"And finally, no matter how good the science gets, there are problems that inevitably depend on judgement, on art, on a feel for financial markets"
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Feldstein’s line is a polite rebuke to the technocratic fantasy that markets can be fully mastered by models. Coming from an economist who moved easily between academia and Washington, it reads less like anti-science grumbling and more like a veteran’s warning label: even the best empirical machinery can’t repeal uncertainty, politics, and human behavior.
The craft is in how he pairs “science” with its opposite without insulting either. “No matter how good the science gets” nods to progress in econometrics, computing power, and data abundance, then quietly yanks the audience back to the messy present. The phrase “inevitably depend” does heavy lifting: he’s not claiming economists are lazy or that rigor is futile, but that certain decisions are structurally non-algorithmic. When variables change because people react to forecasts, when crises rewrite correlations overnight, “judgement” becomes less a soft virtue than a survival skill.
The subtext is also institutional. Policy makers, central bankers, and financial regulators routinely want cover: a model output, a rule, a “neutral” number that can be defended at a hearing. Feldstein insists the honest answer is often closer to taste than to theorem - an “art” shaped by experience, incentives, and the moral weight of who absorbs the downside when a call goes wrong.
“A feel for financial markets” is the most revealing clause. It’s both a concession (markets have a texture you learn by contact) and an implicit critique of economists who pretend distance equals objectivity. He’s staking out a grown-up humility: expertise includes knowing where expertise ends.
The craft is in how he pairs “science” with its opposite without insulting either. “No matter how good the science gets” nods to progress in econometrics, computing power, and data abundance, then quietly yanks the audience back to the messy present. The phrase “inevitably depend” does heavy lifting: he’s not claiming economists are lazy or that rigor is futile, but that certain decisions are structurally non-algorithmic. When variables change because people react to forecasts, when crises rewrite correlations overnight, “judgement” becomes less a soft virtue than a survival skill.
The subtext is also institutional. Policy makers, central bankers, and financial regulators routinely want cover: a model output, a rule, a “neutral” number that can be defended at a hearing. Feldstein insists the honest answer is often closer to taste than to theorem - an “art” shaped by experience, incentives, and the moral weight of who absorbs the downside when a call goes wrong.
“A feel for financial markets” is the most revealing clause. It’s both a concession (markets have a texture you learn by contact) and an implicit critique of economists who pretend distance equals objectivity. He’s staking out a grown-up humility: expertise includes knowing where expertise ends.
Quote Details
| Topic | Investment |
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