Irrational with money
Bruce Bower’s excellent article on “Simple heresy” (SN: 6/4/11, p. 26) showcases the blindness of mainstream economics. Namely, economics is often more like the weather than a game of dice: chaotic — with catastrophes, cycles and all manner of weird behavior. Yet economists continue to use statistical models that work “until they don’t.” So it is not surprising that investment strategies that use simple heuristics may do better than the pseudoscience of economists. Meanwhile, real science is not stymied by chaos, as climate science is now demonstrating.
Dick Burkhart, Seattle, Wash.
I have thought for years that economists and their ilk must live in some parallel universe where all decisions made by consumers are rational and well-thought-out, with reams