by Calculated Risk on 11/05/2008 03:24:00 PM

Robert Shiller on forecasting and the economy ...

"This is not a run of the mill recession that we are in. This is a crisis of confidence that we haven't seen since the Great Depression.
...
Ultimately I think economic forecasting is more guess work than people realize. In times when you don't have a fundamental change, you can exrapolate curves, and people do that pretty well. But right now I don't trust extrapolation. It also - forecasting - depends on how the new government, how the new president, what he does, how he shapes confidence - and those are also unknowns at this point."

And many other interesting comments ... "no one really knows what to do", "we are getting into Ben's nightmare scenario" ... "and then we try some other heterodox monetary policies":