@nony - It’s interesting that you mention gold. I’ve actually seen gold prices plunge in value at various intervals. I don’t know of a single econometric analysis that could predict such as change; the assumption seems to be that gold rises constantly with inflation fears.
I do think mathematical models serve a useful purpose however, because certain correlations tend to remain stable over time. For example, the article talks about reduced interest rates leading to increased lending.
I think that tends to be true. What is not predictable is consumer behavior, however. For example, banks may be willing to lend, but are businesses willing to borrow? If businesses feel that the current economic climate is suffering under a weight of government regulations, they may not even borrow the available money for expansion.
That’s where the models break down. I don’t think there is a single mathematical variable for “government regulation.”