I was addressing the Austrian economics belief that economics is inherently untestable.  People don't say that about social sciences.  You are able to test things.  I would also say, about the Austrian school, that is you make claims that can't be verified, you have a hard time making basis stating economics has laws behind it, which is what is said.    I would argue that the social sciences are where you could validate what the Austrian school says.

More on the Austrian school:

http://www.theamateurfinancier.com/blog/topics/moneyisms/

Criticism of the Austrian School

The most common criticism of Austrian School economics is that it lacks intellectual rigor.  With its emphasis on logically deducted conclusions and rejection of using numbers to support their conclusions, the Austrian School economists tend to be dismissed from economics journals due to an absence of supporting calculations.

Similarly, Austrian theories come under attack for not using empirically derived data in their theories.  Frequently, these theories are also unfalsifiable, making it impossible to test them and determine whether they apply to the real world.  This untestable nature of Austrian economics, and the aggressive attempts by some Austrians to incorporate any empirical data, put them at odds with the broader economic field.

Another criticism is that, while the Austrian School is quick to criticize other economic theories (including Keynesianism and Monetarism, our earlier Money-isms), it does not provide viable alternatives.  Both Paul Krugman (a neo-Keynesian) and Milton Friedman (the founder of Monetarism) rejected the Austrian explanation of business cycles, one example of where alternate schools have rejected specific Austrian policies.

Again, not really.  They think that mathmatical models and statistics are unable to properly test the economy.(They were afterall predicting this bust to happen.)  So do most social scientists who generally hate economists for being "too focused on the numbers and not focused on people".

Who believe that the social sciences in fact can not be tested by empiracl data... not only do a lot of people say that about social sciences... it's generally the social scientsits who do so.

Note that your "Critisicism" page basically is blasting the Austrian school for not using empiracil data.  In otherwords, they are bashing Austrian schools for having a lack of quantitative data... aka numbers.

Again, this completely ignores Qualitative data... which is often used soley in publication of social science journals.

Essentially, Austrian economics doesn't get published much because it doesn't use quantitative data, because it says, you can't use quantitative data and instead need to use qualitative data.

Again, most Social Science work is built on Qualitative data... because most social scientists beilieve that social sciences are inherently untestable via numbers because it discounts the human equation.  These things can be tested, but not by numbers.

Think focus groups, one on one interviews about products etc...

these are all qualitative means that tend to prove far more important then mere quantiative 1-40 questineers about your sandwhich at arbys.

Social Scientists and Economists actually kinda have a rivalry here where they annoy each other because of this.  They also tend to not get along with Austrian School people but mostly because social scientsits tend to skew heavily liberal.  Methods wise they agree pretty well though.

Truth is, at the end of the day Monetarists and Keynesians are social scientists that like to pretend they are hard scientists.

Here is a pretty decent article explanation.

http://blogs.reuters.com/great-debate/2011/07/27/economist-heal-thyself/

Economic modeling really doesn't work, and the equations are largely meaningless... the differences is, unlike the dog... most economists are willing to keep running into that fence, because it's better off doing that then admitting that statistical models don't work like the "real" sciences.

We'd have better economic predictions if we actually backed off the stats and integrated more qualitative methods.

And in the middle of this discussion that has been going on several days, I run across this article that has Baron's warning about student loans, and postulating if there is a bubble that will happen in the student loans market: http://reason.com/archives/2011/08/05/moodys-sounds-the-alarm-on-stu

It says there won't be a bubble, because there aren't speculators coming in.  Can a market have a bubble without speculators and merely government overinflating of costs by driving up demand that shouldn't be driven up?  It connects back to the discussion on housing in this thread, but since it connects to hiring, have to wonder what the future will hold regarding the job market and economic growth, if we see a collapse in colleges.  The knee-jerk reaction to employment issues is to shove everyone into college.  Make it more affordable is the buzzword.  What I saw in the video on that page looks very much like the GW Bush speech on making housing more affordable to everyone, except it is Obama talking about college.

In regards to the economist comment, it is likely there is way too much hubris among people in economics and their individuals attempting to apply their theories to the real world, back to what I said about quantitative analysis work, producing formulas that they believe can never fail, and then overextending themselves.  In the case, it is more important to produce a believable lie, for the stake of stability, than it is to own up to what really is and can be.  I say all this watching CNBC today, and seeing the stock market drop over 600 points and the VIX indicator shoot up, and no one knowing what is coming next.  For the financial markets, better a myth lending to security than not knowing.

Except, in the case of the derivatives that failed, they wouldn't of failed, again unless something happened that has never happened.  IF these formula's were meant to fail because there was supposed to never be a 40% real estate failure, then i'd agree with you.

As for "student loans" bubbles... that has building FOREVER, not just recently, as government has been trying to push people in college forever... because college is seen as always positive.  Don't think it will really crash though...

Higher college education % is seen as higher by everyone as a matter of fact, even though for a long time there have been.

I wouldn't say we'd be hit by a bust, because most student loans are guranteed by the government.  Instead we'll just face massive deficit spending.

So the only way it'd turn to a bust is if the government says "We're done." and drastically stops funding student loans... even a "we're done" followed by gradual backoff SHOULD be fine i'd think.  Allowing colleges to shrink and/or lower prices.  Since there is a lack of actual jobs, this shouldn't effect the greater enviroment education wise.

Though yeah, a lot of people will be screwed by going to college and assuming it's going to gurantee them a job.  There are too many colleges and too many students out there right now fighting for too few jobs.(Or resources you could say.)

The thing is, government "credit" probably isn't ever going to drop... or if it does will do so gradually, hence no bust.  Those who default on the student loans have already graduated college and there are new unsuspecting lesser students fed into the system... so there is no backlash on the education system itself.

Unlike say, housing loans, where the loans are for your house.  I'd imagine that's what "You can't flip an education" means in the article.

The only real risk for a bubble burst would be if public opinion rapidly turns against college education.  Which probably won't happen due to the individual persons general feeling of "being special" and the sense of "immortality" young people have... where they all think they and there friends are going to be that group that all goes out and rules the world, or at the very least is far more successful then most people.

It really won't be a bubble burst, so much as government crushing a bunch of people through their dreams due to allowing loans to nearly anyone who wants them, an the deflation of the value of a college degree and overestimating their own chances in the job market.