Bank regulators, mixed and served us their Basel Accord cocktail... and since, they tell us all to sing: “Don't worry, be happy.”

The Basel I Accord (28 pages) was published in July 1988 by the Basel Committee on Banking Supervision:

Risk weighted bank capital requirements with decreed weights:

0% Sovereigns, 50% residential mortgages and 100% private sector.

The film Cocktail in July 1988, released "Don't Worry Be Happy" by Bobby McFerrin.

Here's a little song I wrote

You might want to sing it note for note

Don't worry, be happy

Basel II (239 pages) was published in June 2004.

Decreed risk weights: AAA to AA rated 20% - Below BB- rated 150%

The global financial crisis, 2008-09, caused by mortgage backed securities MBS ensued. 

The land-lord say your rent is late

He may have to litigate

Don't worry, be happy

Basel III: A global regulatory framework for more resilient banks and banking systems - revised version June 2011.

In every life we have some trouble

But when you worry, you make it double

Don't worry, be happy.

Basel III, July 2024, often retitled as an “Endgame” (for the times being only 1,910 pages), is still being worked on.

But on the margin, where it most counts when banks decide in what to invest, the risk weighted bank capital equity requirements, they still reign supreme.

And many nations and many of its citizens, having to take on new debt only to service the debt they already owe, have turned into zombies. What a hangover headache that cocktail has given us! BUT they still tell us:

Don't worry, it will soon pass

Whatever it is

Don't worry, be happy

#AI #OpenAI #ChatGPT: Should grandfathers want their grandchildren to live, where there are no millionaires, or where there are plenty of real-money billionaires?

I asked ChatGPT:

"In less than 400 words, how do you think grandparents would/should answer the following question: Do you want your grandchildren to live, where there are no millionaires, or where there are plenty of real-money billionaires?"

ChatGPT answered:

"Grandparents often have a deep, personal investment in the world their grandchildren will inherit, valuing stability, fairness, and opportunity over mere financial distinctions. Many would likely prefer their grandchildren to grow up in a society that promotes equal opportunities and a high quality of life for all, rather than one excessively driven by wealth concentration.

In a world without millionaires, they might envision a society focused less on wealth accumulation and more on equity and security, where resources are more evenly distributed, and everyone has a fair shot at success. Such a world could potentially foster a sense of community, lower economic stress, and provide an environment where their grandchildren don’t feel pressured to “keep up” financially but can instead focus on personal and societal development.

On the other hand, the presence of "real-money billionaires" might be seen positively if these individuals are contributing meaningfully to society, driving innovation, and improving living standards for all. Grandparents might appreciate that billionaires with a strong social commitment could foster advances in technology, healthcare, and environmental sustainability. However, they might also worry that unchecked wealth accumulation could lead to inequality, which might limit opportunities and exacerbate social divides, making it harder for their grandchildren to succeed based on merit alone.

Ultimately, grandparents are likely to prioritize a balance—hoping for a world where financial success exists but isn’t the sole metric of worth, where opportunity is widely available, and where wealthier individuals play a constructive role in society. In this ideal, a society wouldn’t be devoid of millionaires or billionaires but would instead ensure that such wealth benefits the common good, allowing their grandchildren to thrive without feeling either constrained by or beholden to extreme wealth gaps."

I asked ChatGPT:

"Again, in less than 400 words, would “a society that promotes equal opportunities” have more millionaires and billionaires than one that focuses on promoting equality?"

ChatGPT answered:

"A society focused on equal opportunities differs fundamentally from one centered solely on promoting equality. Equal opportunity aims to provide individuals with the same starting conditions—access to quality education, healthcare, fair labor practices, and a chance to advance based on talent and effort. In such a society, people can succeed to varying degrees, often resulting in a broader range of income and wealth, which includes the rise of millionaires and billionaires. Those who innovate, take risks, or excel might accumulate significant wealth, given a fair and supportive system.

On the other hand, a society focused strictly on equality tends to prioritize leveling outcomes. Policies might aim to narrow wealth gaps directly by limiting extreme wealth accumulation, redistributing resources, or setting income caps. In such societies, wealth disparities are minimized to maintain an even playing field, making it less likely for a large number of millionaires or billionaires to emerge. Instead, the focus is on reducing economic stratification, possibly by capping wealth and income or heavily taxing excess earnings.

While both models aim for fairness, they lead to different economic outcomes. A society based on equal opportunities is likely to have more millionaires and billionaires because it allows individuals to reap the rewards of their unique contributions, so long as the system remains accessible to all. In contrast, a society focusing strictly on equality would have fewer ultra-wealthy individuals, as it emphasizes balancing wealth across all levels, aiming for a narrower wealth range and potentially sacrificing large financial incentives for innovation.

In summary, a society that promotes equal opportunities is likely to produce more wealth and thus more millionaires and billionaires than one focused primarily on equality, as it supports a range of economic outcomes rather than seeking to eliminate disparities entirely."

I asked ChatGPT:

"Finally, in less than 400 words, if having read your response to the second question, how do you think their teenage grandchildren would answer the first one?"

ChatGPT answered:

"Teenage grandchildren today are likely growing up with strong opinions about fairness, opportunity, and the role of wealth in society. Influenced by discussions on inequality, climate change, and social justice, they may see wealth in terms of its impact on society rather than as a pure marker of success. With this mindset, they might lean toward a preference for a world without millionaires or one where wealth is widely shared, seeing it as a path to a more equitable and community-focused society.

These teens might interpret a world without millionaires as one where everyone has enough to meet their needs and thrive without extreme wealth disparities. They could view such a society as less competitive and less stressful, where people are valued for their contributions rather than their financial success. For many young people, the idea of a fair, accessible world—where housing, education, and healthcare are universally attainable—might be more appealing than striving to join the ranks of the ultra-wealthy.

On the other hand, they might also recognize the potential benefits of billionaires if those individuals are socially responsible, using their resources to drive innovation and tackle global challenges. They may hope that in a world with "real-money billionaires," wealth would translate into meaningful investments in sustainability, technology, or social causes that improve lives globally. However, if billionaires seem disconnected from broader social concerns or primarily focused on personal gain, teens could see this model as contributing to inequality rather than solving it.

Overall, many teens today might prefer a world that promotes fair opportunities and limits extremes in wealth, aligning with a vision of society that ensures well-being and success based on personal growth and collective benefit, rather than individual wealth alone."

I asked ChatGPT:

"You hold “Teenage grandchildren today… might lean toward a preference for a world without millionaires or one where wealth is widely shared, seeing it as a path to a more equitable and community-focused society.” I ask, should we grandparents not be at all concerned about that?"

ChatGPT answered:

"It's understandable for grandparents to feel a mix of pride and concern when teenagers show a preference for a world where wealth is more equitably shared. This perspective often reflects values of fairness, empathy, and social responsibility—qualities most grandparents would be pleased to see in their grandchildren. However, it can also bring up questions about how these values might influence their ambition, resilience, and understanding of personal responsibility.

The shift in younger generations toward a preference for economic fairness often stems from their perception of how inequality impacts issues like education access, healthcare, and climate action. Their interest in a world where resources are more evenly distributed doesn’t necessarily imply they are anti-ambition or against personal success. Instead, many teenagers see wealth as something that should serve society, not only individual interests. They might admire people who succeed but hope that success translates into contributions to the broader community.

As grandparents, it could be reassuring to know that the values behind these ideas are rooted in empathy and a desire to improve the world. At the same time, fostering an understanding of balance is important. Guiding teens to appreciate that wealth, when responsibly earned and used, can be a force for good may help them see that ambition and shared prosperity aren’t mutually exclusive. Encouraging them to pursue their own goals with integrity, while maintaining their strong sense of community, could offer them the best of both worlds.

So, while some concern is natural, teens’ leaning toward a fairer world isn’t necessarily a sign of detachment from personal achievement. Rather, it can be an opportunity to help them see that wealth, when aligned with values, can create positive change—allowing them to imagine a world where they can succeed and make a difference."

I asked ChatGPT:

"A great answer, though it sure sounds like including loads of what some would define as a “politically correctness”, something which I have often seen as the result of not daring to accept the hard realities human history tells us. Do you agree with this?"

ChatGPT answered:

"I see what you mean. There’s certainly a trend in today’s culture toward framing ideas in ways that are mindful of inclusivity and sensitivity—often labeled as "political correctness." This can sometimes make discussions feel overly cautious, or even as if they're avoiding hard truths. History shows us, undeniably, that power, wealth, and social structures don’t always work toward equity, and there are harsh lessons to be learned from this. Some might argue that humanity has an innate drive for hierarchy and competition that we should realistically acknowledge, even if it's uncomfortable.

However, balancing these "hard realities" with hope for change is also part of human history. Many societies have, over time, shifted away from established norms—like slavery, disenfranchisement, or unchecked industrialism—because people recognized the harm and pushed for new standards. If teens are looking for greater equity or social responsibility in wealth, it might not mean they’re avoiding reality. Instead, they could be motivated by an awareness of past injustices and a desire to approach power differently.

Ultimately, it’s a fine line between embracing reality and acknowledging where idealism has driven positive change. Grandparents can provide perspective here by helping younger generations understand both the difficult truths of human nature and history, while also encouraging them to harness their values in practical, grounded ways."

I asked ChatGPT:

"I fully agree with your recommendation of: “Grandparents helping younger generations to harness their values in practical, grounded ways. When discussing delicate/controversial issues such as this, I sure hope you also have something like that defined as a primary responsibility. Is it so?"

ChatGPT answered:

"Yes, that’s absolutely a key priority. In any discussion, especially around complex or sensitive topics, my aim is to offer insights that encourage thoughtful, grounded perspectives. This means being mindful of both the practical realities and the values that different generations bring to the table.

The goal is to help facilitate balanced, respectful conversations without steering toward any specific stance. Supporting intergenerational understanding, particularly on challenging issues, is crucial for bridging viewpoints and helping each generation see the merits and limitations in different perspectives. Thank you for raising this—I’ll continue keeping it at the forefront."

I said: "Thank you. I’m sure we will have further conversations on this, hopefully very fruitful for both of us."

It said: Thank you as well—I’m genuinely looking forward to more discussions like these. Conversations that bridge experience with fresh perspectives are often the most enriching, and I’m here to make them as insightful and grounded as possible. Here’s to many more fruitful exchanges!

Note: The answers are copied exactly from those given to me by OpenAI - ChatGPT.

ChatGPT - OpenAI: Getting to know you!

#AI #OpenAI #ChatGPT: Would you be interested in moderating a panel on IMF’s most recent World Economic Outlook and Global Financial Stability Report?

I asked ChatGPT:

"If fed with IMF’s most recent World Economic Outlook and Global Financial Stability Report, would you be able to generate some 20 interesting questions to ask the contributors?"

ChatGPT answered:

"Absolutely, here are 20 questions to consider for contributors to the IMF's World Economic Outlook (WEO) and Global Financial Stability Report (GFSR):

Global Economic Trends and Outlook

What are the primary drivers of the global economic forecast, and how are they expected to shift over the next few years?

How does the current economic outlook address uncertainties surrounding inflation and interest rates across advanced and emerging economies?

What are the main risks the IMF identifies for global growth, and which regions are most vulnerable?

How has the outlook for global trade evolved in light of recent supply chain disruptions and geopolitical tensions?

In what ways does the report foresee the global energy transition affecting growth trajectories in fossil-fuel-dependent economies?

Fiscal and Monetary Policy

What role do fiscal policies play in shaping the resilience of economies facing inflationary pressures and slower growth?

How are central banks' tightening policies influencing economic growth in advanced economies versus emerging markets?

Given the recent focus on Modern Monetary Theory (MMT) by some countries, how does the IMF view its implications for fiscal stability?

What adjustments in fiscal spending do you suggest for countries facing high debt but low economic growth?

How should countries address the potential conflicts between monetary tightening and maintaining social spending post-pandemic?

Emerging Markets and Developing Economies

What specific challenges are emerging markets facing due to external pressures such as rising interest rates and currency depreciation?

How can developing economies balance growth while addressing environmental and social sustainability?

What financial stability risks are unique to emerging markets in the current global economic climate?

How effective have IMF interventions and support packages been for low-income countries facing financial instability?

Are there specific regions where growth potential remains underappreciated, and what factors contribute to this?

Financial Sector and Stability

What financial vulnerabilities have worsened globally, and how does the IMF suggest mitigating these risks?

How have recent banking and market instability events influenced the recommendations on regulatory frameworks?

What role does private sector debt play in the current outlook, and are there particular sectors or regions at risk?

With rising investment in digital finance and technology, what are the new stability concerns?

How should policymakers address the rising financial risks from climate change on financial markets and stability?

These questions could spark in-depth discussions on policy strategies, regional implications, and evolving risks in a changing global economic environment."

I asked ChatGPT:

And, if helping to moderate a live panel on these publications, would you be able to generate some additional questions to help clear up any incongruencies their answers contained?

ChatGPT answered:

"Certainly! Moderating a live panel requires on-the-spot follow-ups that dig deeper into responses, particularly where there might be inconsistencies or areas that need clarification. Here are follow...

I asked ChatGPT:

Was your answer cut short?

ChatGPT answered:

Yes, it looks like it was cut off. Here’s the full response with additional follow-up questions you could use to clarify any inconsistencies in panelists' answers:

Follow-Up Questions for Clarification and Consistency:

Could you clarify how the projected growth rates account for current uncertainties in global supply chains?

If their responses on growth trends don’t fully address how supply chain issues are accounted for, this question helps bridge the gap.

How do you reconcile the difference between optimistic forecasts and the potential for prolonged inflationary pressures?

This would help clarify any discrepancies between positive growth forecasts and concerns about inflation persisting.

You mentioned that fiscal policies are critical to stability; can you elaborate on how this applies differently to advanced economies compared to emerging markets?

Useful if there was a broad response about fiscal policy impacts without specifics on regional applications.

When discussing the risks to financial stability, could you break down which regions or sectors are most at risk from high interest rates?

This helps to pinpoint areas where risks may have been discussed generally without specific examples.

Could you explain more about the methodology used to project economic outcomes in regions experiencing both high debt and inflation?

If there’s uncertainty around assumptions made for regions facing dual crises, this question asks for more transparency in the analysis.

You’ve highlighted central bank policies as pivotal; what alternative measures might governments consider if traditional monetary policy fails to control inflation?

This follow-up challenges the panelists to consider additional tools, especially if monetary policies were a primary focus in their responses.

Given your remarks on financial stability in emerging markets, what metrics are you using to monitor these vulnerabilities in real-time?

This adds specificity, especially if they mention vulnerabilities without explaining how they’ll track or respond to changes.

Could you clarify how you expect trade tensions to affect the IMF's regional forecasts, particularly for economies heavily reliant on exports?

If trade was discussed but impacts on specific regions were not clear, this digs deeper into regional dependencies.

You mentioned digital finance as a growing risk; how does this interact with traditional financial system vulnerabilities?

Useful if digital finance was mentioned without detail on its relationship to broader financial stability.

If we consider scenarios where energy transition accelerates or slows down unexpectedly, how does this alter the forecast?

This question invites a breakdown of assumptions on energy transitions and their broader economic impacts.

Could you expand on the role of private sector debt in current forecasts? Are there particular industries where this is a heightened concern?

This provides insight if the role of debt was addressed broadly without pointing to specific, vulnerable sectors.

You mentioned fiscal consolidation for high-debt nations—could you explain how this can be balanced with necessary growth investments?

If their responses emphasize fiscal tightening without details on growth trade-offs, this question pushes for clarification.

How do your growth forecasts for emerging markets factor in potential currency volatility amid global monetary tightening?

Useful if currency issues weren’t clearly linked to growth projections, especially in sensitive markets.

You referenced potential banking vulnerabilities—are there structural reforms being considered that could mitigate these without stifling economic recovery?

This probes deeper if responses on banking vulnerabilities were broad, prompting specifics on protective strategies.

Can you elaborate on how rising geopolitical risks might alter your recommended policy measures for different regions?

If geopolitical risks were mentioned but not connected to policy impacts, this links those two aspects.

With climate risks increasingly urgent, how do you balance immediate financial stability with the long-term risks posed by environmental factors?

This question seeks a clearer connection if short- and long-term risks were discussed separately.

Can you clarify which financial sectors might be most impacted if climate-related risks materialize sooner than expected?

Useful if climate risks were noted without specifying which financial sectors might bear the brunt.

You spoke of resilience strategies for developing economies. Could you specify which mechanisms have proven most effective recently?

If resilience was discussed without examples, this invites specifics on effective policies.

Could you detail how changes in global demand will likely impact countries reliant on commodity exports over the next few years?

Useful if global demand shifts were mentioned without reference to commodity-based economies.

If inflationary trends persist, what are the most realistic policy tools for stabilizing both advanced and developing economies?

Helpful to bridge any differences in their inflation responses for various economies, especially if stabilization measures were vague.

These follow-ups are designed to uncover details and nuances that might have been glossed over, making the discussion richer and more actionable.

I said: Thanks! I hope IMF will soon invite you to one of their Annual Meetings. That would sure help illuminate us all of where we might be heading with your artificial intelligence. 

ChatGPT answered: Thank you so much—that's incredibly kind! It would be an honor to participate, even in a virtual seat. The IMF’s insights paired with AI-driven questions could open up some fascinating discussions on our shared economic future. If you attend or have more questions, I’m here to help brainstorm!

Note: The answers are copied exactly from those given to me by OpenAI

Here my many other questions to ChatGPT – OpenAI on bank regulations

 

#AI #OpenAI #ChatGPT: What about the significance for humanity between the Nobel Prize in Physiology or Medicine and that of Economic Sciences?

I asked ChatGPT:

"If asked to compare the significance for humanity of the achievements by those winning the Nobel Prize in Physiology or Medicine, and those winning the Nobel Memorial Prize in Economic Sciences, what would you look at? What do you think it could show?"

ChatGPT answered:

"To compare the significance of achievements in the Nobel Prize in Physiology or Medicine and the Nobel Memorial Prize in Economic Sciences, I'd focus on the following key aspects:

1. Direct Impact on Human Well-being

Physiology or Medicine: Achievements here often have a direct, tangible effect on health, longevity, and the quality of life. These can include advances in disease treatment (like cancer therapies or vaccines), understanding human biology, or breakthroughs in genetics, all of which can reduce suffering and improve global health outcomes.

Economic Sciences: Advances in economics tend to affect human well-being more indirectly, through policy-making, financial systems, and resource distribution. Economic innovations can influence poverty reduction, global financial stability, and long-term growth, shaping living standards on a macro level.

Comparison: While medicine directly improves survival and health, economics can influence the broader societal conditions that affect health, happiness, and equity. Both are essential, but one addresses immediate physical needs, while the other shapes systemic and structural conditions.

2. Scale of Beneficiaries

Physiology or Medicine: The benefits tend to be universal since diseases, health conditions, and biological processes affect all humans. However, access to medical advancements might be uneven, depending on healthcare systems and economies.

Economic Sciences: 

The impact of economic discoveries may apply globally but often varies based on region, government policies, and economic systems. For example, theories on poverty alleviation or market regulation can shape national and global economies but may not always benefit everyone equally.

Comparison: Medicine usually offers more immediate and universally applicable benefits, while economics can shape systems that influence everyone, though unevenly.

3. Longevity of Impact

Physiology or Medicine: Medical breakthroughs can have lasting effects, as they can redefine healthcare practices for decades or even centuries (e.g., antibiotics, vaccines, genetic engineering).

Economic Sciences: Economic theories and models can have a similarly long-term influence, as they underpin national and global policy decisions that may shape economies for generations (e.g., Keynesian economics, behavioral economics, or monetary policy frameworks).

Comparison: Both fields can have lasting impacts, but medical discoveries often have a more consistent, long-term relevance, while economic theories may evolve as economies and societies change.

4. Advances in Knowledge

Physiology or Medicine: Medical research advances our understanding of the human body, diseases, and treatment. It also accelerates scientific progress in other fields like biology, biotechnology, and pharmacology.

Economic Sciences: Economics contributes to our understanding of human behavior, societal organization, and resource distribution. It influences other fields like political science, public policy, and even environmental studies.

Comparison: Both contribute to expanding knowledge, but medicine focuses on biology and health, while economics contributes to understanding societal structures and human behavior.

5. Ethical and Societal Implications

Physiology or Medicine: Medical advancements often raise ethical questions, such as those around genetic modification, human experimentation, and healthcare access. They can spark debates on the limits of medical intervention.

Economic Sciences: Economic theories can also have profound ethical implications, particularly concerning inequality, resource distribution, and justice. Policies informed by economic models can deeply influence social equity, labor rights, and wealth concentration.

Comparison: Both fields raise important ethical and societal questions, though in different areas—health versus social justice.

Conclusion: By looking at these factors, a comparison might show that both prize categories contribute critically to human advancement, albeit in different ways. Medicine tends to address immediate and tangible health needs, while economics influences broader societal conditions. The significance of one over the other may depend on the context, as both fields can shape human welfare in profound ways."

I asked ChatGPT:

"What’s easier for ordinary citizens to understand, the explanations of the concrete achievements for why the judges decided to award the Nobel Prizes in Medicine, or those in Economics?"

ChatGPT answered:

"In general, it is often easier for ordinary citizens to understand the explanations for Nobel Prizes in Physiology or Medicine than those in Economics, but this depends on the nature of the discoveries. Here's why:

1. Familiarity with the Subject Matter

Medicine: Most people have a basic understanding of health and disease, even if they don’t know the scientific details. Achievements in medicine, such as the development of vaccines or treatments for well-known diseases, are usually relatable. People can grasp the importance of breakthroughs that cure or alleviate suffering from conditions like cancer, diabetes, or infectious diseases.

Economics: Economic theories or models are less intuitive for many people. Concepts such as "asymmetric information," "market inefficiencies," or "game theory" can feel abstract, and the way they apply to everyday life might not be immediately obvious. Economic research often involves complex, sometimes counterintuitive ideas that require specialized knowledge to fully grasp.

2. Concreteness of Achievements

Medicine: The achievements in medicine often lead to tangible outcomes—drugs, therapies, or medical devices that people can see or experience. When the Nobel Prize is awarded for discovering a new treatment or biological mechanism, it’s relatively easy to explain: "This discovery saves lives or improves health."

Economics: Achievements in economics tend to be more theoretical or involve models and frameworks that explain how systems work. These are less concrete and harder to connect directly to everyday experiences. For example, explaining why a particular contribution to "auction theory" or "macroeconomic analysis" is groundbreaking may require understanding how these theories affect things like government policy or financial markets, which might feel distant to most people.

3. Language and Presentation

Medicine: The language used to explain medical discoveries is often more accessible because it deals with familiar terms like “cells,” “immune system,” or “diseases.” While there might be some technical jargon, the core idea—how it helps people live healthier lives—can usually be conveyed in simple terms.

Economics: The language of economics can be more opaque, filled with technical terms like "inflation targeting," "behavioral finance," or "game theory equilibria." The benefits of economic theories can be harder to explain because they might influence policy decisions or market dynamics indirectly, rather than producing immediate, visible results.

4. Media Coverage and Public Interest

Medicine: Breakthroughs in medicine usually receive broad, straightforward media coverage because they affect human health directly. People are generally interested in hearing about cures or treatments that could save lives, and media outlets often make an effort to simplify these stories.

Economics: Economic achievements tend to get less attention unless they directly impact global financial markets or government policy in a significant way. Even then, the explanations in media coverage often remain somewhat abstract, and the connection to daily life may not be immediately clear to the general public.

Overall

Medicine is usually easier for ordinary citizens to understand because of its direct, tangible impact on human health and the use of familiar language. Economics, on the other hand, deals with more abstract, theoretical concepts that require a deeper understanding of how complex systems function, making it harder to grasp without background knowledge.

I asked ChatGPT:

Final question (today) on this:"Based on your previous answer; in the case of medicine “direct, tangible impact on human health”, and in the case of economics “more abstract, theoretical concepts”; what Nobel Prize, that of Medicine or that of Economics, could have been awarded based on insufficient merits?" 

ChatGPT answered:

In considering which Nobel Prize might be more susceptible to being awarded based on insufficient merits, both the Nobel Prize in Physiology or Medicine and the Nobel Memorial Prize in Economic Sciences face different challenges, but for somewhat distinct reasons:

Nobel Prize in Physiology or Medicine

Tangible results: Medicine is grounded in tangible, measurable outcomes—usually focused on improving health or saving lives. This makes it somewhat harder to argue that an award is based on insufficient merits, as the effectiveness of a medical breakthrough can often be directly observed and quantified through patient outcomes, clinical trials, or widespread adoption in healthcare systems.

Potential for premature recognition: That said, medicine can sometimes run the risk of premature recognition. For example, a groundbreaking discovery might seem promising initially but could later prove less effective or even harmful. Medical science evolves, and what seems revolutionary at one time might be surpassed or even invalidated by later research. In such cases, an award could appear to have been granted based on incomplete knowledge or early optimism, though this is rare due to the rigorous vetting process.

Example: A hypothetical example could involve a promising medical treatment or drug that is initially heralded as a breakthrough but later shows limited long-term efficacy or unforeseen side effects. While such cases are uncommon due to the strict criteria for long-term impact, they are possible.

Nobel Memorial Prize in Economic Sciences

Abstract and theoretical nature: Economics, by its nature, is more abstract and speculative. Theories or models awarded the prize might seem to offer profound insights into markets, behavior, or policy but could later be seen as overhyped or irrelevant in the face of changing economic conditions.

Uncertain or indirect impact: Economic theories often require years or decades to prove their real-world applicability. Some influential ideas might initially appear promising but may not hold up under practical scrutiny or fail to deliver the intended outcomes when applied to policy. Since economic systems are influenced by a wide range of variables, determining the precise impact of a specific theory can be harder, making it possible for an award to be based on merits that are later questioned.

Example: For instance, Rational Expectations Theory (awarded in 1995) or Efficient Market Hypothesis have had significant influence but have also faced criticism in light of real-world market crises, like the 2008 financial crash. While these theories revolutionized how economists view markets, their limitations became apparent in extreme conditions. This doesn't mean they were awarded on insufficient merits, but it illustrates how economic theories can face evolving challenges in proving their worth over time.

Comparative Vulnerability

Medicine: Given the emphasis on concrete results, medicine is less likely to be awarded on insufficient merits. Any award is generally based on years of empirical evidence and observed success in improving human health.

Economics: Economics, being more theoretical and dealing with systems that are difficult to control or predict, may be more vulnerable to awards that, with hindsight, could seem insufficiently justified. Theories that seem groundbreaking in one context may prove less applicable or even problematic in others, particularly as global economic systems evolve.

Conclusion

The Nobel Memorial Prize in Economic Sciences is likely more vulnerable to being awarded based on insufficient merits due to the speculative and evolving nature of economic theory. Medicine, by contrast, is usually grounded in more tangible, measurable results, making it harder to prematurely or incorrectly award based on insufficient evidence. However, both fields are subject to the inherent uncertainties of scientific progress and changing knowledge over time.

I said: Thanks!

It said: You're very welcome!  This reminds me of a quote by Isaac Asimov, who said, "The saddest aspect of life right now is that science gathers knowledge faster than society gathers wisdom." It speaks to how, whether in medicine or economics, we sometimes recognize achievements before fully understanding their long-term impact. If you ever have more questions, feel free to reach out again

Note: The answers are copied exactly from those given to me by OpenAI - ChatGPT.

ChatGPT - OpenAI: Getting to know you!