{"id":17845,"date":"2016-02-16T13:39:38","date_gmt":"2016-02-16T18:39:38","guid":{"rendered":"http:\/\/olduvai.ca\/?p=17845"},"modified":"2016-02-16T13:39:38","modified_gmt":"2016-02-16T18:39:38","slug":"2016-the-year-wishful-thinking-fails","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=17845","title":{"rendered":"2016: The Year Wishful Thinking Fails"},"content":{"rendered":"<h3><a href=\"http:\/\/www.oftwominds.com\/blogfeb16\/wishful2-16.html\" target=\"_blank\">2016: The Year Wishful Thinking Fails\u00a0<\/a><\/h3>\n<p><i>If we collectively choose wishful thinking, catastrophic consequences are guaranteed.<\/i><\/p>\n<p><b>Wishful thinking has been an integral driver of the &#8220;recovery&#8221; 2009-2015:<\/b>asset bubbles aren&#8217;t bubbles, central bank policies are brilliantly successful, unemployment has dropped to levels of\u00a0<i>full employment<\/i>, and so on.<\/p>\n<p><b>The problems with wishful thinking that I describe in my book\u00a0<a href=\"http:\/\/www.amazon.com\/gp\/product\/1517160960\/ref=as_li_tl?ie=UTF8&amp;camp=1789&amp;creative=9325&amp;creativeASIN=1517160960&amp;linkCode=as2&amp;tag=charleshughsm-20&amp;linkId=UIIRVX6FXFXLDSAV\" target=\"resource\" rel=\"nofollow\">A Radically Beneficial World<\/a>\u00a0are becoming more apparent by the day:<\/b><\/p>\n<p>1. Elite\/Technocrat self-confirmation: Those in the top technocrat\/financial layer of the economy look at their own success and think\u00a0<i>since the status quo is working great for me and my peers, it&#8217;s working for everyone.<\/i><\/p>\n<p>2. This wishful thinking reinforces the positive bias of status quo institutions run by the technocrat caste and state apparatchiks: the mainstream financial media, government agencies, etc.<\/p>\n<p>3. Wishful thinking appears less risky that gambling on new ideas that might not pay off; wishful thinking is thus viewed by those benefiting from the status quo as the\u00a0<i>safe bet<\/i>.<\/p>\n<p>4. When we face difficult problems, wishful thinking is counter-productive because it doesn\u2019t generate solutions. Wishful thinking satisfies our preference for low-risk comfort, but it doesn\u2019t solve problems.<\/p>\n<p>If you\u2019re running a real enterprise, i.e. one that will bankrupt you if you fail to solve problems, wishful thinking is catastrophic.\u00a0\u00a0<b>There are few guarantees in life, but wishful thinking guarantees failure.<\/b><\/p>\n<p><b>Consider a short list of conventional economic\/financial beliefs that are shot through with wishful thinking:<\/b><\/p>\n<p>&#8212; China will manage to slowly depreciate its currency without upsetting the apple carts of global growth and capital flows (never mind that China&#8217;s leadership has no history of managing such a transition.)<\/p>\n<p>&#8212; Unemployment in the U.S. is less than 5%, a rate that signals full employment and a robust, durable job market (never mind the number of full-time jobs that can support a household remains anemic.)<\/p>\n<p>&#8230;click on the above link to read the rest of the article&#8230;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>2016: The Year Wishful Thinking Fails\u00a0 If we collectively choose wishful thinking, catastrophic consequences are guaranteed. Wishful thinking has been an integral driver of the &#8220;recovery&#8221; 2009-2015:asset bubbles aren&#8217;t bubbles, central bank policies are brilliantly successful, unemployment has dropped to levels of\u00a0full employment, and so on. The problems with wishful thinking that I describe in [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2,7],"tags":[127,1357,1529,4924,824,12429],"class_list":["post-17845","post","type-post","status-publish","format-standard","hentry","category-economics","category-survival-2","tag-charles-hugh-smith","tag-global-growth","tag-global-stock-markets","tag-oftwominds","tag-unemployment","tag-wishful-thinking"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/17845","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=17845"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/17845\/revisions"}],"predecessor-version":[{"id":17846,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/17845\/revisions\/17846"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=17845"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=17845"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=17845"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}