Thursday, April 21st, 2011 11:19:06
Economics is much simpler than many highly paid pundits would like you to believe. At the same time, it’s also much more complex than it might appear initially. For instance, why are there so many economic pundits when all they do is make predictions that often prove wrong (see nearly any of the reporting that preceded the Great Recession)? Are they really adding value?
Not all forecasts are a waste of time. Forecasting and tracking of weather have improved dramatically since the 1970s.
Radar, storm tracking, pressure readings, shared resources and, more recently, observers on the ground who provide their own video of weather as it occurs have all gotten more sophisticated — and more reliable — in recent years.
But economic forecasting seems far behind this technological wave. While there might be more data, more computing power and more tracking, there is little consensus on what data to follow or what actions might help create a more pleasing economic climate.