AI review: my article "My economic theories"

 

*** ChatGPT comment

 

Your article presents a well-structured and insightful analysis of economic trends, blending historical patterns with practical investment tools. It effectively covers key economic concepts while remaining accessible to a broad audience. Here are some strengths and areas for improvement:

 

Strengths

1. Clear Explanation of Economic Cycles
• Your breakdown of economic cycles and market lagging indicators helps demystify complex topics.
• Referencing Ray Dalio’s How the Economic Machine Works adds credibility.
2. Insightful Discussion on Market Predictions
• The critique of economists’ forecasting errors (e.g., Ben Bernanke in 2008) is a solid point, highlighting the challenge of predicting downturns.
• Recognizing the impact of unpredictable events like wars and geopolitical shifts adds depth to the analysis.
3. Practical Investment Tools
• The explanation of Simple Moving Averages (SMA) is useful for investors, particularly mentioning the Death Cross as a bearish signal.
• Providing specific indicators (SMA-350, SMA-50) offers actionable insights.
4. Macroeconomic Challenges & Cultural Influence
• Your discussion on aging populations, debt burdens, and productivity decline aligns with real economic concerns for wealthy nations.
• Exploring cultural influences on productivity (e.g., Confucian values and climate’s role in work ethic) adds a unique perspective.
5. Balanced View on Globalization
• You fairly present both the benefits (lower costs, global trade) and drawbacks (wealth gaps, environmental concerns).
• The example of China’s rise as a manufacturing powerhouse is particularly relevant.

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Areas for Improvement

1. More Nuanced Discussion on Economic Cycles
• You challenge the idea of an "End of the Economic Cycle" but could elaborate on why cycles persist. Are technological advancements or policy shifts reducing volatility?
2. Clarify Market Indicators
• The Death Cross typically refers to SMA-50 crossing below SMA-200, rather than SMA-20. A quick clarification would prevent confusion.
3. Expand on Reserve Currency and Inflation
• You mention excessive borrowing but could tie this more explicitly to concerns over U.S. dollar devaluation and inflation risks.
• How do reserve currency shifts (e.g., BRICS nations pushing alternatives) affect global markets?
4. Challenge the China Overtaking U.S. Prediction
• While China’s GDP may surpass the U.S., other factors (e.g., debt levels, demographic decline, innovation ecosystem) could slow its economic dominance.
• A brief mention of these counterpoints would add depth.

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Final Thoughts

Your article is well-structured, informative, and engaging. Strengthening the discussion on economic cycles, refining market indicators, and considering alternative perspectives on China’s rise would make it even stronger. Overall, a compelling read with valuable insights for both economists and investors.

 

*** DeepSeek comment

Overall Assessment

Strengths:
✅ Clear Framework: Breaks down complex topics (economic cycles, SMAs, globalization) into digestible sections.
✅ Real-World Examples: Bernanke’s 2008 misjudgment, China’s rise, and 2022 rate hikes ground theories in reality.
✅ Practical Tools: SMA explanations and "Death Cross" add actionable value for traders.
✅ Multidisciplinary Approach: Ties culture, demographics, and policy to economics (e.g., Confucian values, immigration).

Opportunities for Improvement:
🔸 Sharper Focus: Some sections feel disjointed (e.g., SMAs sandwiched between macro trends).
🔸 Depth on Key Claims: Needs data/citations for projections (e.g., China’s GDP surpassing the U.S.).
🔸 Originality: Heavy reliance on Dalio’s work—where’s your unique thesis?

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Section-by-Section Feedback

1. Understanding Economic Cycles

• Strengths:

  • Dalio’s video is a great resource, but clarify your takeaway.

  • Myth-busting ("End of Cycles" articles) is compelling.

• Suggestions:

  • Add a 1-sentence thesis (e.g., "Cycles are inevitable because human psychology drives over-leverage and correction.").

  • Cite historical cycles (e.g., 2000 Dot-com vs. 2008 Housing Crash patterns).

2. Why Economists Misjudge Markets

• Strengths:

  • Bernanke example is powerful.

  • Lagging indicators vs. market timing is well-explained.

• Suggestions:

  • Quantify the "6-month lead" (e.g., "S&P 500 peaked in Oct 2007; recession began April 2008").

  • Link to leading indicators (e.g., yield curve inversions, PMI surveys).

3. Simple Moving Averages (SMA)

• Strengths:

  • SMA-350 and Death Cross are practical.

• Suggestions:

  • Show a chart of SMA-50/SMA-20 crossover during a crash (e.g., March 2020).

  • Contrast with Golden Cross (bullish signal) for balance.

4. Jobs & Economic Health

• Strengths:

  • 2022 rate hikes example ties jobs to Fed policy.

• Suggestions:

  • Add Beveridge Curve (job openings vs. unemployment) to show mismatches.

  • Mention "Quiet Quitting" as a modern productivity risk.

5. Groupings of World Economies

• Strengths:

  • Clear dichotomy (Leaders vs. Challengers).

• Suggestions:

  • Challenge the GDP narrative:

    "China’s GDP may surpass the U.S., but per-capita income and innovation lag."

  • Add India’s rise (demographics, tech sector).

6. Population & Culture

• Strengths:

  • Immigration’s dual role (skilled vs. low-wage) is nuanced.

  • Confucian values/climate angles are fresh.

• Suggestions:

  • Data point:

    *"U.S. STEM workers are 20% immigrant-born (NSF data)."*

  • Address automation’s impact on low-wage jobs.

7. Globalization

• Strengths:

  • Balanced view (trade deficits vs. pollution).

• Suggestions:

  • Update for deglobalization:

    "Post-COVID, reshoring and friend-shoring disrupt China’s factory dominance."

  • Link to chip wars (TSMC, U.S. CHIPS Act).

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Structural Improvements

1. Reorganize Flow:

   • Group related sections (e.g., merge "Jobs" and "Productivity Decline").

   • Move "SMA" closer to "Markets Lead Economies" (both are timing tools).

2. Add Visuals:

   • A cycle diagram (expansion/peak/recession/recovery).

   • A table comparing Leading vs. Lagging Indicators.

3. End with a Provocative Question:

   "If AI automates 40% of jobs by 2030 (McKinsey), will productivity gains offset demographic decline?"

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Tone & Originality

• Issue: Over-reliance on Dalio/Scholars.

• Fix: Insert your unique perspective (e.g., "I’ve observed that cycles shorten during tech bubbles—here’s why.").

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Final Rating: 7.5/10

Why? Solid foundation but needs tighter logic, original insights, and data-backed claims.

Suggested Title for More Impact:
"Economic Truths Everyone Misses: Cycles, SMAs, and the Hidden Forces Shaping Markets"

[Tony: Will improve this article, but it is intended to be a quick read.  7.5 is the lowest rating of all my articles and books.]

*** Gemini 

The article "My economic theories" offers a concise overview of several key economic concepts, aiming to simplify complex ideas for the reader. It touches upon economic cycles, market indicators, global economic groupings, factors influencing decline, population dynamics, cultural influences, and globalization.

Strengths:

• Simplification of Complex Topics: The article does a good job of breaking down broad economic themes into digestible sections, making it accessible to readers who may not have a deep background in economics.

• Emphasis on Cycles: It correctly highlights the persistent nature of economic cycles and cautions against predictions of their end, referencing Ray Dalio's work as a valuable resource.

• Practical Tools: The introduction of Simple Moving Averages (SMA) as a practical tool for identifying market trends is a useful inclusion, offering a tangible application for investors.

• Diverse Factors Considered: The article broadens its scope beyond traditional economic indicators to include important factors like aging populations, cultural influences, and immigration, which significantly impact long-term economic health.

• Relevant Examples: It uses specific examples (e.g., Ben Bernanke in 2008, Ukraine conflict, China's rise as a factory) to illustrate its points, making the concepts more concrete.

• Acknowledgement of External Resources: The inclusion of links to Ray Dalio's "How the Economic Machine Works" and the Seeking Alpha article provides avenues for readers to explore these topics further.

Areas for Improvement/Further Consideration:

• Depth and Detail: As stated, it's intended to be a "short article," which means it sacrifices depth for breadth. For readers seeking a more thorough understanding, each section would require significant expansion. For example, while SMA is mentioned, a brief explanation of how it's calculated or its limitations would be beneficial.

• Causality vs. Correlation: In some instances, the article could more explicitly differentiate between correlation and causation. For example, while low unemployment can lead to interest rate hikes, the direct link to "reducing corporate profits" could be elaborated on, as the impact is more nuanced.

• "My Economic Theories" Title: While the title suggests personal insights, the content largely summarizes widely accepted economic principles and observations. While the synthesis is the author's, the title might set an expectation for novel theoretical frameworks that aren't fully met in a short overview.

• The "Death Cross" Explanation: While a "Death Cross" is a known bearish indicator, a very brief explanation of why it's considered bearish (e.g., indicating a shift from short-term strength to weakness) would enhance understanding.

• "Climate's Role" in Productivity: The statement about colder climates fostering industriousness is a historical observation but can be seen as a broad generalization. While it might have held true historically, its direct relevance to modern productivity in a globalized, technologically advanced world could be debated or qualified.

• Source Citation for Projections: The projection that "China... is projected to surpass the U.S. as the largest economy (by GDP) within the next decade" is a common forecast, but citing a source for such a significant claim would add credibility.

• Clarity on "Links": The "Links" section at the end is somewhat ambiguous. The https://www.youtube.com/watch?v=2kJxqIO5sxQ and https://www.youtube.com/watch?v=PHe0bXAIuk0 URLs are not standard YouTube links and would not directly open the videos. It would be more helpful to provide the actual YouTube video URLs or at least the video titles and channel names. The Seeking Alpha link is correctly formatted.

Overall Impression:

"My economic theories" serves as a good high-level introduction to various economic concepts and their interconnections. It's a useful starting point for someone looking to grasp the basics of how economies function and what factors influence them.

My comment on AI’s comments

This article was intended for a brief and easy-to-read article for general audience.  Many topics such as SMA have been described in other parts of this book. The two AI agents’ comments on this article are quite similar.