Economists and sporting commentators have two things in common: They frequently make predictions about the future and they’re right about as often as a monkey with a dartboard…
Don’t get me wrong. I’m sure that both groups have more expertise in their chosen area than I do, but when it comes to predicting the future, the problem is that it hasn’t happened yet so the only way to do it is to presume that what happened in the past will be what happens in the future unless something changes and that’s where it becomes problematic.
Take predictions about interest rates, for example. The RBA can leave them where they are, lower them or raise them. Of course an economist can’t go on some program and say, “Look, I don’t see a change until we get some more data because, at the moment, it’s really hard to predict but when we get an indication of some change, then interest rates will either go up or down, and until then, I’m predicting that one of those three things will happen…”
No, it’s far better to make some outrageous prediction even if you’re wrong because – and here’s the really interesting bit – it doesn’t seem to matter that you’re wrong because the same program will probably interview you again next month and completely ignore that you told them a completely different story and accept the idea that you would have been right if it weren’t for the simple fact that you weren’t. But only because things didn’t happen the way they would have if you’d been right. Even racehorse tipsters don’t usually tell us that the horse they tipped would have won except there were a lot of horses in the race who all ran faster.
Recently in Australia, we had the surprise of the inflation rate being slightly lower than expected and a number of economists suggested that this would mean that an interest rate cut was likely in the second half of the year. Unfortunately, the next set of figures showed a slightly higher figure than expected which led them to all suggest that the next interest rate move would be up, with one respected figure suggesting that there would be three rate rises before than end of the year.
Like I said, I’m not an expert in the area but I would have thought that with the figures bouncing around like that then we have no way of really knowing whether next month’s figures will be what we expect or what we don’t expect or, indeed, something so unexpected that we didn’t expect it even though we were saying that we had no idea what to expect.
Still, as I’ve always said, there’s no such thing as good economic news.
- Unemployment has remained steady! Oh no, that means that we aren’t doing enough to get people into work…
- Unemployment has gone up! Oh no, this means that we could be heading for a recession…
- Unemployment has gone down! Oh no, this means that an interest rate rise is more likely...
Part of the difficulty is that media companies often have a particular agenda to push so they’ll put on the guests that help them push that agenda. It’s always intrigued me that people with vested interests are often given a soft interview, as though they’re a neutral expert. You know the sort of thing. “Good morning, Mr McGillicuddy, you’re telling us that the government’s proposal to hold you responsible for all the pollution your company is causing will be counterproductive and lead to the end of a profitable industry in this country. Would you like to expand on that uninterrupted for the next three minutes while I make notes of the things you’re saying so that I can harangue the relevant minister when I get them on the program?”
Speaking of agendas, I particularly liked the headline about an opinion poll which announced that Dutton was preferred PM in Queensland. While I didn’t read the article, I did find it interesting that this was the takeaway from the poll and not that the LNP were leading the Labor Party on a two-party preferred vote federally, which leads me to presume that this wasn’t the case or else the headline would have been just that.
Part of the problem is the media’s determination to find an answer to questions that would be better not asked until somebody actually knew something definite. Whether it’s interest rates or the opinion polls, some bits of the future are too far away to do more than take an educated guess. And when I say “educated” I’m not using the word in the sense of a formal qualification; more like you’ve been educated not to open your big mouth and to make a bold statement when it’s far too early to be sure of anything.
I’ve often pointed out that when people have written off an upcoming election that not a single vote has been cast yet. While some governments are extremely popular and others are on the nose, this can change quickly with an unexpected event. Howard, for example, may have lost in 2001 if not for the Tampa and 9/11.
So when people are saying that the best that Labor could hope for is a minority government, I have to wonder whether they’ve actually thought about it deeply or whether that just seems likely because the opinion polls showed them slipping, before the opinion polls showed them getting back to where they were before they slipped and then one poll showed that they were slipping, so Dutton may be PM before we know it and… whoops, this poll shows that he’s going to lose his seat to an Independent.
Yes, I guess no program is going to invite me on to explain that, not only do most people not know what’s going to happen, but I have even less idea than them!
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Australia was quietly reduced to becoming a sty ground stinking mess after Jack Howard the bumbling buffoon had set up failure for us, in order to satisfy the donors, patrons, money lords. Then, we were to get a stinking run from Anality Abbott to mad Meataxe, Moronic Morrison, the dud actor and self satisfier. Now, Peter Duckwit-Futton is posing as a human, a leader, a wit and scholar.., laughable. This nation faces a seriously threatened future, AUKUS rubbish, environmental damage, social dissonance, a poorly undereducated citizenry, a reluctance to understand the unpalatable, a lashing out in childish tantrums, debt, poverty, unsettling homelessness and inability to foresee a better future.., it’s all there and only our better efforts can help us.
I can’t understand why some smart pundit with some knowledge of Roman history doesn’t start examining the entrails of dead pigeons in order to divine some propitious omens.If none are found,they could always fall back on the Sky in the Dark mob, who are even more full of shit than the pigeon,and Boofhead combined.Failing all else, the monkey with a dartboard could be a possibility…that is if the RBA is willing to let him go.
According to Newscorp, SKY and the polls (all of which are entirely reliable) the electorate is clamouring for a coalition government at the next election – lusting for a Dutton/Ley leadership team and pining for a return of Barnaby Joyce as leader of the Nationals and as a prospective Deputy PM, Treasurer and minister for womens’ affairs in the new government.
What’s not to like ! ..
NYU journalism expert Jay Rosen describes it as ‘horse race calling’ helped along by proliferation of polls vs. hollowing out and less reporting, with dollops of dog whistling.
Worse than being uninformed or misinformed, it leads the public to be focused on the moment or now (classic PR/sales technique) to preclude context, reflection and deeper understanding of the past, present and future, leaving a space for policies to be inserted into public narratives and legislative agenda, often without anyone realising…. https://nymag.com/intelligencer/2016/07/jay-rosen-problem-with-the-media.html
The Reserve Bank of Australia will hold its meeting over two days (Monday & Tuesday) and then announce it’s decision on interest rates. It’s a bit like the Madhatter’s Tea Party apparently with silly walks and funny hats, whoopi cushions and practical jokes.
Do you remember when the former RBA Governor, Philip Lowe, came out of one of these meetings back in March 2021 and told us that the official cash rate will remain at historic lows until “at least 2024”.
Then we had thirteen successive rate increases in the following months !
It may well be that the new Governor will take her economic theory from Lewis Carroll :
“Now, here, you see, it takes all the running you can do, to keep in the same place. If you want to get somewhere else, you must run at least twice as fast as that!”
― Lewis Carroll, Alice Through The Looking Glass
Yes Rossleigh,
But y’know, enlightenment and its rewards will never come until ya get with the program.
It’s no small irony that the most sophisticated forms of forecasting are known as Monte Carlo simulation, and Delphi.
Of course, speaking of futures, it may well be that upcoming AI methods may well resort to the monkey at a dart board method or even advanced predictive scatology – methods currently favored by the mainstream media, where the former relies on a hire-in of those aspiring to ape the boss, and the latter where force-feeding a diet of dross always guarantees a continuous output of Montezuma’s revenge to spread far and wide.
Back to sophistication ….
Monte Carlo simulation ….. named after the great Place du Casino, famous for extravagant display and reckless dispersal of wealth, come in spinner.
Delphi ….. named after the Oracle of Delphi, where she would breathe in the effluvia, reprocess it as jibber-jabber, whereupon it would be reinterpreted by the assemblage of expectant cretan (or is that cretin) priests already loaded with the common gossip. They would then recombobulate it all until they reached a consensus, pithy spin.
It’s no use decrying “It’s all Greek to me.” nor relying on algorithms, it goes way back before that to India where they had three heads, six arms, noses of elephants and boundless wisdom.
Get with the program … oh, wait a minute, is that ‘m’ or ‘mme’, mmmmm!
Harry Lime.
They won’t do augeries with dead pigeons because the woke animal activists will be after them and soc meeja and maybe channel seven will do an outrage segment on how cruel they are with our little feathered friends.
paul
I’ll qualify that…they’ll be feral pigeons,not natives,thereby killing two birds with one stone…so to speak.I know some people would still be upset,after all some people think cats are lovely,when we know they’re murdering bastards.Maybe we could examine the entrails of cats…it’s a win/win.
The thought of Potty Boy Dutton being PM is terrifying! Tone the Botty was horrendous and incompetent and Potty Boy is worse! One thing is for certain with economists; you can have 12 of them around a table and get 12 different opinions.
For ACOSS CEO
Dear Cassandra Goldie,
I urge you to publicly acknowledge 2 illegal debt schemes administered by Services Australia.
Scheme #1. Fake Review scheme. Instead of a formal review decision, Services Australia sent me an objection decision by an anonymous “delegate or authorised officer”. This is illegal. I provided your office with plenty of documents from different public officials supporting this scheme.
Scheme #2. Family Assistance Office automatically issue debts for the whole Rent Assistance, if a parent was ineligible for FTB. This is illegal. Instead of a debt for around 15% of Rent assistance (dependent on FTB), FAO request to return the rest 85% of Rent Assistance as well.
ACOSS refused to answer simple questions regarding legality of the schemes or debt notices I received.
Cassandra Goldie, please, comment this information.
HarryLime.
Accurate and comprehensive reply. May your chickens NOT turn into emus and kick you dunny door down.
Yes, Clakka. They kept the Pythia in a dark hole, didnt feed her well and loaded her with dope, according to one source.