Broker Check

The Futility of Making Predictions

April 20, 2024

Folks sometimes think I'm dumb or unknowing for responding to a request for a prediction on a stock, the market's direction
or what interest rates will do: with an "I dunno!" If I knew with any certainty would I be offering my services still or
would I be sitting on some tropical island, tropical drink in hand and laptop at the ready to execute some new,
brilliant insight that my firing synapses brought forth? Oh that it were true!

Certainly this applies to all the various and undry Gurus we see in the media or investment shows on cable. If they really knew, why wouldn't they just push
all their investment chips into the center of the table and go "all in?"

An excellent example of the futility of making predictions can be provided by this recent news item from the Wall
Street Journal"

"...Less than four months ago, Wall Street was convinced that the Federal Reserve would cut interest rates a half-dozen times in 2024. As recently

as last month, the Fed itself signaled that it would likely cut rates three times this year. This week, however, Fed Chairman Jerome Powell hinted

that cutting rates might not be feasible anytime soon, given the robustness of the economy and the stubbornness of inflation.

Repeat after me: No one—not even the Fed!—can reliably forecast interest rates or the Fed’s actions."

Amen!