Yogi Berra once said, “It’s tough to make predictions, especially about the future.” He was a wise man. No wonder they named a cartoon character after him.
The problem is that everything we do in finance ultimately relies on some kind of belief of how the future will play out. As a result, we often search for prophets who can help us make a profit. Of course these prophets, otherwise known as economists, don’t seem to agree with each other. Some even seem to have secondary agendas.
You know what I mean—the guys who boast about predicting the great recession of 2008 but omit the fact that they also predicted recessions every other year for the last two decades!
The economy is cyclical. That means if you keep saying the same thing all the time, periodically you will be right! But only drawing attention to those occasional events is a bit disingenuous don’t you think?
It’s also suspicious when they talk about gold to protect against cataclysmic events and just happen to have a thriving business that sells gold. That’s hardly an unbiased source.
Listen, like everyone else, I’m looking for some help with the future. Wouldn’t it be great to be given a heads up on events like 2008 several months before they happen? Wouldn’t it be great if there was someone who could tell you for sure that the next 10 years will be the most profitable in history and that you should invest everything you can?
Of course that would be great but without Michael J. Fox’s Delorean in “Back to the Future”, it ain’t gonna happen. Economists can’t even agree with one another so why bother listening to any of them?
Well, I would argue that you just need to do a little homework and decide who is worth listening to. I’ll tell you what I do. I vet my sources of information the same way I vet my real estate partners.
Now, it may not be important for me to know, like and trust an economist, but it is critically important for me to understand their track record. How frequently do economists tell you their batting averages?—not often in my experience. Why do you think that is?
Wouldn’t that be useful information? After all, If you could find a source that has been over 95 percent accurate with both positive and negative predictions in the US economy over the past 70 years, would you take their predictions seriously? I would.
That’s exactly what ITR Economics has done and its the reason why they are my single most trusted source of economic forecasting. When they talk, I listen. This week’s Wealth Formula Podcast will give you the opportunity to do the same as I interview ITR economist, Catherine Putney.
Catherine Putney specializes in applied research for business cycle trend analysis, growth-cycle trend analysis, and implementing cyclical analysis at the practical, company level. She holds a master’s degree in economics from the University of New Hampshire.
Catherine regularly contributes articles to ITR Economics’ flagship publication, the ITR Trends Report™, focusing on the manufacturing sector of the US economy. Catherine and the ITR team have put this expertise to work for companies across a wide range of industries, including manufacturing, chemicals, fibers, healthcare, distribution, real estate, construction, and technology.
- Catherine talks about the 95% accuracy rate of ITR Economics
- Roaring 2020s and Depression in the 2030s
- What is the effect of the latest coronavirus outbreak on the global economy?
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