What we have in the West is a series of empires, each with its own cultural project… [The current empire] is the empire of Anglo-American technocratic capitalism, the economic and technological empire of the WEIRD (the western, educated, industrialized, rich, and democratic). And the cultural hegemony of this empire is what goes by the name of the “secular discourse” in Berger or “exclusive humanism” in Smith. — Charlie Clark, “Everything That Can Go On Is Going On,” Fare Forward (2015)

Rome owes her grandeur and success to the conduct of those who were tenacious of their religious duties; and if we compare ourselves to our neighbours, we shall find that we are infinitely distinguished above foreign nations by our zeal for religious ceremonies. — Cicero, On the Nature of the Gods (c. 45 BC)

I used to work in the scrap metal business. The first week of every month is The Trade, when the steel mills buy scrap for delivery over the next 30 days. The Trade is a lot of calling around: the mills’ buyers call the brokers who call the dealers, back and forth and back again. For the first few days, everyone is watching everyone else to see who will make a move. The mills try to tamp enthusiasm down; the dealers, to hype it up. The brokers side with the mills, because the mills are the powers that be, and the brokers get the same cut regardless of the price. Eventually, some big mill makes its buy for the month, and everyone else falls in line behind them. The whole market tends to move by some amount of dollars per ton, up $10, say, or down $20.

In advance of The Trade, rumors circulate about what the market will do. Reports from manufacturers and mining companies are enlisted to support predictions. But actually, the only predictable factor is bullish sellers and bearish buyers. It’s all posturing: everyone in the business knows that the movement of the market can’t actually be predicted. The AMM’s forecasts are just rhetorical ammunition—if prophecies, only the self-fulfilling kind. The Trade is a poker game. Everyone knows their hand; they can see the cards on the table. But you don’t play the cards, you play the guy across from you.

Sometimes, I’d try to explain this to peddlers. Because every month they’d badger me, “Hey, what’s scrap gonna do next month? I know you know something.” I’d try and explain: “If I knew what scrap was gonna do next month, we wouldn’t be having this conversation, because I’d be retired, living on a beach somewhere.” Knowing—really knowing—what the market would do next month would be like knowing tomorrow’s lottery numbers. Of course, I did know something—I knew small movements were more likely than large movements and I knew to hedge my bets—but what I knew would never come close to yielding a prediction.

So why did I spend so much time trying? Why did I collect data and arrange it in tables and track the historical movements of the market to try and chart its future? Why did I build models—naive models, I’m sure—and generate private forecasts? There was something almost ritualistic about these attempts at prediction; I thought about it as “doing my due diligence”—even though I didn’t really believe it could work. My data was junk, my techniques were unrefined: at the end of the day, I knew my predictions were phony. I traded on them anyway. The amazing thing was that it worked. My record was actually very good. 

My initiation into these secret rites must have occurred, osmotically, in college. My alma mater is one of junior members of a Northeastern athletic conference that produces a disproportionate share of our nation’s elites. A plurality of those future elites take a degree in the social sciences—economics being the queen of those sciences—and go on to earn staggering salaries making predictions about the movements of markets and the actions of corporations. Was there some scale at which data became more than the sum of its parts, at which, through sheer aggregation, it became more informative than my intimate knowledge of a single firm in a single industry? I wouldn’t know; I studied Classics.

[T]he record of social scientists as predictors is very bad indeed, insofar as the record can be pieced together. No economist predicted ‘stagflation’ before it occurred, the writings of monetary theorists have signally failed to predict the rates of inflation correctly (Levy 1975) and D.J.C. Smyth and J.C.K. Ash have shown that the forecasts produced on the basis of the most sophisticated economic theory of OECD since 1967 have produced less successful predictions than would have been arrived at by using the commonsense, or as they say, naive methods of forecasting rates of growth by taking the average rate of growth for the last ten years as a guide or rates of inflation by assuming that the next six months will resemble the last six months (Smyth and Ash 1975). One could go on multiplying examples of the predictive ineptitude of economists… — Alasdair MacIntyre, After Virtue(1981)

[M]acroeconomics, despite the thousands of highly intelligent people over centuries who have tried to figure it out, remains, to an uncomfortable degree, a black box. The ways that millions of people bounce off one another—buying and selling, lending and borrowing, intersecting with governments and central banks and businesses and everything else around us—amount to a system so complex that no human fully comprehends it. “Macroeconomics behaves like we’re doing physics after the quantum revolution, that we really understand at a fundamental level the forces around us,” said Adam Posen, president of the Peterson Institute for International Economics, in an interview. “We’re really at the level of Galileo and Copernicus,” just figuring out the basics of how the universe works…. Or put less politely, as Mr. Rudd writes in the first sentence of his paper, “Mainstream economics is replete with ideas that ‘everyone knows’ to be true, but that are actually arrant nonsense.” — “Nobody Really Knows How the Economy Works. A Fed Paper Is the Latest Sign.” The New York Times, 10/21/21