The warnings of Professor von Mises (1971) carried no weight in the ECB Council:
The data which was being fed into the econometrics model on which the ECB prided itself, supplemented by the ECB’s analysis of the ‘second pillar’ of its monetary framework, did not produce any hint of serious recession risk ahead. Instead it was the amber or even red inflation light which was blinking!There is not, and there cannot be, such a thing as quantitative economics. The usual method employed in business forecasts is statistical and thereby retrospective. They depict trends that prevailed in the past and are familiar to everybody. They in no way answer the questions that all people, and especially businessmen, are asking. People know that trends can change; they are afraid they will change; and they would like to know when the change will occur. But the statistician knows only what everybody knows, namely, that they have not changed!
--Brendan Brown, Euro Crash: The Implications of Monetary Failure in Europe (Houndmills, UK: Palgrave Macmillan, 2010), 95-96.
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