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Comment by gruez | Hacker News Reader

>I think this goes the other way around. Our method for understanding the economy is flawed and is not properly capturing what all consumers know intuitively, things kind of suck, even when you have a job and even when you're still buying things.

It seems kind of lazy to observe that anecdotes contradict statistics, and then conclude that it's the statistics are wrong without providing any empirical evidence to the contrary. This style of argumentation basically allows you to make whatever "intuitive" claim you want and handwave any empirical evidence to the contrary because the empirical evidence isn't "capturing what [we] all know intuitively".

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Anecdote would be saying that some individual over on 4th Street feels that things aren't that great. "Consumer sentiment" (or whatever name) is actually a statistic.

So now you're at two statistics, one that measures economic activity in jobs and output, and the other that measures peoples' intuitive feel of the economy. I think the gap between them might be that peoples' confidence was shaken by inflation reigniting after 15 years.

But polls show that around of population are flat out wrong on certain objective measures, like GDP, the S&P 500 index, and the unemployment rate[1]. If they can't get basic factual questions right, why should we put much stock in their "intuitive feel of the economy"?

[1] https://www.theguardian.com/us-news/article/2024/may/22/poll...

Guys this isn’t that complicated.

Basically every commercial interaction you have these days involves someone trying to cheat you, with basically no way to find recourse to human understanding or help.

It’s every day, every time you interact with a corporation as a consumer. It fucking sucks profoundly and people are completely exhausted by it.

Have you really not noticed?

But the questions isn't "how do you feel about the economy", it's "do you think the s&p 500 went up or down". Even if you think the stockmarket is fake and disconnected from what actually happens on main st, you should still be able to correctly answer whether it went up or not. Failing to do so shows that either you have no grasp on how the S&P 500 is actually doing, can't hold opposing concepts it your head (ie. the "real economy" is doing shit but the S&P 500 is doing great), or can't follow basic instructions. Neither makes me confident in other things you're saying, like how how good the economy is.

> you should still be able to correctly answer whether it went up or not

Why? Who fucking cares?

Some guy calls my phone during dinner with some survey about the economy. I answer every question with a variation on “fuck you and your economy” and then hang up.

I grew up in a family of social scientists and yet it still shocks me how much people actually believe the words “studies say” and “experts insist” when it comes to matters of human sentiment and opinion.

>I grew up in a family of social scientists and yet it still shocks me how much people actually believe the words “studies say” and “experts insist” when it comes to matters of human sentiment and opinion.

But the question we're asking isn't "how people feel about the economy", it's "how the economy is actually doing". I don't think anyone here is seriously arguing that the public is wrong about their own "sentiment and opinion". They're going to be right almost by definition. What is actually being disputed is whether public's "sentiment and opinion" actually reflects reality. To that question I don't see why we should give unlimited credence to "human sentiment and opinion".

Do they get a reward for being "right" in the eyes of the survey company or something? They are being asked how the economy is doing and they are saying fuck this. I'm guessing people have a basic sense that when they answer a media survey they're contributing to the narrative that the media will use, and they want the narrative to be this sucks. It's really not that deep.

As for "sentiment and opinion" it's the basis for democracy. Of course we should give unlimited credence to it when deciding how to organize society, what's the other approach?

>Do they get a reward for being "right" in the eyes of the survey company or something? They are being asked how the economy is doing and they are saying fuck this. I'm guessing people have a basic sense that when they answer a media survey they're contributing to the narrative that the media will use, and they want the narrative to be this sucks. It's really not that deep.

They don't, but like I said earlier it's fair to question the veracity of their statements if they can't get objective questions right. Moreover, if it's really the case as you claim that they don't care about the object level question and only care about "the narrative", what makes you think that the "the narrative" stops at the economy and not at some high level like "the political system" or "society"? In other words what makes you think they actually think the economy is doing bad, and they're not answering dishonestly because they're disaffected about the government/politics/society as a whole?

>As for "sentiment and opinion" it's the basis for democracy. Of course we should give unlimited credence to it when deciding how to organize society, what's the other approach?

Again, you're conflating "how people feel about the economy" and "how the economy is actually doing". Moreover, "sentiment and opinion" might be "the basis for democracy", but it doesn't follow that when it comes to factual and objective questions it should get unlimited credence.

> Again, you're conflating "how people feel about the economy" and "how the economy is actually doing".

Indeed. And you're suffering from the delusion that there's some kind of distinction here that matters.

There isn't. The economy fucking sucks. It sucks because normal people feel trapped and helpless in the face of corporate power and constant, rampant unethical conduct and cheating that seems to permeate literally every daily commercial interaction. When you ask them about the economy they answer that it fucking sucks, because, it does, for them, daily. This is bad and it keeps making people's daily lives worse.

If you haven't experienced that then congratulations, you're either living a very isolated or minimalist life or you have financial resources that put you above this dynamic. Or maybe you don't live in the US. Or maybe you're building the tools and processes that are inflicting this misery on others. Who knows.

But my argument is that most readers of this article and comment thread should be able to look around and realize what's happening without resorting to regression analysis. I think most people here have cushy employment for the most part so you'll have to look elsewhere. Have you tried to interact with an airline lately? Healthcare billing? A bank?

It's a fucking horror show. Now, extraplolate what that experience would be like if it was every single part of your actual job. Like you actually worked for a company that treats you, the employee, the way Comcast treats you when you want to cancel service?

Ever tried getting someone from Uber to talk to you as a customer? You think they treat drivers differently? What if you're driving for them to feed your children? What kind of mood would you be in? How would you think "the economy" is going?

Did you know that you can apply, get hired, and actually start work at an Amazon warehouse without speaking verbally to a single human being ever? Like you literally go online and fill out forms, go to a building and use a kiosk to check in, and so on, and are on the job without a single conversation.

Can you try to actually really think about what being in this economy feels like to most people?

Now call them and ask them how the economy is doing. Do you think they trust you, an educated social scientist employed at faceless corporation that is calling them to publish some news report on what they think? Do you think they're interested in impressing you with their stock market fluency? To the extent they are willing to talk to you at all it's in the hopes that you'll fucking listen to them when they tell you to fucking do something about this for once.

For half a dozen cycles in a row voters have picked the person they thought was least in service of the assholes who are in charge and inflicting this on everyone, increasingly agitated that nobody actually fucking does anything about it. They'll be doing it again later this year.

>Indeed. And you're suffering from the delusion that there's some kind of distinction here that matters.

>There isn't.

the distinction does matter because policy discussion should be around facts rather than vibes. Voters are the ultimate arbiters for what policy should be, but that doesn't mean we should shrug when their beliefs are objectively wrong.

> The economy fucking sucks. It sucks because [...]

All the points you've made about bad the economy talks past the points raised by mainstream economists. Sure, "trapped and helpless in the face of corporate power" isn't great, but how does that compare to 10% unemployment, or an actual recession? What makes for a economy that doesn't "fucking sucks"? More to the point, vibecession might have started post pandemic, but everything you said existed to some extent pre-pandemic. Has "corporate power and constant, rampant unethical conduct and cheating" actually gotten worse? Or did the perception get worse? That's the problem with going off vibes. Because there's no attempt to quantify it, it's possible to know whether something actually got worse, or people merely thought it got worse. You argue that people "should be able to look around and realize what's happening without resorting to regression analysis", but this comment section is full of examples where people were misinformed about various things (eg. objective economic measures or crime stats). You end up having to come up with contrived explanations to explain their behavior (ie. them being wrong on factual questions shouldn't impact their credibility because they're being wrong to express rage against the system).

> the distinction does matter because policy discussion should be around facts rather than vibes.

You're just suggesting we use different vibes.

There's nothing more factual about a random opinion survey or report from an economic research organization with an agenda than anything else.

Mainstream economics IS all vibes at this point. Not sure how someone could miss it.

Yeah. For normal people, "I am the economy". That is, I don't care about the national economy or the world economy. I don't care about how many widgets get produced this month. What difference does it make to me if the national economy is doing great, but I'm going broke? I care whether I can afford to buy what I need this month. To me, that's the economy.

(With "I" meaning the average person, not me personally.)

Yet as a whole, people estimate the nation's economy worse than their own. Clearly this can't be the case if everyone thinks their economic circumstances are the nation's economic circumstances, because if that were the case you'd expect them to align on a national basis.

https://www.pewresearch.org/politics/2024/05/23/views-of-the...

I think you could (almost) build a consistent picture: Economic output is doing well, a lot of people are working, but the rich are taking all the gains and the workers are just barely surviving.

The problem is, if that's the case, who's buying all the output? It's not just going into warehouses. So people must be able to buy all this stuff.

An alternate view would be that people have been buying all this stuff, mostly on credit, and are realizing that they're maxed out on credit, especially if interest rates rise.

But ultimately, the "sentiment" view matters. It may not matter as much as the actual output numbers, but it matters, because people are not purely "homo economicus". They make decisions on how they feel about how things are going, and if they think things are going badly, they buy less, and eventually that influences the actual figures.

> I think you could (almost) build a consistent picture: Economic output is doing well, a lot of people are working, but the rich are taking all the gains and the workers are just barely surviving.

You figured it out.

Maybe replace "the rich" with "those with capital and market power" but that's mostly a distinction without a difference.

Could you now address the objection? If that's the case, who's buying all the output?

Those to whom the returns on capital are accruing.

Again none of this stuff is super groundbreaking. Shantytown hills overlooking mansions surrounded by high walls and barbed wire is kind of a global norm.

As America edges closer it only feels unfamiliar to those of us that have become accustomed to something different.

I don't believe it.

Take cars specifically. The US makes 11 million new cars a month. If regular people can't afford them, are billionaires really buying up all those cars? How many new cars does a billionaire need? Where are they parking them all?

I can believe your explanation with money. I can even believe it with houses, with rich people buying up houses as an investment. But I can't believe it with cars. Regular people are buying new cars, and regular people think they can't afford new cars. How do we make sense of that?

Because cars wear out and are scrapped? Not sure where you're going with this.

That's exactly the point - there's some sort of disconnect and people just want to say "they're wrong" instead of trying to figure out why people feel that way.

>people just want to say "they're wrong" instead of trying to figure out why people feel that way.

Why are these two things positioned as opposing/contradictory? Why can't those people be wrong but we still try to figure out why they think that way?

Ask yourself the reverse question now.

Why can't it be true that the economics profession is wrong, or better yet "not even wrong" and not really even talking about anything that has real world applicability?

Given the last few decades that should probably be the starting premise of any analysis.

>Why can't it be true that the economics profession is wrong, or better yet "not even wrong" and not really even talking about anything that has real world applicability?

I'm not ruling it out, only pointing out that it's a lazy argument to handwave away the statistics while not providing evidence that's equal or better than the ones you're trying to refute. This is especially true when the discrepancy is from a group of people who can't get basic facts right. Maybe they're actually right but there's some contrived reason they're not answering straightforward factual questions correctly, or maybe they're just wrong.

I have a degree in economics and both my parents taught economics and I grew up with a couple Nobel prize winners in economics around the dinner table from time to time.

Which, in fairness, I didn’t mention earlier and isn’t necessarily something that moves forward a message board discussion anyways.

But like maybe consider the possibility that at this point “mainstream economics” is a lot closer to astrology than it is to science.

> It seems kind of lazy to observe that anecdotes contradict statistics, and then conclude that it's the statistics are wrong without providing any empirical evidence to the contrary.

Anecdotes are empirical evidence. Statistics are just collections of anecdotes obtained through systematized processes. As such, statistics are only as good as the process. 1 good observation can be better than 100 bad observations.

If you want to be nitpicky I suppose you can claim that anecdotes is technically evidence and therefore that statement is incorrect, but in the context of that comment it doesn't change much. We basically have data collected by statisticians at government agencies compared to... people's vibes. As you said yourself "1 good observation can be better than 100 bad observations", so I still think it's a poor argument to claim the professional statistics are wrong, and the only evidence you have is evidence that's worse than the ones you're trying to refute.

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