My monetary economics professor in grad school was teaching a paper and told us that when the authors claim it's obvious, that means it's not obvious. So he wrote out the derivation over the weekend and gave us a four-page, single-spaced handout with all the equations behind that single "obvious" result.
This is way off topic but hopefully it will get allowed because I think you have the expertise to help:
It seems to me that the widely accepted practice of market stimulation by interest rate intervention has the cost of destroying price discovery. Also, that it is a primary cause of wealth inequality. These relationships seem to me actually obvious: push down DCF denominators and valuations go up, inefficient businesses stay in business and employ people digging holes. Sure, we get good jobs reports, but we also work harder to make less. Meanwhile those who hold wealth see its value increase disproportionate to 'actual' worth and common people who hold little or none can afford less and less of it. It seems like a pretty direct policy of 'rich get richer, poor get poorer'. Worse yet, as I look at the world around me, it all seems to support my hypothesis. Tesla, spacs, NFTs, housing, blackrock & vanguard & gates buying land, etc. I could go on and on with examples.
But the thing is, I got shitty grades in my college econ courses. It's laughable to me that all the highly educated people at central banks somehow haven't thought of this but I have. I'm being serious, I'm kind of a lazy idiot. By any reasonable measure, I expect that I'm wrong.
Could you point me in the direction of some primary sources that address the relationship between interest rate intervention and price discovery? I've been told to pick up an undergrad macro text, but those all just seem to say "low rates = easier to get loans = mo' jobz" without any rigor.
Open market ops and other interventions are so common and accepted, the only other people I see complaining are precious metals schizos. Surely there's a theoretical foundation for the policy/practice.
Isn’t there a thing about how mathematicians and scientists in the 19th century would carefully explain as if the intended audience we’re laypeople. Where as in the 20th century academic writing and popular science writing diverged such that an academic writer could say such and such is obvious and be speaking to a very niche audience?
I heard of a prof who in a lecture said "It's obvious that..." and a student challenged him on it. "Is that really obvious?" The professor looked at the board for a minute, then left the room. 45 minutes later, the professor came back and said, "Yes, it's obvious!"
You keep using that word. I do not think it means what you think it means...
I have a friend who was in grad school and found an "...and so it follows" proof that was in standard textbooks dating back decades. To this day he can't find anyone to fill in the remainder of the proof to get the result.
The confusion comes from the differences in what words like 'obvious', 'trivial' mean in Mathematics and what they mean in English. Same deal with the word 'significant' in Statistics and English.
I used to take swipes at Haskell and Category theory folks for their use of their ektomorphisms but later realized the point of using words that are not used in regular English.
In mathematics obvious/trivial means no new math or technique needs to be invented to go from this step to that step, it does not mean it would be easy. This is fairly standard usage.
bachmeier|4 years ago
boppo1|4 years ago
It seems to me that the widely accepted practice of market stimulation by interest rate intervention has the cost of destroying price discovery. Also, that it is a primary cause of wealth inequality. These relationships seem to me actually obvious: push down DCF denominators and valuations go up, inefficient businesses stay in business and employ people digging holes. Sure, we get good jobs reports, but we also work harder to make less. Meanwhile those who hold wealth see its value increase disproportionate to 'actual' worth and common people who hold little or none can afford less and less of it. It seems like a pretty direct policy of 'rich get richer, poor get poorer'. Worse yet, as I look at the world around me, it all seems to support my hypothesis. Tesla, spacs, NFTs, housing, blackrock & vanguard & gates buying land, etc. I could go on and on with examples.
But the thing is, I got shitty grades in my college econ courses. It's laughable to me that all the highly educated people at central banks somehow haven't thought of this but I have. I'm being serious, I'm kind of a lazy idiot. By any reasonable measure, I expect that I'm wrong.
Could you point me in the direction of some primary sources that address the relationship between interest rate intervention and price discovery? I've been told to pick up an undergrad macro text, but those all just seem to say "low rates = easier to get loans = mo' jobz" without any rigor.
Open market ops and other interventions are so common and accepted, the only other people I see complaining are precious metals schizos. Surely there's a theoretical foundation for the policy/practice.
cinntaile|4 years ago
xtiansimon|4 years ago
AnimalMuppet|4 years ago
You keep using that word. I do not think it means what you think it means...
kurthr|4 years ago
iaw|4 years ago
srean|4 years ago
I used to take swipes at Haskell and Category theory folks for their use of their ektomorphisms but later realized the point of using words that are not used in regular English.
In mathematics obvious/trivial means no new math or technique needs to be invented to go from this step to that step, it does not mean it would be easy. This is fairly standard usage.
unknown|4 years ago
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