Even while driving, you’ve got to hit some bumps on the road.
I just thought of a way to explain to OP the difference between theory and the economy as a model of study and real-life application.
You can build a car that is perfect, it runs smoothly it can drive at any time anywhere, it has a billion sensors, the car will be great except the moment you're driving legally and carefully and a drunk driver is swerving on your line coming 200 km/h at you and totally destroys you!
It was not your fault, not your car's fault and nothing could have prevented this from your side of the story.
Same here, there is no way to prevent some of those things, if you go into 5 or 10 years bonds, how can you make sure
- a virus doesn't screw the whole economy
- a war doesn't start
- an asteroid doesn't hit the earth
- Hitler's grandson doesn't become president of Bartovia?
Then the economics formal theory and mathematical theory are now handicapped by impractical assumptions or directly contradicted by real world data.
2+2=4
Unemployment Rate= Total number of Unemployed / Total number of employed individuals.
Both of these are correct even if I spray my leg, even if my country is wiped by a nuke, 1000 years from now those formulas will still stand and will be right.
But if I take a loan of $100 a month and I have a wage monthly of $5000 everything works fine and there shouldn't be any problem unless I take up drinking and gambling I lose my job and I have no money and no willingness to pay back. This is no longer science, it's no longer theory, it's just shit that happens and and you can't know if will happen or not 10 years in advance because science doesn't do crystal globe readings.
What meltdown? The global economy is growing, global poverty is declining, developing countries are developing. We just recently had a global pandemic and we handled it quite well, it didn't become a Great Depression 2.0.
So far all the dooming about the repeat of 2008 crisis has been proven wrong. This of course doesn't mean that there will never be a crisis, but to say that the field of economics is useless and yielded no results sounds absurd to me. Today's economy seems more resilient because the hard lessons of crashes were learned.
It's the doom and gloom section, haven't you got used to it?