Jan 24, 2020

Kevin Duffy on the track record of "experts"

There is no human progress without the heretics who question prevailing wisdom. As Malcolm Forbes once said, “Conventional wisdom seldom is.”

History is littered with “experts” getting it grossly wrong.  For example...

The Wright Brothers came out of nowhere to invent the airplane:
"Heavier-than-air flying machines are impossible."
~ Lord Kelvin, Royal Society, 1895
Geologists have been worrying about Peak Oil a long time:
"The peak of [American oil] production will soon be passed – possibly within three years."
~ David White, Chief Geologist for the U.S. Geological Survey, 1919
"The energy future is bleak and is likely to grow bleaker in the decade ahead."
~ James Schlesinger, first Secretary of the U.S. Department of Energy, 1979
Image result for oh yeah? book edward angleyIndustry leaders, economists, bankers, politicians and business media failed to foresee the 1929 crash:
"Stock prices have reached what looks like a permanently high plateau."
~ Irving Fisher, October 16, 1929
"It may be well again to stress the all-important point that the Federal Reserve has it in its power to change interest rates downward any time it sees fit to do so and thus to stimulate business."
Financial World, April 10, 1929

Before WWII, fascism held a strong appeal among elites:
"It would be a dangerous folly for the British people to underrate the enduring position in world history which Mussolini will hold; or the amazing qualities of courage, comprehension, self-control and perseverance which he exemplifies."
~ Winston Churchill, 1938
“Military intelligence” has a well-deserved reputation for being an oxymoron:
"No matter what happens the U.S. Navy is not going to be caught napping."
~ Frank Knox, Secretary of the Navy, December 4, 1941
The economic geniuses failed to see the inflation of the 1960s and 1970s coming:
"In all likelihood world inflation is over."
~ Per Jacobsson, IMF Managing Director, 1959
Technologists underestimated the digital revolution:
"I think there is a world market for maybe five computers."
~ Thomas Watson, chairman of IBM, 1943
"Computers in the future may weigh no more than 1.5 tons."
Popular Mechanics, forecasting the relentless march of science, 1949
"640K [of memory] ought to be enough for anybody."
~ Bill Gates, 1981
In the 1970s, climatologists thought the biggest risk was global cooling:
"We simply cannot afford to gamble... by ignoring it. We cannot risk inaction. Those scientists who say we are merely entering a period of climatic instability are acting irresponsibly. The indications that our climate can soon change for the worse are too strong to be reasonably ignored."
~ Lowell Ponte, The Cooling (1976) 
As late as the 1980s, mainstream economists lauded the Soviet economy even as it was coming apart at the seams:
"Those who think the Soviet Union is on the verge of economic and social collapse are kidding themselves."
~ Arthur Schlesinger, Jr., Establishment historian, 1982
"The Soviet Union is not now nor will it be during the next decade in the throes of a true systemic crisis, for it boasts enormous unused reserves of political and social stability."
~ Seweryn Bialer, Sovietologist, Columbia University, Foreign Affairs, 1982
"What counts is results, and there can be no doubt that the Soviet planning system has been a powerful engine for economic growth. . . . The Soviet model has surely demonstrated that a command economy is capable of mobilizing resources for rapid growth."
~ Paul Samuelson, Massachusetts Institute of Technology, Nobel laureate in economics, Economics, 1985 edition of his widely used textbook
The financial experts failed to identify the Japan bubble of the late 1980s:
"At the rate things are going, we are all going to end up working for the Japanese."
~ Lester Thurow, MIT economist, 1989
After 911, the defense experts were convinced Iraq had WMDs and the Iraqi people would welcome American soldiers with open arms:
"My belief is we will, in fact, be greeted as liberators... I think it will go relatively quickly... weeks rather than months."
~ Vice President Dick Cheney, March 16, 2003
In 2007 (before the 2008 financial meltdown) central bankers felt the subprime lending collapse was contained:
"At this juncture...the impact on the broader economy and financial markets of the problems in the subprime markets seems likely to be contained."
~ Ben Bernanke, Federal Reserve Chairman, AFX News, March 28, 2007
In 2020 the Davos elites predicted the business cycle was dead and environmental Armageddon right around the corner:
"The boom-bust economic cycle is over."
~ Bob Prince, Co-CIO, Bridgewater Associates, World Economic Forum, January 22, 2020
"Davos is cloaked in white, but its agenda is green.  Environmentalism - fighting climate change in particular - has emerged as one of the biggest priorities of the World Economic Forum..."
~ Bloomberg Businessweek, January 17, 2020
~ Kevin Duffy, January 24, 2020

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