This article is part of a series of adapted excerpts from “Bitcoin Is Venice” by Allen Farrington and Sacha Meyers, which is available for purchase on Bitcoin Magazine’s store now[1].
You can find the other articles in the series here[2].
Modern academic economics is beholden to mathematics so complex, so obscure, and so removed from the reality it purports to describe and explain that it is effectively impervious to satire.[i]
It is Poe’s law[3] in departmental form. As investors, we, the authors, are professional capital markets participants. But in a past life, we were academically trained not in economics or finance, but in physical geography, environmental systems engineering, hydrology and water resources management, mathematics, philosophy, and computer science, across our various credentials. We believe this unusual combination of knowledge and experience gives us a worthwhile insight into why modern academic economics is such a comical disaster.
We think it is a vicious interplay of three factors, each as unfortunate as the last, each feeding and fed by the others. First: physics envy. This is well understood and is not an original insight. Second, a more specific, material effect of physics envy in this realm: It pushes academic economists to search for what can be measured and quantified, rather than what can or should be understood. Financial markets throw off torrents of data, particularly in recent decades with the advancement of computation and networked computers. Third, financial markets are positioned directly adjacent to the fiat spigot of artificial money. The metaphor may even be more accurate if expressed as financial markets being the spigot. There is no other channel by which counterfeit money can be or ever is pumped
