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« One More Thought on Those Residues | Main | Remembering Don Lavoie »

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Austrian economics and Pete for a teacher are a dynamite combination.

I would think that the charge against Austrians would be similar to the one Arnold Kling makes against Paul Krugman, that they were too pessimistic too early and that they did not predict many of details of the current crisis or that many of their specific predictions failed to materialize.

I'm sure youve heard the joke by now of Austrians predicting seven of the last five recessions by now.

I recall Pete mentioning Ed in that earlier post, and I know this is a fact: Pete never speaks lightly of those who had a direct impact on his intellectual development. He is always sincere.

Mike,

Yes a broken clock gets the time right twice a day. Understand.

But in the case of this particular gentleman, he actually detailed the issues with falling housing prices and the difficulties of mortgage back securities. I did not say I predicted it, I said Ed Weick did and the stakes involved where beyond what any of us could imagine in our own private lives. Seriously!

I pushed back against Ed and argued he was too pessimistic. And that the economy could absorb a silly amount of restrictions. Ed pushed back on me and gave detailed arguments about why this was different because of the mortgaged back securities and the leveraging going on.

So while I agree that many so-called "Austrian" types are guilty of the "a broken clock gets the time right twice a day", Ed Weick does not fall into that category.

Pete

Let me just add that although I haven't known Ed as long as Pete, he got this more right than anyone else I know, to my own embarrassment in also pushing back against his pessimism right before things began to fall apart.

Ed is also a gentleman - he could easily have done the "I told you so" routine on my in the last few months, but he never has.

This thread makes me wish I could learn more about Ed Weick and his work. My Google search did not help. Can you provide a link? Or would that be inappropriate?

If Austrian economics really helps investors, why aren't there a lot more folks in finance using it?

to TGGP__The essence of the political economic theory developed by the Austrian scholars is seldom seen in the financial literature. My experience included two very unique teaches; the 2d was Pete when he taught but two years at Oakland University. We met and began a deep teacher/student relationship.

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