Proof That Economists Make Wild Guesses, Not Forecasts

A study by the Reserve Bank of Australia found out that their economic predictions could’ve just as easily been done by a monkey throwing darts at a chart:

  • Only 70% of inflation forecasts were accurate
  • Unemployment estimates were as good as a roll of the dice
  • Economic growth predictions were somewhere in between

They looked at 20 years’ worth of forecasts for the year ahead to get that data. Bottom line: forecasting the economy is like trying to forecast the dice in craps, but instead of losing money to the casino, you get paid a high salary and get mentioned in the news every year. Why? Because we need to plan for something in the future… even if those plans are based on fiction.

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From Australian Broadcasting Corporation, via Slashdot


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