Best of the Week
Most Popular
1. Gold vs Cash in a Financial Crisis - Richard_Mills
2.Current Stock Market Rally Similarities To 1999 - Chris_Vermeulen
3.America See You On The Dark Side Of The Moon - Part2 - James_Quinn
4.Stock Market Trend Forecast Outlook for 2020 - Nadeem_Walayat
5.Who Said Stock Market Traders and Investor are Emotional Right Now? - Chris_Vermeulen
6.Gold Upswing and Lessons from Gold Tops - P_Radomski_CFA
7.Economic Tribulation is Coming, and Here is Why - Michael_Pento
8.What to Expect in Our Next Recession/Depression? - Raymond_Matison
9.The Fed Celebrates While Americans Drown in Financial Despair - John_Mauldin
10.Hi-yo Silver Away! - Richard_Mills
Last 7 days
Palladium Surges above $2,400. Is It Sustainable? - 27th Jan 20
THIS ONE THING Will Tell Us When the Bubble Economy Is Bursting… - 27th Jan 20
Stock Market, Gold Black Swan Event Begins - 27th Jan 20
This Will Signal A Massive Gold Stocks Rally - 27th Jan 20
US Presidential Cycle Stock Market Trend Forecast 2020 - 27th Jan 20
Stock Market Correction Review - 26th Jan 20
The Wuhan Wipeout – Could It Happen? - 26th Jan 20
JOHNSON & JOHNSON (JNJ) Big Pharama AI Mega-trend Investing 2020 - 25th Jan 20
Experts See Opportunity in Ratios of Gold to Silver and Platinum - 25th Jan 20
Gold/Silver Ratio, SPX, Yield Curve and a Story to Tell - 25th Jan 20
Germany Starts War on Gold  - 25th Jan 20
Gold Mining Stocks Valuations - 25th Jan 20
Three Upside and One Downside Risk for Gold - 25th Jan 20
A Lesson About Gold – How Bullish Can It Be? - 24th Jan 20
Stock Market January 2018 Repeats in 2020 – Yikes! - 24th Jan 20
Gold Report from the Two Besieged Cities - 24th Jan 20
Stock Market Elliott Waves Trend Forecast 2020 - Video - 24th Jan 20
AMD Multi-cores vs INTEL Turbo Cores - Best Gaming CPUs 2020 - 3900x, 3950x, 9900K, or 9900KS - 24th Jan 20
Choosing the Best Garage Floor Containment Mats - 23rd Jan 20
Understanding the Benefits of Cannabis Tea - 23rd Jan 20
The Next Catalyst for Gold - 23rd Jan 20
5 Cyber-security considerations for 2020 - 23rd Jan 20
Car insurance: what the latest modifications could mean for your premiums - 23rd Jan 20
Junior Gold Mining Stocks Setting Up For Another Rally - 22nd Jan 20
Debt the Only 'Bubble' That Counts, Buy Gold and Silver! - 22nd Jan 20
AMAZON (AMZN) - Primary AI Tech Stock Investing 2020 and Beyond - Video - 21st Jan 20
What Do Fresh U.S. Economic Reports Imply for Gold? - 21st Jan 20
Corporate Earnings Setup Rally To Stock Market Peak - 21st Jan 20
Gold Price Trend Forecast 2020 - Part1 - 21st Jan 20
How to Write a Good Finance College Essay  - 21st Jan 20
Risks to Global Economy is Balanced: Stock Market upside limited short term - 20th Jan 20
How Digital Technology is Changing the Sports Betting Industry - 20th Jan 20
Is CEOs Reputation Management Essential? All You Must Know - 20th Jan 20
APPLE (AAPL) AI Tech Stocks Investing 2020 - 20th Jan 20
FOMO or FOPA or Au? - 20th Jan 20
Stock Market SP500 Kitchin Cycle Review - 20th Jan 20
Why Intel i7-4790k Devils Canyon CPU is STILL GOOD in 2020! - 20th Jan 20

Market Oracle FREE Newsletter

Nadeem Walayat Financial Markets Analysiis and Trend Forecasts

Motley Fool Says Ignore Stock Market Forecasts and Predictions for 2010, But...

Stock-Markets / Financial Markets 2010 Dec 24, 2009 - 12:57 PM GMT

By: Nadeem_Walayat

Stock-Markets

Best Financial Markets Analysis ArticleA recent email titled "3 Reasons You Should Ignore Predictions for 2010" from the popular UK personal finance website Motley Fool perked my interest. My immediate thought was wow are they going to state that the real secret of successful trading is to react to price movements in real time, and if so what are the other 2 reasons?


Leaving aside for the moment the contradiction in the preceding day's email also an from Motley Fool titled "6 predictions for 2010", and several more subsequent emails along the same lines.

Firstly, I don't like the word PREDICTION as no one can PREDICT the future, all one can attempt to do by means of in depth analysis is to arrive at a scenario that projects / forecasts trends based on probabilities.

Motley Fools Reasons of why you should ignore predictions for 2010 and What you should do instead. Motley Fool

1. No one -- no analyst, no economist, no politician, no academic, and no investor -- predicted with precision the 22% drop in the FTSE 100 from 1 January 2009 to 9 March 2009.

FTSE 100 Index Stock Market Forecast 2009 - 22nd January 2009

FTSE 100 Forecast 2009

FTSE 100 Index Mid 2009 Low 3400 - 70% Confidence; End 2009 at 4,600 (During December 2009) - 70% Confidence

2. The second reason you shouldn't give much heed to predictions for 2010 is that the forecasters will alter their predictions as the year unfolds.

They are correct, forecasts have to be revised, but not for the reasons alluded to for the fulfillment of a target i.e. in this case for the FTSE low of 3,400 being fulfilled in March 2009 DID call for an update.

17 Mar 2009 - FTSE 100 Index Stealth Bull Market as Bear Market Bottoms at 3,460

This article is a quick update which includes summaries of recent analysis and the initial FTSE buy triggers for what I expect will turn out to become a multi-year bull market whilst the vast majority of market participants (small investors / analysts) FAIL to recognise the stealth bull market now underway until many months and a good 30% rally has already taken place as the perma bears that have enjoyed much press coverage as the bear market raged WILL continue to convince most investors from failing to participate, leaving only the smart money, i.e. hedge funds, fund money pools and yours truly to accumulate.

3. The final reason you shouldn't give much heed to predictions for 2010 is that the forecasters have no accountability for their predictions.

Yes, no one wants to be reminded of wrong market calls, for at the end of the day the future is unwritten and events that some call black swans can change subsequent market trends (though black swans are more often used to explain away poor analysis) which DOES mean one needs to continuously analyse the markets one trades or invests in. It is never a case of fire and forget, but more along the lines of creating a scenario and then performing periodic in depth updates as targets are achieved and triggers are hit.

However clearly, not all analysis and hence forecasts are of the same caliber, therefore IT IS important that past market calls ARE evaluated on subsequent price action as we at the market oracle are undertaking through exercise of allowing all site visitors to VOTE on the Accurate Forecast Articles Published between Sept 2008 to Sept 2009. As those that did get it right during 2009 have a greater probability of getting it right for 2010. I say probability for at the end of the day that is all a forecast can be, i.e. NOT a PREDICION OF AN EVENT, But a % probability of an scenario transpiring.

Now after the Motley Fools discrediting of ALL future Predictions / Forecasts for 2010 (presumably including their own), what do they advise readers should do ?

Pay £29.50 for their 10 share picks of 2010 (predicting these stocks will rise in price).

As for where I think the stock market is headed during 2010?

The analysis has been underway that will culminate in final conclusions / forecast trends in the following sequence - Inflation, economy, interest rates, housing, stocks, other markets. To receive the analysis in your email box on completion, ensure you are subscribed to my always FREE newsletter.

By Nadeem Walayat
http://www.marketoracle.co.uk

Copyright © 2005-09 Marketoracle.co.uk (Market Oracle Ltd). All rights reserved.

Nadeem Walayat has over 20 years experience of trading derivatives, portfolio management and analysing the financial markets, including one of few who both anticipated and Beat the 1987 Crash. Nadeem's forward looking analysis specialises on the housing market and interest rates. Nadeem is the Editor of The Market Oracle, a FREE Daily Financial Markets Analysis & Forecasting online publication. We present in-depth analysis from over 400 experienced analysts on a range of views of the probable direction of the financial markets. Thus enabling our readers to arrive at an informed opinion on future market direction. http://www.marketoracle.co.uk

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any trading losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors before engaging in any trading activities.

Nadeem Walayat Archive

© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules