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Comment by JumpCrisscross | Hacker News Reader

Reading ZH like Reddit will always turn out to be toxic. It isn't just the low signal-to-noise ratio. The site's core Austrian philosophy is at odds with the forefront of economic evidence.

I skim it from time to time. Very quickly. If I see something interesting, I look look at the source. If it's credible, e.g. Reuters, I cautiously read. If it isn't, I research it. Once in a while I'll come across novel, credible sources this way. This is the No. 1 way to get value from ZH.

The other time I read ZH is when I have a specific crisis on mind, e.g. Greece/Brazil/Venezuela shitting the pot. ZH throws up a good sense of how the bear market feels. Still terrible analysis. But good sentiment stock.

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'The site's core Austrian philosophy is at odds with the forefront of economic evidence.'

Which evidence are you referring to? Would you mind sharing some of it?

A slightly technical read, but here you go: http://econfaculty.gmu.edu/bcaplan/whyaust.htm.

So, a link to conjecture from an associate professor at the PREEMINENT SCHOOL for studying Austrian School economics in the US... is evidence against Austrian school economics?

Let me put it this way: there is a lot of financial incentive for Austrian School economics to appear "wrong", because Keynesian "economics" is really all about printing money and earmarking it for buddies within a given office's constituency.

Austrian School economics can't really actually be wrong. It's primarily the study of basically common sense things that can be proven a priori, such as subjective value (if you like purple more than I do, a purple bike might be worth more to you than to me... can something like that really be proven wrong?) and ideas like allowing people to spend money as a means of expressing the value of a given good or service.

The fact that there is an active movement within our government and its "education" system to apparently disprove such things is preposterous. But given the financial incentives, it's not surprising.

I'd have thought the opinion of an academic based at the pre-eminent school for studying Austrian economics in the US would be considered an unusually informed one. Especially when he explains why even though he's largely politically aligned with them he thinks much of their theory is lacking.

Let me put it this way: the reason the academic mainstream has relatively little regard for Austrian economics and even less for permabear investment advice based around passing familiarity with Austrian economics has nothing to do with printing money for their buddies (which the more influential half of the economic establishment has been passionately arguing against for decades) and everything to do with adherents of the discipline's tendency to rely on rants about government conspiracy once the economic problem gets a bit more complicated than determining who buys the purple bicycle from whom.

The education system isn't in the slightest bit interested in disproving the sort of trivial economic stuff about preferences that most microeconomists simply absorb as foundational axioms on the first day of their undergrad course rather than writing papers about how they can be deduced from the statement "humans act", but they're rather more sceptical about extending that to "therefore, it's true a priori the gold standard is the only way to run an economy and that QE will inevitably lead to uncontrollable hyperinflation and large scale malinvestment. (Which is the sort of prediction made on a regular basis by Austrian-inspired economic commentators on finance sites like the one being discussed here). Especially if the proponent of the idea starts ranting about "financial incentives" and wrapping inverted commas around the word education at the mere suggestion that such hypotheses might be falsified.

Milton Friedman was the father of Neo-Keynesian economics, and Milton Friedman literally INVENTED monetarism. If you actually think Austrian School, which has been considered heterodoxy, if not blasphemy, to any standing US government in the past 80 years, is the influence behind quantitative easing, then I don't really know what to say at this point...

> Austrian School economics can't really actually be wrong.

If you can't be wrong, you're not making claims about the real world.

I appreciate the link, this was a good read even though I ultimately disagree with his overall assertion. This issue isn't going to be settled here, or anytime soon, it's been going on since before many of us were born, and will probably continue after we're gone.

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