Didier Sornette: How we can predict the next financial crisis

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The 2007-2008 financial crisis, you might think, was an unpredictable one-time crash. But Didier Sornette and his Financial Crisis Observatory have plotted a set of early warning signs for unstable, growing systems, tracking the moment when any bubble is about to pop. (And he's seeing it happen again, right now.)
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Опубликовано:

16 июн 2013

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Комментарии : 208

@drexelmildraff7580 5 лет назад

I've been familiar with Prof Sornette's work for many years. He is one of few geniuses working in academia today. What a pleasure it was hearing him speak.

7 лет назад

It's ridiculous how many ignorant people come here not to dialogue with knowledge but to nitpick a respectable academic of his accent, which is not even that strong.

@Myrslokstok 7 лет назад

Trang Vương Usually people with an accent understand at least two languages.

@oOZdemOo 6 лет назад

His French accent is thick as fucc tbh tho

@oberscl 4 года назад

What has accent got to do here?

@dominikburger5121 2 года назад

Lol… Sornette is one of my professors at ETH Zurich. Everyone here loves his accent.

@freesk8 11 лет назад

"double, double, toil and trouble, fire burn and cauldron bubble..." That's what I imagine Ben Bernanke et al to be saying during closed door Federal Reserve meetings.

@MindDetox 11 лет назад

speak the truth even if your voice shakes! this guy delivers an EXTREMELY important message here.

@supersonic5171 2 года назад

What an amazing person he is. He is very knowledgeable in his field and on other fields as well. He is very fluent even though english isn't his native language. He is smart, confident and athletic. Seeing him makes me believe there are many great people in this world.

@bhagat04 11 лет назад

you can predict the next financial crisis by asking the US federal reserve when are they planning to have one.

@GhostInTheShell29 11 лет назад

While I agree almost anyone can spot bubbles. Knowing when they are going to pop is very important. I know someone who saw a major bubble in our economy, knowing when it popped Gold prices would shoot up he heavily invested in gold. After many years he finally sold the gold for a loss. About two years later bubble popped gold went through the roof. Knowing the pace of the bubble, knowing exactly how unstable it is. Is very important.

@brucemclee 11 лет назад

If you are having a hard time with his accent there is an option to turn on closed captioning at the bottom of the video.

@freesk8 11 лет назад

Each person interacts with nature, and risks encountering the dragons of nature at any time.

@arthurdubroue4886 2 года назад

Le diapo de la présentation est-il disponible quelque part ou au moins les sources ? merci bien

@nickjekov4554 11 лет назад

but wouldnt we pop the bubble by detecting and measuring it? if someone had did this in 2005-2006 and announced that real estate market is over valued and had proven this then the crisis would have begun 1-2 earlier that it did.

@mikegoldstone6832 6 лет назад

Very thought-provoking.....would love to see what he suggests for the emergent increase of general interest rates in the world's largest mrkets.

@benzbubblecat 11 лет назад

would love to see NNT's reply to this.

@chitrungbuitran1623 4 года назад

There was in fact a debate on Taleb'MOOCs channel

@freesk8 11 лет назад

The dragon king in Chinese myth is nature. Not just nature as in, the woods, or animals. It is the order and the power and the chaos of the natural forces for the Universe. It is the impersonal Einsteinian god of Physics. It is the power of unknown forces. It is highly unpredictable, very patient, incredibly powerful and in the long run, indomitable. You may be able to surprise the dragon king once or twice, but he adapts. It is very hard to beat him more than once.

@smallestaj 11 лет назад

Wonder if he could apply his systeme on the global warming... id love the see the forecasting on that.

@rRobertSmith 10 лет назад

at time 9:29 no index (readable) of left side of graph....what...trillions of USD? also I came here to see a circuit diagram of the hardware he uses.....where is that?

@MAGHELLA90 7 лет назад

any prediction about bitcoin bubble?

@thomasf.9869 4 года назад

Why is it on planet with millions of RU-vid users this lecture has only been watched 140K times ??

@theresbob8878 6 лет назад

Explain where the losses went. Was it cash or simply paper? Why does it trickle down? Is the bettor using money that if lost, effects others? Should that be legal then...as it wouldn't be his money?

@TheGrapplingMonkey 11 лет назад

Awesome talk! Reminds me of Hari Seldons Psychhystorie. :)

@bostjankramar11 11 лет назад

Just google FED and austrian economics and you will understand how economy works today and why there are crisis

@snowpunk116 11 лет назад

Planet Money has some great episodes on bubbles and economic forecasting.

@SIMKINETICS 11 лет назад

I'd distill this talk down to extolling the virtues of the Scientific Method as applied to economics & other studies. Mathematics is at its core; research & data acquisition is its fuel. The main benefit here is predictability that allows us, as individuals & societies, to plan for success. Economic theory has certainly missed the mark for most of us because of its ideological basis that obviously needs a make-over to bring it more into the realm of science.

@wickedleeloopy2115 6 лет назад

The factors that determine a crash are 2 things. Supply & demand. 2008 mortgage brokers giving record number of "NINJA" loans. Next...... Interest only loans... reaching over 51% of all mortgages will be the tipping point. At this rate it will be 2020! People buying houses they cannot afford.....SIMPLE. impressing other people will cost you dearly!

@dmadeb 11 лет назад

The English closed captioning is extremely bad... almost comical. TED - can't you fix that?

@BiffBifford 2 года назад

I think the great professor describes characteristics in the market that are manifesting themselves in real-time in 2021. I wonder what 2022 will look like if there is a crash and pension funds cannot make the total monthly payouts to pensioners? Derivatives are so massive that a margin call on a full-scale market collapse would bring down the entire global system. I think this is the impetus of why Russia and China have continued increasing their physical gold and silver holdings. Cryptocurrency is an interesting thought experiment but can be hacked by sovereign nations or priced fixed by central banks. Cryptocurrency currency can be manipulated to strip many of their wealth when bad intentions are the primary goal of bad actors. Excellent short talk by a fascinating professor.

@LeonidasGGG 11 лет назад

The system has grown so much and become so complex, it became organic.

@americanu197 11 лет назад

it always seemed to me like a lot of people saw the crisis coming and did nothing about it... and the daft governments of europe continued to spend a lot when it was very obvious that economic activity was going way down

@BryanKale777 11 лет назад

Thanks.. explains a LOT... Well done... peace

@Cloud_Seeker 11 лет назад

Guess what. The dot-com and real estate bubble was both financial crisis forseen by people like Gerald Celente and Peter P. Schift. We already knowed what the next financial crisis will be because we have blown up a bailout bubble to save the other bubbles and never solved the problem in the first place. We only fed alcohol to a alcoholic, and never tried make him quit his addiction.

@Jalreal 10 лет назад

Trying to analyze the 07 08 crisis by looking at stocks is incoherent. It was in extremely complicated derivatives and the perverse incentives surrounding the speculative frenzy in those illiquid markets.

@millsykooksy4863 7 лет назад

So relevant right now

@guitarzilla 11 лет назад

There was nothing surprising about the crash of 2008. When you see kids straight out of high school qualifying for mortgages on homes upwards of 250k with no real assets, something is dreadfully wrong, no guesswork involved.

@C0n7ax 11 лет назад

You can't predict the stock market because it's not based on real life resources/services anymore. 95% or more is derivative trading which as far as I understand, it is trading on something which has it's value derived from the value of something else. Clearly this introduces massive amounts of speculation and leads to huge profit gains/losses with little physical changes. Also banks can use fractional reserve banking to make multi-billion $ bets at near 0% interest. Giant Ponzy Scheme.

@Curixq 11 лет назад

Yes.

@LiamE69 11 лет назад

Before he started talking I though "Identify bubbles... bubbles always burst"

@akil2903 11 лет назад

Doesn't anyone notice the timeframe(2030-2060) for the massive change for humanity. The year he gives is 2045, which is the same year for Ray Kurzweil's singularity. There are no coincidences.

@mdueri 10 лет назад

It has been a year since this guy bragged about his predictions. He said the Nasdaq was in a bubble in May of 2013. It was around 3530 at that point. It is currently at 4300.

@zombie-survivor 9 лет назад

mdueri Now Nasdaq 4931. Didier Sornete is a God!

@MartinDxt 11 лет назад

like that what happened to apple stocks 40% growth and then crash

@johnleeb 11 лет назад

There was responsibility. The governement eliminated regulations, and the banking industry took advantage and proceeded to gouge and ruin individuals. There were indicators for those who were willing to look. Also, they are working to do it again!

@jonrita2344 3 года назад

and did it predict the current crisis?

@jorgedefoe1 11 лет назад

Thanks for replying. Iran and Syria are a few of the remaining countries outside of the grip of the banks. It's why Libya, with previously the worlds second highest standard of living, was taken out. The human race is being farmed en masse under the guise of democracy and commercialism, stirred with religion. The 1st step towards freeing ourselves is to alert people to what is really happening. Luckily, the people ARE the power and our awareness and non-compliance is all that is needed.

@mebossyounothing 7 лет назад

Ask Rockefeller family, they are planing those ahead

@muskduh 4 года назад

exactly. best comment on here

@anthonybell9630 9 лет назад

Didier Sornette is a professor from ETH Zurich, one of the best universities in Europe. All those dislikes because the cowards/sheeple can't handle the truth xD

@desidude5405 7 лет назад

Click-bait title for the video could be the cause for the dislikes. The good prof is only saying HE can predict. The video is NOT a "how to" about predicting the next crash. Of course people will be pissed for wasting their time.

@homebrandrules 6 лет назад

Anthony Bell are you a pshyic? seems like u think u are! maybe u should make a vid. claiming to predict the next crash joy of the day to you!

@ThePowerExcess 6 лет назад

The papers are out there. He explains that ideas behind the papers. The ideas are what matters. A simple way to predict movements in finance is by definition non-existent.

@christianc8265 5 лет назад

this is not true 1 minute of googling brings you right there: arxiv.org/abs/1108.0099

@dennykeaton9701 9 месяцев назад

My lawyer once said that in court. He said " you can't handle the truth."

@CM_Burns 6 лет назад

no mention of leading economic indicators like the ISM index.

@domsau2 6 лет назад

Good extrapolation is not a stright line, but a curved one, at 3:44.

@thorp.n8998 11 лет назад

Bubbles are hard to predict, very hard actually. If you believe you can see a bubble before the market, just go short a bunch of stocks whenever you see one and make millions. If bubbles were easy to see they would not exist.

@TheRhysOrourke 11 лет назад

Its being out for lik 30 min so wat do u expect

@nachoijp 11 лет назад

we can't

@wolfRAMM 11 лет назад

I hope not only me has came to quite different conclusion: he put it very simply, mb even too much

@skeletron898 11 лет назад

Let him know that he can do great things

@theskv21 11 лет назад

If you find him hard to understand, it's probably because you don't get to hear other people's accents too often, making this more of an issue about you. He's obviously French and has a French accent, but he's not CHOOSING to speak like that- as with everything, learning to master a language takes practice.

@modestmoose83 11 лет назад

I'd say there's only another 18 months until a good ol' downturn...

@gmshadowtraders 10 лет назад

13:38 - Why does the graph of the Chinese bubble stop at 2009? This talk was in 2013 and data is pretty easy to get. That makes me suspicious that this is a bit of a curve-fitting exercise. Though he does say this is 'just the third or fourth act' so maybe the financial bubble indeed goes in pockets of predictability. These so-called non-linear transitions are interesting. I still have Sornette's book on stock market crashes and power laws, it motivated me to take up finance in the first place.

@johnathanwhetstine7026 11 лет назад

I understood him.

@Futuremason 11 лет назад

He must be stinking rich with his predictions.

@johnathanwhetstine7026 11 лет назад

Interesting point.

@jimbo5915 11 лет назад

Did you?

@NDPdEport 11 лет назад

now. lets go celebrate

@MacTomas1 11 лет назад

I enjoy watching TED-Talks a lot. However, it shows also how much the way you speak counts, not only (if not more than) what you have to say. I'm not an economist so I cannot judge his ideas, but I find it hard to listen to. You can see how hard it is for him to make a point :(

@ExclusiveManual 11 лет назад

I'm having one right now. : (

@kght222 11 лет назад

what he said meant that nobody took any responsibility, not that nobody was responsible for it.

@skeletron898 11 лет назад

I just watched one of these with a boy named sam with a severe disease and i just want to make a shout out to him and if he reds

@miinyoo 11 лет назад

Schrodingers's cat will argue otherwise. By observing and 'predicting', you change the outcome thus ensuring unpredictability. Central planners have been trying this for decades and all they've done is manage to incite ever increasing amplitudes of volatility. The derivative of what they're doing is eventually going to hit a parabolic infinity. That's when the cat is both dead and alive. Predicting humans is pure fantasy, even when they're controlled. The French should know this intimately

@kimpeater1 11 лет назад

Did he say that the global population crash will occur within 2030 - 2060??

@LasPlagas245 11 лет назад

I didn't know Jason Bateman was French.

@CerberusCheerleader 11 лет назад

How will economists predict the next financial crisis? I assume, in the same way as they predicted the last one. They will cluelessly wait until it happens and than they will explain that such and such lead to this and that and how it all was inevitable and had to happen the way it happened.

@MrCharlieSurf 11 лет назад

It's a mathematical certainty that a financial crisis will occur. In fact it is occurring RIGHT NOW. QE anyone? Continual printing of fiat currencies will end in the same way 600 other paper currencies have already gone. They have an average life expectancy of 23 years. This collapse has been premeditated, foreseen, engineered, predicted for quite some time.

@thorp.n8998 11 лет назад

Their job is not to make or force people into debt. It is to give people the option to borrow money, clearly if people are of sound judgement they will only do so when they expect it to better their lives. For exampl i might go into debt to fund my education, without a bank acting as a mediator between those who wish to lend and those who wish to borrow we would be much worse off individually and as a society.

@MURDR63 11 лет назад

How to predict it: listen to Ron Paul How to prevent it: elect Ron Paul

@KaplaBen 11 лет назад

You got me with your fucking fly

@AlexLococo 11 лет назад

They do work to lend money, they don't do it because of how humanitarian they are. I know, everyone works for money, but if your job is to make people in debt, you're not nice at all.

@cloverdale87 11 лет назад

We need to do two things. Start making things the world want's and do it better then anyone else. Secondly we need to change the days we work. We are slaves of the seven day week. Meaning M-F 9-5 Traffic,lines,fuel,JOBS,and on and on would all be better off with mixing days off. People tend to like doing the same things at the same time only because of M-F=stress. Money would be spent more evenly,overcrowding finnished.

@robvh2 11 лет назад

Capitalism and democracy are fantastic systems within a moral society. And there's the problem. Don't look to socialism or communism to solve that. Pain and suffering flourish even faster under those systems and their corrupt rulers. What we need is to hold ourselves and our leaders to a higher moral standard; to shun the businesses that fail to behave honestly and responsibly; and to impeach or vote our corrupt politicians. We also need to think of our neighbour as much as ourselves.

@tonyotag 11 лет назад

2015-2016; or maybe this year (2013) This year the feelings start and it will take 3 to 4 years to work out relative to the macro (election cycles) and micro (your discrete choices) What I have heard is that the next recession will be caused by the manufacturing industry (maybe bad 6sigma practices???) Note: the ocean of economics will always have frothy bubbles, just make sure your boat is not over a natural gas bent, where lack of buoyancy will make you sink.

@dennykeaton9701 9 месяцев назад

I call BS on that

@tonyotag 9 месяцев назад

@@dennykeaton9701 your a little late on making that call. This video is 10 years old. The next recession is moat probably government caused via fiscal spending policy problems.

@dennykeaton9701 9 месяцев назад

@@tonyotag Time to go to cash?

@tonyotag 9 месяцев назад

@@dennykeaton9701 2015 -2016 was the last "recession" (but was not a recession) due to credit market cycles and lower GDP figures. This might have been caused per my first comment above anyway. As of now, building a bar-bell based portfolio is probably better at this time, it is what I have been hearing from many wealth managers on the money management media like Bloomberg, CNBC, etc.... Half in conservative cash or cash like alts with the other half in riskier assets per your age and timeline to retirement profile. This of course depends on what your wealth profile and life-goals are. At the very least, cash or cash alternatives are better at this time. (If your wealth is not too great, certificate of deposits on retail trading platforms for fixed income is not a bad way to go if you do not mind the lockup period for the cash. Otherwise high yield savings or checking in a bank. If you have more than 250K per FDIC maximum, then maybe US treasuries but depends on political risk. Overall, diversification is the best way to hedge risk.

@emsf010 11 лет назад

This guy actually advocates that "Quantitative Easing" and Austerity do not work and do not address the systemic central problem.

@YoloAlf 11 лет назад

Fuck can someone just tell me when the next financial crisis is?

@xkguy7868 10 лет назад

promises more than he delivers

@quAdxify 11 лет назад

Most of the people unfortunately have not clue what he is talking about. It's finally all statistics. That's why he doesn't make money with it, it's just a probability. No one will ever be able to predict a complex system with certainty. Most of you folks have never ever actually worked with stocks have you. It's not especially hard to get the basic trends, it's hard to know EXACTLY when to buy/ sell and probabilities are uncertainties and therefore only of little help in this case.

@thorp.n8998 11 лет назад

So i take it you never had to borrow money for a house, education or to start a business ?..

@jasonsett 11 лет назад

It's going to be the student loan bubble. I'd give it a few years until it pops though.

@skeletron898 11 лет назад

In his life

@askformoreinfowhichyouwont7510 6 лет назад

Cutting a 17 min TED talk about bubbles short: Bubble Genisis = Low Interest rates. Bubble maturity/ pop = Interest Rates rise. 17 min of tedious research compacted. Thank me later.

@fglp666 11 лет назад

The only way to predict the next financial crisis is to learn how to read the minds of those who pull the strings!!

@aethir86 11 лет назад

To predict the next financial crisis, just watch the Keiser Report on RT :) check out zerohedge

@Waitak22 11 лет назад

That was just uncalled for. You could've left the man with some dignity. Rude and unnecessary.

@Tupster 11 лет назад

But collapses are perfectly predictable. They always happen.

@Destro7000 11 лет назад

Click the 'Automatic English captions' button below this video if you're having trouble listening to his accent...ALL WILL BE CLEAR

@wolfRAMM 11 лет назад

he gave you tons of real examples, were you blind? Real info is that nothing can grow forever, and if it's growing extremely fast-there's gonna be extreme crash

@arcanekrusader 11 лет назад

We need to remove the privilege given to the banks of creating our money.

@ogre0o7 11 лет назад

This is nothing new. This is the old proverb "nothing good can last forever" applied to economics. Obviously exponential growth isn't indefinitely sustainable.

@DSBrekus 11 лет назад

thx

@WhatTheHEllFTW 11 лет назад

Heu guys, did you know the "Sornette" is a polite way of saying bullshit in french? I think it explains this video.

@AdmirableSmithy 11 лет назад

Know exactly what ya mean.

@jamesflange 4 года назад

Are global imbalances a result of a world savings glut and manipulation by Chinese authorities or a U.S. mortgage market so awash with cash that you could get a 100 percent mortgage with no income, no job and no assets?

@DonJuanDM 11 лет назад

I think he should use it to predict earthquake. If this is truly working, I rather to see it saving people lives from natural disaster than man made financial bubble created by greed.

@jimbo5915 11 лет назад

Any day

@Waitak22 11 лет назад

Don't insult a person's whole intelligence on one statement they made perhaps?

@mattalexander3764 6 лет назад

if he was betting on a bubble popping 4 years ago, he lost money

@bobwinters5572 4 года назад

Multiple bubbles have popped over the past 8 years. None have been large enough or interconnected enough to cause recession in an economy as large and diversified as the US, but specific industries and smaller countries have all gone through significant booms and busts. It could be the case that at this point, the only industry interconnected enough to cause an economy-wide recession in the US is finance. That would imply that, like '01 and '08, the next recession will also be centered in finance. But finance itself is large and diversified though quite interconnected, so it isn't necessarily obvious which part of finance will break first.