Which economic forecaster or economist can you really trust most of the time, if not all of the time?

• Which economic forecaster or economist can you really trust most of the time, if not all of the time? Please tell me whom you really trust. I found an article about the real use of economists. Even though it was written in a Canadian newspaper back in 1991 , I think it still applies worldwide and in our times. Tell me if I am wrong. "THREE THINGS CEOs WANT TO KNOW ABOUT: -the timing of economic upturns -the timing of economic downturns -wild cards no one's thought of THREE THINGS ECONOMISTS AREN'T SO GOOD AT: -foreseeing economic upturns -calling economic downturns -warning about wild cards no one's thought of THINGS ECONOMISTS ARE REALLY GOOD AT: -predicting the past -not straying from the middle of the herd -alluding to 'The Fed' -sounding cautionary notes -explaining why the forecast was wrong .....what do economic forecasters do really well? If you don't expect precision, most economists are pretty good at seeing where sets of assumptions lead. Indeed, economists try to get their clients to pay less attention to the monthly or yearly horoscopes than to a range of various hypotheses. "Forecasting," says George Vasic, director of Canadian economic services at DRI"McGraw-Hill, "is really an exercise in contingency planning. What most people are looking for is a range of scenarios that will provide insulation from a particular set of developments. Of course it's difficult. If it weren't, no one would be asking. The day we move to annual 3% growth and stable interest rates is the day a lot of economists will be unemployed." Clients tend to agree. "I don't expect our forecaster to predict what wage rates will be in two years' time. That's useless," says Fred Belaire, corporate economic adviser to Atomic Energy of Canada Ltd. "I do expect a reasonable base case that will be in the ballpark if current assumptions hold. That's what we want to know: How is this forecast at risk?" For firms negotiating contracts internationally, independent forecasters may provide a neutral, third-party assessment of project costs, bolstered by a global reach. Notes Kevin Alexander, director of pricing and program analysis at Boeing of Canada Ltd.: "Most companies can't afford the in-house expertise needed to evaluate all the countries they might wish to do business with." Others need a longer perspective and some are convinced that forecasters can at least help them with such a model. "A mine takes three years to develop and might be in production for 50 years," says Ted Yates, Cominco Ltd.'s manager of market research. "If your forecaster can find the turning points in the five-year trend, he'll always outwit the guy who's only looking ahead three months." ....DOES THIS SOUND FAMILIAR? "How long will this recession last? Those who respond with facile assurance divide into two groups: those who do not know and those who do not know they do not know. The Great Depression of the Thirties lasted a full 10 years. The reputations of the most respected and luminous economic and financial figures of the time suffered badly from their repeated predictions that it would very soon be over." -John Kenneth Galbraith" Source: Gurus in Wonderland Most economic forecasters are more confused about what the future holds than we are. So why are we still listening to them? MICHAEL POSNER 2911 words 19 April 1991 The Globe and Mail Please tell me whom you really trust. Thanks a million.

• Answer:

  If someone could predict economic upturns, downturns, and wild cards, do you really think they'd tell you? Wouldn't they be keeping that information a secret, and using it to pile up a huge amount of money? I've forgotten the name of it, but there's some mutual fund out there whose stock never splits. It's something like $4000 per share. It consistently beats the market -- but part of the reason why is that they never tell anyone what they expect to happen. They just go out and invest -- and do great. If any economist or forecaster is giving away his predictions, then that's an indication of how much he thinks they're worth. Which is to say, "nothing".