As I have mentioned in a previous post, Sleeping beauty the difficulties associated with watching a loved one in pain and not being able to help. I have come to realize that whenever someone’s expertise is sought in no matter what field there is very little certainty the more complex the condition.
I am not referring to a case where there are scientific tests where a pathology report can give a confirmed diagnosis. I am talking about those complex mosaics where the diagnosis comes from looking at many different variables. I know this first hand as my step-father is a doctor and I have listened to him describe how one digs deep into their experience and look for an intuitive edge when trying to make a diagnosis of a complex condition. He always says medicine is an “art and part science”.
The other day a certain condition presented to the doctor looking after my daughter that prompted us to consult a good friend of ours who is a pediatric cardiologist. Following a lengthy consultation it appears we may have come up with a rare condition diagnosis that could explain my daughters hell over the last 6 months. However, it isn’t so clear cut as that. The team of doctors on my sleeping beauties case are not all convinced with this new diagnosis.
When I think of the markets and the economy I used to think as a young university student that the answers were clear-cut in black and white. It seemed so obvious if inflation was at x level and interest rates at y that the obvious solution would be z. As I got older I realized that the variables I was considering were only the main ones, however each main variable had their own derivative branch of visible or psychological variables making for an infinitely complex system, that NO ONE EXPERT has the solution for all the outcomes. At this point of my epistemological journey I realized that one has to apply considered judgement to the complex.
Last Sunday I spent a few hours on a very important communal committee which required deliberating on a policy that would have far reaching consequences. The person who made the largest contribution to the deliberations was an active Judge of the Supreme Court. I was really impressed by the process in which he unpacked and then approached the issue.
This got me thinking about how we deal with decisions and express expert opinion without absolute knowledge. Like a judge who wasn’t at the scene of the crime, there is no way of knowing with absolute certainty (excluding cases where there was video footage, like the blood test for a doctor) who did what exactly. Rather the expert is expected to consider all the evidence and apply a test for reasonableness. I think we need to really view ourselves like judges when making a judgement call on the markets.