When an analyst is "shocked", is that usually a good sign?

[Torie]

No, it is a bad sign if they are competent analysts, who know how to measure uncertainty. It suggests an omega event, like the aftermath of Lehman Bros., which next to nobody predicted (almost all the financial institutions in US and Europe essentially failed, and were rendered insolvent).

[Torie]

Meteorologists have access to highly-accurate measurements of thousands of different variables, worldwide, in real time.  With this information, they are able to predict certain the values of certain variables (high/low temperature, humidity, dewpoint, etc.) in a given location for up to about 7 days.  After 7 days, the prediction of even the most sophisticated meteorological model loses any statistically-significant relation with reality.  Economists have access to questionable estimates of a few hundred different variables, in certain jurisdictions, months after the fact.  With this they claim they can predict the workings of the global economy for years or even decades.  This is blatant pseudoscience of the highest order.  It is mathematically impossible for any economic model to have any real predictive power (any data is too old to have predictive power for future data, and in any case even real-time data could only be useful for a matter of days).  Any accurate "modelling" would simply be the statement of a pseudo-tautology:  "When it's humid, it's likely to rain," would be a meteorological equivalent.

Time horizons matter. Accuracy in both economics and meteorology dramatically improves the shorter the time horizon. Random/the lower odds outcome, future events have a cumulative effect over time.

[Torie]

Economics teaches that future stock prices are unpredictable, around an expected trend line that goes up (if the expected trend line was going down, spot prices of course would go down until the trend line regained an upslope, since nobody invests for expected negative returns - except of course government, e.g. Solyndra). Having said that, behaviorists suggest certain additional complexities, but I digress.

[Torie]

Government faces the same risks and rewards as anybody else. The fact that government suffers losses (Solyndra) doesn't make it any worse than any private sector actor that occasionally suffers losses. The main difference is that economics does not allow for consideration of distributional questions, while such questions are at the center of governmental behavior.

Yes, but anyone underwriting a loan to Solyndra would have realized they would not get their money back. It was that bad. In another instance, the feds lent money to an outfit that had never sold a product (and no prospect that they ever will), then they sold some product to their Canadian subsidiary, and got a subsidy for doing that.  It seems that their main "product" is their political connections to the government.