Be It Resolved: No One Has a Clue

I keep coming back to a comment from Mark Cuban in the weekend Washington Post. When asked, among a host of others, what book he would recommend to people trying to make sense of the current financial/economic turmoil, amidst a sea of high-tone choices from economists, investors, and others, here was Mark's answer:

I don't think there is such a book. In my humble opinion, people who actually believe they can understand all the issues are the ones that got us to where we are today. In reality, there are so many variables and so little data, it's all a guess. I don't think a book exists that can explain it. Is there a book out there called "No One Has a Clue What Is Going On and the Whole World Is Guessing"?

No, Mark, there is no such book. No one knows anything and we are making this up as we go along. People continually act surprised at how many big-brained sorts missed the current market conflagration as it developed, but should we really be surprised? That's what happens every time, and feeble attempts to apply the lessons learned last time around almost always lead to focusing on things other than what is causing the new problem.

I know, I know, it sounds nihilistic. But in some sense it's liberating: If no one truly knows anything -- beyond the simplistic bromides, like plant your corn early, avoid excessive leverage, etc. -- then the world is your Etch-a-Sketch, isn't it?

Comments

[cristian:]

It is written in the BOOK "you shall bring back employment" ! What kind of demand can you have on debt ?! How can you have a viable economy with a shrinking employment base, placing downward pressure on wages ? The geniuses that orchestrated this, thought that it will work on borrowed money and borrowed time indefinitely. Time to pay the fiddler. It not now, soon.

2008 Sep 04 02:32 PM

[debtacid:]

Need a clue? Try these for startes:

IOUSA
The Case Against the Fed
Fooling Some of the People All of the Time
The Creature From Jekyll Island
The Money Changers
The Road to Serfdom

2008 Sep 04 03:39 PM

[Kint:]

This is the best commentary I've read about the current state of our economy..

2008 Sep 04 05:08 PM

[mouse:]

There were plenty of "experts" that correctly told us what was coming, but there were many more "experts" who said that we had nothing to worry about......how do you figure out who is going to be correct beforehand?

2008 Sep 04 05:35 PM

[Jason Rines...:]

I just tell people to look at my comments for the last year. Plopping them into a book is a waste of time. The end game is a dramatic change in Washington. Almost all Americans will participate in rebuilding this economy but I expect nothing but deep recession/depression until 2012, then a large voter revolution. In between- our entire financial system may crash and if so, then a bunch of deadweight in Washington can be cleaned out sooner.

2008 Sep 04 05:40 PM

[Kelly Liebe...:]

Plenty of people knew this was coming and most chose to either ignore it, hide their head in their pillow or deny it as they made out with their cash before the average Joe could figure out what happened....
Some of us have been trying to sound the alarm for a year or longer and it has fallen on deaf ears.
Even now, as we are engulfed in this crisis we still have "financial" experts, politicians and bloggers denying the obvious.
No wonder people give up trying to sound the alarm to help other investors and decide to just mind their own financial business.

2008 Sep 05 09:06 AM

[notsosmart:]

great article.the only sad part is that many of the know it all nothings made out like bandits & could not care less as they secured their legacy fortunes.

2008 Sep 05 10:43 AM

[notsosmart:]

a society cant go on if mainly what it does is print monopoly money & trade valueless paper & documents.we were great making cars,building ships, a huge shoe & glove making industry,uniroyal making great tires,etc- all given away so for a few years we shuffled paper & bought cheap stuff.now we may have trouble even buying the cheap stuff.the paper shufflers are getting pink slips(heard today unemployment may go to 7-8%) by the so called experts & it may be higher as you cant believe anybody.

2008 Sep 05 02:53 PM

[Steven Hansen:]

there always is too many variables to accurately predict market outcomes. in the past there have been more potentially upmarket variables than potential down market variables. today the reverse is true. so the odds are now against a recovery until the negative variables work their way out of the system.

2008 Sep 06 01:30 AM

[alajac:]

Conquer the Crash by R. Prechter. He appeared to be early but in real money terms he nailed it. Elliott Wave Theory rocks.

2008 Sep 06 05:04 AM