You're not exactly describing the difference. I would say that:
1. We have statistical evidence from large numbers of SIMILAR people with similar tumors. Economic events tend to be highly dissimilar in terms of context (Great Depression? 1988 Savings and Loans Crisis? 1997 Asian Financial Crisis? 2008 Global Financial Crisis?), and only to be similar in terms of before-and-after on some narrow set of parameters. This makes prediction and counter-factual history for economic stuff really hard.
2. We also understand some of the mechanisms of how tumors work and affect physiology. These are founded upon a large body of knowledge of causation and empirics in medicine, chemistry, and biology. Economics lack a comparably reliable and large body of knowledge because of 1.
>"We really have no idea what would have happened had the fed not intervened and allowed a normal bankruptcy to occur."
This is the fallacy: You really have no idea. That's not an insult. People who do this for a living, like, say, FRB economists, do know the consequences of letting bank runs occur and not providing liquidity during a crisis. It's well studied.
>" Economic events tend to be highly dissimilar in terms of context (Great Depression? 1988 Savings and Loans Crisis? 1997 Asian Financial Crisis? 2008 Global Financial Crisis?)"
I'm not sure this is true, either. Financial crises are surprisingly similar [0].
And we have statistical evidence from large numbers of economies. It's not perfect. We make a best guess and go for it. That's my point.
Contrary to popular belief, these guys aren't winging it. As I've said, go check out the research they're doing at the Fed. That's the cutting edge of economics.
You are using a straw man to defend the indefensible.
"These guys" are clearly winging it, when we remember the definition of "These guys":
Ideologues touting Efficient Markets and the Washington Consensus, often in the pay of corporations, and using clearly falsified theories to do so.
(You can get an idea of how bought they are by watching "Inside Job".)
No one is saying that no economists anywhere ever got anything right. The problem is that the economists who do get things right are the dissenters from the orthodoxy of "These guys".
So why don't you go check out the research referenced at
>"So why don't you go check out the research referenced at"
I read plenty of economic research, thank you. Every day. So, while I appreciate a link to a what is essentially the site of a pundit (whom I have read, by the way), this is not the bleeding edge of economics. When is the last time this guy actually wrote a paper?
>"As for the Fed, Volcker's Fed yes, Greenspan and Bernanke's Fed no."
Right. So, Volcker, dealing with intense inflationary pressure in the 1980s, and Bernanke, dealing with massive deflationary pressures in 2008, should use the same policy tools? I'm sorry, but you clearly need to brush up on the basics before you go attacking someone for their lack of economic knowledge. This is pointless.
I was referring to the Hudson book mentioned at the link, not Roberts's "punditry" as you call it.
Oh, and where did I say Volcker and Bernanke should use the same policy tools?
The big difference between Volcker and Greenspan is that Volcker stood up to congress, while Greenspan caved to the politicians and gave them the bubble they wanted. And politicized the Fed.
Or in your own words,
"And much of the housing portion was political mandate."
Did you not know this?
And where did I attack you for lack of economic knowledge?
I attacked you for using strawman arguments and putting words in peoples' mouths, and I stand by that.
How do you know before a tough, life-threatening operation whether the tumour you are getting removed will kill you? You don't.