Tag Archives: uncertainty

The coronavirus news flow is getting worse, and generating corresponding news flow. I just want to make a couple comments that stick close to my limited expertise. From a markets standpoint, the market that matters is the credit market, and not equities. I am not plugged into the credit market news flow, but I do not see anything that indicates that anything is irreversibly broken. Otherwise, the situation underlines the big difference between randomness and uncertainty. This is a geeky...

How does uncertainty affect the economy? The authors of an Economic Synopses essay examined this question, and their findings support the view that firms and households delay spending when uncertainty increases. The essay was written by Laura E. Jackson, an assistant professor at Bentley University; Kevin L. Kliesen, a business economist and research officer at the St. Louis Fed; and Michael T. Owyang, an economist and assistant vice president at the St. Louis Fed.... As Keynes said.FRBSL...

Radical uncertainty is feature of a complex adaptive system a chief characteristic of which is emergence. Emergence is at the heart of evolution theory. Emergence in this context means that there is no way to predict what will emerge from a complex adaptive system based on investigation of the past and present state of the system. This implies that surprise is a characteristic of such systems. This also implies that complex adaptive systems are like open systems rather than closed,...

On the practical side of philosophy of science. Adding nuance to Karl Popper on falsification. Further argument for the view that theories are useful but not "true." This may seem to contradict the realist view that theories are general descriptions of causal relationships. But I don't think that this is what is is implied. Rather, useful theories can be viewed as fitting the data because they reveal underlying structures that are not observed directly but only indirectly.  There is a...

If there’s one thing I’ve learned in my twenty plus years of market-watching it is that markets hate uncertainty. Uncertainty breeds volatility and volatility usually prefaces a panic.…No matter how powerful you are, you can’t dictate to markets for very long without there being a comeuppance. Even the Fed understands this. That’s why for the past ten years central banks have embarked on a communications policy to massage markets first, to prep them for any changes in monetary policy....

The global economy is growing, but so is uncertainty. This column presents a new quarterly index of uncertainty for 143 countries. The World Uncertainty Index reveals how uncertainty in the world has evolved over time, whether it is synchronised across countries, and how it compares across income groups and political regimes. VoxeuGlobal uncertainty is rising, and that is a bad omen for growth Hites Ahir, Senior Research Officer, IMF; Nicholas Bloom, Professor of Economics at Stanford...

Systemic uncertainty in a complex adaptive system. Spontaneous natural order is messy.Cassandra's LegacyShould we Prepare for a New World War? Answers from the Patterns of Past Ugo Bardi | Professor in Physical Chemistry at the University of FlorenceSee alsoStatistical Modeling, Causal Inference, and Social ScienceHey! Here’s what to do when you have two or more surveys on the same population!Andrew Gelman | Professor of Statistics and Political Science and Director of the Applied...

Keynes and the fundamentals of probability.Lars P. Syll’s BlogTruth and probabilityLars P. Syll | Professor, Malmo University

One way that heuristic thinking works.Statistical Modeling, Causal Inference, and Social ScienceN=1 survey tells me Cynthia Nixon will lose by a lot (no joke)Andrew Gelman | Professor of Statistics and Political Science and Director of the Applied Statistics Center, Columbia University

Yesterday brought the launch of a new and revised edition of Doing Capitalism in the Innovation Economy by William Janeway. Anybody who read the first (2012) edition will recall the theme of the ‘three player game’ – market innovators, speculators and the state – informed by Keynes and Minsky as well as Janeway’s own experience combining an economics PhD with his experience shaping the world of venture capital investment. The term refers to how the complicated interactions between...