The Experts Are Lying To You!! Here’s The Proof!!

Have you ever felt like the so-called Experts are lying to you well it's not Just you believe it or not but many Experts and especially economists are Knowingly lying to the general public Now this was talked about in a research Paper a few years back and it's safe to Say that it reveals a lot about how They're pulling the wool over our eyes Today we're going to summarize this Paper and tell you exactly what it means For you and for the Markets the paper that we'll be Summarizing is titled should economists Deceive pro-social lying paternalism and The Ben banki problem it was written Back in 2020 by George de Martino a Professor at the University of Denver We'll leave a link to it in the Description but we will warn you that It's quite a dense read as such we'll be Keeping things as simple as possible Over here and giving you just the juicy Details without the need to keep a Dictionary at hand anyways the paper Begins with an abstract and an Introduction which explained that Despite it being recognized as vital That economists speak the truth the Reality is that a lot of the time they Don't in fact the author includes a Quote from Economist anatol kety which States quote just as James Bond has a License to Kill Central Bankers possess

A license to lie I'm not sure that That's quite cool enough to build a 27 Film franchise off the back of but it Makes you think nonetheless now the Lying in question here pertains to Pro-social lying basically telling lies About the economy in order to create a Better outcome for society deception but For the greater good if you will what About the greater good the greater good How can this be for the greater good the Thing is while the intentions behind Pro-social Lying by economists might be For a better outcome the fact of the Matter is that what economists say about The economy will ultimately affect it to Use an extreme example here can you Imagine a respected Economist saying Everything's going to zero it would Create utter chaos this means that Economists have to be very careful with What they say and this can sometimes Mean staying overly optimistic even when The situation at hand might not be so Positive therefore there state ments Shouldn't be taken as gospel or as a Real economic forecast oh and by the way If you're enjoying the video so far help A guy called guy out by Smashing that Like button hitting that subscribe Button and showing that notification Bell who's boss anyway the author then Points out that some philosophers Believe that pro-social lying is

Actually a necessity and others not so Much on one hand lying can be warranted If it's for the Public's best interest But on the other hand there isn't really A limit to what economists can or can't Lie about there's no real rule book no Internal debates and no looking back at History to determine where the Boundaries lie it's entirely left to The Economist judgment to determine what is Acceptable and what isn't that in itself Can be a scary enough thought however Economists will tell pro-social lies to Prevent further disruption to the Financial system as we've seen over the Years what an economist says can and Often does determine which way a market Can swing and there are people who will Exploit this information hold up a Second there guy sorry to interrupt Folks but I just wanted to very quickly Tell you about the coin Bureau deals Page now this is the place where we have Put together some of the very best deals And Promos in all of crypto so you can Think things like exchange signup Bonuses trading fee discounts and money Off of Hardware wallets and much much More besides so if you want to check That out coin.com deals is the place to Go or you can just use the link in the Description of this video down below Thanks very much and now back to you guy So as the author of this paper points

Out quote economists tend to skip over The real world complications and nuances While downplaying the diversity of Intellectual Frameworks by leaving out Certain details economists remove the Opportunity for Market participants to Cause havoc in the markets now this Causes the author to raise a few Questions for starters is this as it Should be can a compelling case be made For economic exceptionalism is economics Unlike other fields in ways that make Paternalistic coercion through lying Ethically appropriate well to help find The answers to these questions the Author examines the timeline for what's Known as the Ben banki problem for those Unfamiliar Ben banki was a leading American economist IST who served as the 14th chairman of the Federal Reserve Between 2006 and 2014 that same position That our buddy Jerome Powell fills today Anyhow Ben banki presents an example of Pro-social lying that most economists Would agree was warranted that's because His position was critical during the Buildup to the 2008 financial crisis It's worth noting here by the way that The author points out that the case for Lying doesn't just apply to Central Bankers and that the same arguments can Be made for economists in every sector Around the world anyway despite Worsening economic conditions bank's

Tone in the early months of the Financial crisis was increasingly Positive on the 15th of May 2008 he Spoke at the 44th annual conference on Bank structure and competition where he Was very open about the potential of Financial risks he explained that Financial turmoil had started the Previous summer and that this had raised Questions about the regulation of Institutions and their ability to Maintain Financial stability he pointed Out that increasing housing valuations Were disguising a rise in less than Ideal mortgages saying that while house Prices increased the equity of borrowers Increased and they were often able to Refinance into more sustainable Mortgages however when prices went down People found themselves trapped with Mortgages they couldn't afford now Obviously this was a cause for concern So you'd think that when the situation Got worse banki would have had an even More gloomy Outlook well he didn't on The 3rd of June 2008 just two weeks After that conference banki reported to The international monetary conference he Said that the economic situation Reflected the unwinding of the housing And credit booms and that there was Continued pressure from the global Demand for Commodities he explained that The FED had eased monetary policies

Substantially in order to address the Rapidly deteriorating conditions he even Said that quote for now policy seems Well positioned to promote moderate Growth and stability over time then that Same week on the 9th of June banki Discussed Financial uncertainty as if it Were nothing more than a momentary Hindrance in fact he began his Discussion by talking about the Prospects for growth he said that Despite the rise in the unemployment Rate data suggested that it would only Have a modest effect on the economy he Then acknowledged that economic activity In that quarter looked weak but insisted That the longer term risks had Diminished over the last month or so he Even suggested that thanks to fiscal Stimulus the remainder of 2008 should See some progress in the repair of Financial markets although he did again Raise housing as a concern along with The rise in energy costs in July banki Presented the Fed semiannual report on Monetary and economic policy to the House Financial Services committee where He assured everyone the government Sponsored Enterprises or gses were in no Danger of failing this was obviously Untrue because two weeks after that Warren Buffett signaled his concerns About gsse and just a month later the Government ended up bailing two of them

Out Fanny May and Freddy Mack now Obviously the rest of 2008 ended up Being pretty damn grim particularly After Layman Brothers filed for Bankruptcy in September and triggered a Global Panic marking the peak of the Financial crisis however the author Notes that during the buildup to this Crash bank's speech became notably more Strategic and performative rather than Descriptive now it's obvious that banki Was right to deceive despite the Financial system crumbling around him he Displayed confidence in that sense his Comments were not truthful they were Decep ceptive but this was necessary to Prevent the crisis from worsening the Author notes that here and in other Similar situations deception takes the Form of strategic speaking in terms of Central Bankers their speech can be Viewed as forward guidance for the Economy this opens the door to further Pro-social lying even in non-critical Moments that's because Central Bankers Can use strategic speaking to influence The economy both privately and publicly To to produce a particular result this Includes lawmakers investors influential Economic actors and the general public The question is how much influence does This strategic forward guidance have now The purpose of strategic speaking is not To inform but to bring about a variety

Of effects for example Central Bankers Could say that the economy is stable not Necessarily because they believe it's True but because it's a method of Maintaining that stability the author Notes that a central Banker strategic Speech is ethically complex for a number Of reasons first the truth of these Strategic statements depends on their Effects which can't be known for certain At the time that's why when a central Banker says that the economy is stable What they're really saying is please act In the belief that the markets are Stable if they literally said this it Would cause disbelief and panic which Would ironically cause instability Secondly as we discussed earlier Pro-social lying is both coercive and And paternalistic as they intend to Alter behaviors based on Deception Rather than discussion therefore it Denies a person of the right to make Well-informed decisions of their own This is an instance of the dirty hands Defense where an agent will disregard Moral values to bring about a more Important social good however the Defense of this lying must demonstrate That the goal justifies this ethical Disregard and must be within the Economic professional's Authority this Was the case with medical professionals That we mentioned earlier thirdly and

Perhaps most importantly this deception Raises further questions are other Economists licensed to deceive in the Same way will the more ethically mind Minded economists need to continue these Lies to avoid causing economic confusion And what types of lies are even Permissible in the first place the Author points out that as philosopher Cella Bach warns us deception regarding The level of UNC certainty is one of the Main ways to gain power over the choices Of the deceived this is something the Author notes as probably the most common Form of deception in economics and one That shouldn't be taken lightly Naturally this only raises more Questions what other ways can economists Deceive would it be acceptable for an Economist to exaggerate the good of Their policies and the negatives of Others what if an economic consultant Deliberately cherry-picks the Information to present to others while Deliberately leaving out other policy Options and what if the economists Tamper with statistical findings but Fail to report it honestly we've almost Got enough questions for a game of Who Wants To Be A Millionaire albeit a Rather highbrow one but it's that last Question that is arguably the most Concerning that's because a government Economist is responsible for presenting

Data for a whole range of things Including consumer confidence job Creation inflation unemployment trade Balances and many more economic Indicators besides therefore would it be Acceptable for government economists to Misreport this data if they believed it Would promote a more beneficial Objective as the author points out you Only have to look at China which is Widely believed to routinely push Fabricated data in order to sustain Foreign investment and political and Economic stability the author speculates That economists would be disturbed by The prospect of central bankers and Government economists fabricating data In this way even if it were done for the Right reasons again though this raises The question of where we draw the line Well as the author somewhat bleakly puts It quote I am aware of no viable ethical Standards that supports the drawing of Those lines nice no matter though Because it looks like economists have Figured out where to draw those lines For themselves that's because according To the author economists feel validated And empowered when they're in on the lie But they're intolerant if they're the Ones being duped ah the irony instead They'd prefer a free rider status where They can enjoy the benefits of lying but Without the risk of being lied to in

Other words being a part of an elite Club that has access to Insider Knowledge the thing is as tempting as it Is to think that this elite club Only Provides risks from high-profile Economists the fact is that even lower Level economists can affect the lives of Thousands if not millions of people all At once Now the author says that during his Research he's interviewed many Economists a recurring theme with many Of them was that they were pressed into Doing work that was deeply inefficient Or even completely false many of them Were expected to produce reports that Supported decisions that had already Been made the author notes an example of One Economist who is a member of the Council of economic advisors which Advises the president of the United States this person was instructed to to Produce an estimate of the balance of Payments impact of a West Coast dock Strike for a court injunction set to Take place the following morning they Were told that the legally specified Basis was a demonstration of a National Emergency no pressure then a now in this Instance the economist was pushed to Produce what's known as usat's economic Analysis for reference the word urat Comes from the German word for Substitute or imitation so in other

Words it was deemed necessary to use Fake analysis knowing this analysis is Fake makes it almost impossible to Maintain trust this is especially true When it's work that the economists Themselves don't believe in however this Person wasn't the only one the author Also notes that several interviewees had Stories of their own where they had to Sacrifice truth in order to alter the Behavior of other economists and Market Participants heck the author even says That some of them literally told him That you can never trust a government Economist or any economic consultant in Some cases these economists say that They were quote forced to speak more Loudly on issues than they otherwise Would have in order to sustain the Support of their funders or in an effort To fire back at other economists at the Other end of the political Spectrum the Author concludes by saying that speaking To these economists reveals that Deception is not only occasional but It's actually routine the problem is if The profession continues to tolerate Lying it risks losing its legitimacy Even among other economists in fact the Author points out that it could lead to Hostility and if that were to happen the Profession would deserve not to be Trusted now the author wraps up this Paper with a few closing thoughts on

What can be derived from it to start Though he begins with what we can't Derive while it's hoped that we can Determine a clear line between between What makes pro-social lying legitimate Or not we simply can't it remains Entirely up to the profession to decide What's acceptable and what isn't he then Raises his own concerns he notes that When an economist claims to lie for the Good of others they presume to know what It is that others value he then Reiterates that deception denies people Of their own autonomy and erodes trust Between non-economists and even fellow Members of the profession he finishes by Saying that deception in economics is a Huge contributor to the loss of trust in Expertise and is a common feature of the Problems with politics and this Rejection of expertise has even proved To be catastrophic particularly with the Pandemic recall that this paper was Written in 2020 so that's what the paper Has to say but what does this mean for The markets or indeed the average person Well in terms of what could change not Much that's because it's clear that both High-profile and lowprofile economists Have the ability to manipulate the Economy as they see fit and that's Arguably one of the most powerful tools To have at one's disposal the likelihood Of this changing anytime soon is

Virtually non-existent but what it does Mean is that we now know to interpret an Economist pronouncements with greater Scrutiny so the next time Jerome Powell Says everything's fine you'll know that This could mean that actually Everything's not fine and he's just Trying to keep things together seriously Folks take everything that people like This say with a massive pinch of salt What is clear is that the level of trust That people have in these experts has Collapsed and continues to decline while Economists Echo the words of Margaret Thatcher in saying that quote there is No alternative people are waking up to The fact that this is far from the truth While it is clear that pro-social lying Can achieve immediate results this is a Very short-term way of thinking that's Because this deception can cause its own Problems working with skewed data will Naturally throw up skewed results and Logically this can't be sustainable in The long run this means that either the Financial system collapses which could Actually be the lesser of two evils Because the alternative is that Society Breaks and the Very people who Economists deem fit to deceive push back And start a rebellion at that point it Won't matter what the profession says It'll be too little too late but let's Hope that this somewhat nightmarish

Future doesn't come to fruition with a Bit of luck economists will read the Room see the angry faces staring back at Them and start telling it like it really Is okay folks that's all for today's Video so if you found it interesting let Us know by Smashing that like button if You want to get more interesting content Like this subscribe to the channel and Ping that notification Bell and if you Know someone who would find this video Interesting as well take a second to Share it with them as always thank you For watching and we'll see you next time This is Guy signing off [Music]