Are Economists telling us the truth?
Of course economists are telling us the truth but if economists know everything about modern societies and the way economies work – why aren’t they working for themselves instead of working as a wage earner for a bank or financial institution?
They don’t know all the answers and they never will!
Quotes – “In all probability” “it’s trending that way”
These are answers you hear regularly for economists from a question asked from a journalist on the evening news. Why do they use terms such as this? It’s because to be vague about your answer is one way of answering a question you don’t really know the answer to. No one really knows the answer to how the stock market or a countries economy will do over the long term. There are too many variables especially in an economy to predict what will happen. An economist can take a knowledgable guess about what should happen or what strategy a government should take next but they have no control over the consequences of decisions made by government. Unfortunately for us, governments are only voted in for short terms, so many times they make decisions that are in their best interest as politicians and not to the long term benefit of the economy.
I love this quote about economists by Laurence J.Peter – “An economist is an expert who will know tomorrow why the things he predicted yesterday didn’t happen today.”
Conflicts of interest
Economists are experts and expert advice can sometimes be plagued with conflicts of interest or can be incomplete or inaccurate. How many times have you heard an expert talking about a particular topic that is the subject of “a report” only to find that the expert has lost perspective on the “bigger picture” surrounding them. To elaborate on conflicts of interest, how many experts be they banks, brokers, real estate agents, lenders etc, are working in our best interests. None I would say. As I mentioned in another post Do you need a financial planner or guru? it’s not very often that you see professionals driving around in “broken down old cars.” They have usually made very good money from selling products, services or advice which is not necessarily always to your benefit. You can bank on the fact that it is always a benefit to their bank account though.
Do it yourself
Economists and other professionals are important and an essential part of our economy but I’m just trying to point out that they are not always right and not always working in your best interests. Who is? You hopefully. So although we should take notice of everything going on around us it is very, very important that the final decision should be our own.
Do your homework – listen to professionals but make your own decisions. No one should take care of you and your money better than you will.
Remember – it’s Yoursavings!!