To put it in terms of mental time travel, in the pure rational expectations world memory of past experience, with all its attendant imperfections, does not play a role in the formation of expectations whereas in an extrapolative world it does pretty much all the work. Some research and casual observation suggest that a mechanical assumption of extrapolative expectations does not fit reality.15 True, there are many instances of ‘momentum’ in markets that rational expectations cannot explain.16 But there is also plenty of evidence that markets and investors do also factor news into prices. The much criticised theory of rational expectations was a reaction to ‘[t]he implicit presumption in these … models … that people could be fooled over and over again,’ as Robert Lucas said in 1995 in light of winning the Nobel Prize for this work.17 Lucas was commenting in the context of inflation surprises – but the same holds true for other areas like debt default.18  13  See, for example, Shiller (2007) I am using extrapolative expectations here in a broad way to mean expectations that are based on the past experience continuing. There is a broader question of whether expectations reflect learning and adapt – that is, learn from the past without assuming that the future will follow the past. 15 Kahneman and Tversky (1973) famously shows how humans are neither rational nor mechanical in making predictions, rather applying (oft-mistaken) judgment.
We strive to keep up with new forms of communication, making us active on social networks by posting the the latest data in real time, addressing key changes and visualizing trends, making information available to more target groups. One of the aspects of enhancing our communication in this segment are certainly these regular meetings with you, as a platform where certain more complex statistical concepts can be openly discussed thus giving them analytical feature. During this year, there has been a trend where most of the media publish our latest statistical immediately after our release, which contributes to keeping the public informed on time. At the same time, the number of your articles related to central bank statistics more than doubled this year compared to last year, and even more compared to 2017, further increasing the their availability to all users. Since we have been publishing regular statistical releases, the number of visits to our website has increased, indicating that users are actively using these releases as a source of information. I have to mention that we are constantly and actively presenting the statistical data to the public in an indirect way, as well. They are the basis of our analytical infrastructure and decision-making. Therefore, in our monthly press releases, in which we inform on the monetary decisions, we refer to several statistical dimensions that we produce – for example monetary statistics, external statistics and banking system data. In our regular publications, analytically and in a consistent context, we talk about about economics through statistical data.