People that know me well know I like to share my economic
views. Those that know me really well,
know those views probably aren’t up to much.
The mainstream broadcast media and tabloids go to
extraordinary lengths to explain why important economic situations are
happening, and in certain print media opining who is to blame. However, they
don’t assert some important health warnings.
Putting aside my opinion that the economics of the UK aren’t
as bad as the media would have us think, I believe these health warnings are an
important omission that should be articulated explicitly with every major
market movement.
Firstly, all economists look at a situation through their
own etymological lens. There is never a consensus on what will happen next;
which means a fair few are right or wrong, some or all of the time. And like
all investments, past performance is no indication of the future. You only have to look at the splits on the Bank of England's Monetary Policy Committee for first hand evidence.
Secondly, the models used to generate the statistics that
are moving markets that can contain spurious data, are open to manipulation,
calculated differently by nations, given different levels of importance
according the economist and are most importantly, definitely laggard indicators
to what is really happening.
Media has an obligation for balance, which they deliver with varying degrees
of success. While they succeed in covering these different views,
they should also point out that the views of all economic experts and their
data should be taken with a considerable pinch of salt.
