"The joke’s an old one, but it’s been given new life after the chief economist of the Bank of England—among the most important jobs in the profession—compared economics to one of the biggest forecasting failures of weather people."
is optimistic that, like meteorology after its fiasco, applying more
data and advanced computing can help economic forecasting recover from
its failure to predict the 2007-9 financial crisis."
shouldn’t be. The problem isn’t that forecasting the weather and
forecasting economics are different (though they are, in important ways
I’ll come back to). The problem is that they’re very similar, both
trying to predict complex systems that can be tipped from one state to
another by very small changes," writes James Mackintosh in The Wall Street Journal (1/9/17). He continues: "History suggests investors should put little trust in" economic forecasts and the upcoming year promises to be one of the most unpredictable ever with the new administration. So take any economic forecasts with a grain of salt and focus investment decisions on long run, fundamental principles espoused in this blog.