ugly.

Nice talking to y'all. I actually enjoyed it.

[Tonkyhonk]

it's impossible to predict -- but my guess is that it doesn't take much more than the drop of a hat to pull the plug on this massive ponzi scheme at this point. There are at least $600 billion worth of bubbles in the economy at this point, and they will burst.

this is just a mumbling from "what is economics?" noob, but is an accurate "prediction" so important compared to its recognition?
bubbles if recognized so are all to burst. all bubbles recognized did burst. why not let them burst?
as long as you know its bursting, "when" is not so important, but "how to deal with it" seems more important for average people to me. (the sooner, the less damage, and the longer, the more planning time, no?)

just ignore the above, its probably too kiddy, but had to say it once


oh, and thanks jorb and loftar, it is really interesting to hear of your views. come back later!
*edit* also, sorry for throwing in a seemingly wrong bait

[pyrale]

I think I'm going to throw in the towel as well. Gold and silver prices are soaring, unemployment remains static despite massive injections of phony money ($600 billion from QE2 alone), signaling that even low end investors are avoiding inflation fueled investments due to regime uncertainty. The ways out are price and wage controls or hyperinflation, and neither is really a way out. They might be able to pull some stunts to keep the whole thing ticking for a few more years -- it's impossible to predict -- but my guess is that it doesn't take much more than the drop of a hat to pull the plug on this massive ponzi scheme at this point. There are at least $600 billion worth of bubbles in the economy at this point, and they will burst.

It's funny to see how disagreeing on the causes of the crisis agreeing on the consequences of it and how poorly it was handled by central banks ^^.

this is just a mumbling from "what is economics?" noob, but is an accurate "prediction" so important compared to its recognition?
bubbles if recognized so are all to burst. all bubbles recognized did burst. why not let them burst?

It is not really important to predict when exactly it will burst. However, you usually want to defuse it as much as possible and prepare for the crisis (and imo, governments are massively failing at this). You don't want to just let a bubble burst without taking any action, because of how severe their impact is on the economy.