A Crystal Ball That Works (most of the time)

If you have every asked me the question, “What do you think the market will do this year?” you most likely received a smile and the most professional and informative non-answer I could conjure.  It’s not that I don’t want to answer, it’s just that I don’t put much faith in my, or anyone’s else’s ability to predict such things.  There are certainly times when I think the probability of a certain outcome is high, but even that doesn’t mean my timing would be right.  To put a bow on this point, Bloomberg surveys 19 Wall Street strategists at the beginning of each year and asks them this very question.  The result for 2018: zero predicted the market would go down. The average prediction was for a gain of 8%.  Does that make these people inept?  Not at all.  It just shows that predicting the future can be more difficult than we would like to believe.