 Hi, I'm Mark Thornton from the Mises Institute. Today, the Swedish Central Bank awarded the Nobel Prize in Economics to three American professors Professor Robert Schiller of Yale Professor Eugene Fama of Chicago and Professor Lars Peter Anderson also of the University of Chicago The award was given for their contributions to asset pricing Professor Schiller made correct predictions regarding the tech bubble and the housing bubble But he of course is coming from the behavioral finance Area where everything is the result of psychology Eugene Fama is famous for the efficient market hypothesis Which says all information all relevant information is already built into the prices of assets and that markets basically Can't go wrong because they contain all relevant information And so there really aren't any bubbles or any bust in the economy and of course that just doesn't seem to be true in reality Professor Lars Peter Hansen is an econometrician who's Developed new methods of statistical and empirical analysis That allow economists to study much more complex things and more complex environments Using simpler models. Unfortunately, this has given a lot of economists just that much more faith and empirical analysis and Less interested in studying the world as it truly is But most problematic Overall, I think is Robert Schiller and his contribution the notion that booms and bubbles are Just a matter of psychology as well as the fact that he actually did make a couple of correct predictions This leads people to believe that he is the way to go in terms of economic analysis But you know, everybody agrees that psychology is an element in markets both in the upward and downward direction But the Austrians show that it's money that matters that the Federal Reserve is the ultimate cause of the business cycle and Schiller completely denies that and as a result he Sets off with a bunch of policy recommendations where he doesn't recognize the central bank as the problem He actually thinks it's the first line of defense In economic booms and busts so for for that many other reasons his policy recommendations are to regulate everything in our daily lives and With the Austrians our view is that the Federal Reserve is the cause and yes indeed it does set off psychop psychological reactions but psychology is not the cause of the business cycle and More government regulation is not the key to solving the business cycle and that's the Mises view