Nasim Taleb, author of the book "the Black Swan: under the sign of unpredictability", in 2007 warned of the difficulty of predicting unusual events. A large number of analysts and forecasters does not guarantee an accurate forecast, as it is often their opinion is just the result of collective thinking.
The recent global financial crisis demonstrated that market and economic forecasters are not able to foresee many of the consequences, so their predictions investors use very carefully.
The problem is that the experts are much more closer to each other than to the real result, since nobody really wants to stand out.
The financial crisis was unexpected for most, however, he struck too optimistic and too pessimistic, which were not able to "catch recovery", and waited for the new system drops.
5 accurate predictions
Bubbles Robert Shiller
The Yale University economist Robert Shiller in his book "Irrational exuberance", released in 2000, correctly assumed that the technological sector of the USA is ready to fall.
Five years later he published the second edition of the book where he predicted that prices in the housing market are violated and the market may collapse.
In 2007, Shiller predicted the collapse of the US real estate market and subsequent financial panic.
The decline in Citi's version of Meredith Whitney
But by the time of the banking collapse, "bloom", she became the star of wall street, and eventually she opened her own company and became popular all over the world.
In the fall of 2007 she said Citigroup would have to cut their dividends, as the company will face billions of dollars in losses from toxic assets amid falling mortgage market and a severe economic downturn.
After that, she repeatedly published "bearish" forecasts for banks and the economy and became the object of media attention and investors, who watched her words.
Prediction of crisis from Nouriel Roubini
"At the moment I'm worried that the bursting of the bubble – and we have not yet seen – will lead to broader systemic banking problems. They will start with mortgage lenders, they are already in trouble because of rising defaults and then the problem will move to other banks and financial institutions across the country".
"Black" predictions Elaine Garzarelli
In 1987, the stock market has shown very strong results, but one of the analysts of wall street insisted on extremely "bearish" forecast.
At the time, Garzarelli worked at Lehman Brothers and she said that market figures are inflated by 35%.
Her predictions was preceded by "black Monday". The day after her negative review of the market dropped 120 points. As a result, her persona was in the crosshairs of the media and colleagues, so she felt a lot of pressure.
Work at Lehman, she lost in the early 1990s, but still managed assets very well.
Forecast "the greatest" by John Paulson
Although Paulson was not alone in his skepticism about the mortgage market, its profit of $15 billion on this background makes him a "leader". Other investors knew about his position, but laughed at him.
In the end, Paulson is slightly delayed with preservation of its position, but still remains one of the most respected managers of hedge funds at the moment.
The 3 most inaccurate forecast
The failure of Meredith Whitney municipal bonds
So all the fanfare associated with its forecast, were not fully justified, and the result was not long in coming. At the end of December 2010 during the program "60 minutes" on CBS, she said that 50 to 100 issues of municipal bonds will default, hi to losses in the hundreds of billions of dollars.
Although no high-profile defaults there were, the situation was far from her prediction.
In his book, released in 2013, Whitney has only briefly mentioned his prediction, claiming that the media is too much "inflated".
Besides, she doesn't like that her name became "synonymous with doom and gloom". Currently her name is mainly associated with the Outlook on the bonds, and the reputation is considerably tarnished.
The denial of the crisis Abby Cohen
In fatal 2008 she was put on growth, although the market was ready to explode. She set a goal to 1675 points on index S&P500, not foreseeing that the world is falling apart. Then the index closed at the level 903,25 of the item that is dropped by 37%, and is 46% below the goal Cohen.
But on wall street there is always a place for second chances, and Cohen continues to work.
Crisis Ben Bernanke
However, he underestimated the negative impact of the mortgage crisis.
In a speech delivered March 28, 2007, he said: "Although the crisis in the mortgage market has created severe financial problems for many individuals and families, the consequences of these events in General is less clear. However, at this stage the impact on the economy and financial markets clear. In particular, mortgage loans, offering borrowers with a fixed interest rate for all classes of borrowers show good results, with low levels of delay".
It soon became clear that the statement turned out to be tragically short-sighted.
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