Most economists failed to predict the market crash of 2008--so many that it is hard to count them all. But how is this even possible? It's on a scale of this hypothetical: 98% of meteorologists failing to predict a huge hurricane hitting the coast of Florida. Consider this description of the problem:
Like everyone else, we wondered how could the world's leading economy and its top economists, including the Federal Reserve Chairman, Ben Bernanke - a man who is surrounded by a network of smartest investors, scientists, and think tanks - miss the financial crisis and its impact on the US Economy?
The predictive failures by economists causes a friend of mine to argue that, as a general rule, economists are not scientists at all, and that they are "frauds." In my opinion, he's overstating the point because
there were some economists who clearly predicted the burst of the housing bubble, but most of the economists who take to the airwaves don't seem to be scientists like the scientists who develop vaccines or design solar panels. They are often
terrible at making predictions, and their lapses can look cataclysmic in retrospect. They are like sportscasters, always looking forward to the next game, trying hard to divert attention from their previous failures. They seem more like lawyers or PR specialists than scientists.
This article at Wharton suggests that the economists who failed to predict the housing bubble lack "common sense":
