Cred and Credulity

Three points from today's reading:

1. When something fails to work because of a wrong methodology, what most people do is not to question that methodology, but to apply it with even greater rigor. Thus MORE QE.

 2. (in similar spirit) focusing on the outcome of a complex process, rather than the process itself, will lead to unintended consequences. Inflation targeting during the tech bubble.

 3. Central management of a system is often inferior to self-regulation. Traffic lights increase fatality rate of pedestrians.