Yet if history teaches anything, it’s that whenever economists feel certain that they have found the holy grail of endless peace and prosperity, the end of the present regime is nigh. On the eve of the 1929 Wall Street crash, the American economist Irving Fisher advised people to go out and buy shares; in the 1960s, Keynesian economists said there would never be another recession because they had perfected the tools of demand management.

2008 crash was no different. Five years earlier, on 4 January 2003, the Nobel laureate Robert Lucas had delivered a triumphal presidential address to the American Economics Association. Reminding his colleagues that macroeconomics had been born in the depression precisely to try to prevent another such disaster ever recurring, he declared that he and his colleagues had reached their own end of history: “Macroeconomics in this original sense has succeeded,” he instructed the conclave. “Its central problem of depression prevention has been solved.”

Sigh...it seems like every month there is new article that degenerates economics by comparing to a religion or astrology.

Economists don't need to be able to predict http://greyenlightenment.com/why-economists-dont-need-to-be-...

A doctor cannot predict with 100% certainty when or if someone will get sick.

A car mechanic cannot predict with 100% certainty when someone's car will fail.

Economics models such as the Black Scholes equation do an adequate at describing reality. Are they perfect/ no, but in most instances good enough. When such models fail, they can be modified, but that does mean having to do away with models altogether. In the past few decades, very sophistical financial models have been developed that can account for nearly everything. I agree that over-reliance on models can be problematic, but models are descriptive, not just prescriptive. Just saying "We don't know" and ending it there means scientific progress stalls.

The 2008 bank bailout, in retrospect , although maligned, was a success by infusing liquidity to the weakest parts of the economy (financial institutions, housing, etc.) so that the healthier parts (retail, tech, payment processing) would bot be hurt too much by contagion. The post-2008 bull market and ecoomic expansion is the longest ever, and programs such as TARP helped in that regard, but also the strength of the private sector, exports, technology, and consumer spending.

No sooner do we persuade ourselves that the economic priesthood has finally broken the old curse than it comes back to haunt us all: pride always goes before a fall. Since the crash of 2008, most of us have watched our living standards decline. Meanwhile, the priesthood seemed to withdraw to the cloisters, bickering over who got it wrong. Not surprisingly, our faith in the “experts” has dissipated.

The S&P 500 is 60% higher than it was in 2008. After factoring in dividends, it's 80% higher. Profits & earnings have also grown considerably. Dwelling on the mistakes and crisis of the past means one overlooks how things have improved.

For decades, neoliberal evangelists replied to such objections by saying it was incumbent on us all to adapt to the model, which was held to be immutable – one recalls Bill Clinton’s depiction of neoliberal globalisation, for instance, as a “force of nature”. And yet, in the wake of the 2008 financial crisis and the consequent recession, there has been a turn against globalisation across much of the west. More broadly, there has been a wide repudiation of the “experts”, most notably in the 2016 US election and Brexit referendum.

I agree that many experts who predicted a bear market and recession as a consequences of Brexit and Trump were dead wrong, but that goes to show how hard predicting is (but I'm sure personal political biases also played a role). But economics is also descriptive: the US economy did not enter recession, simply because Brexit and Trump failed to have any negative impact on earnings.