Predictions are hard - Printable Version

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Predictions are hard - BostonCard - 05-31-2020

especially about the future (so says Yogi Berra).

Regardless, FiveThirtyEight got a bunch of economists to predict where the economy will be:

https://fivethirtyeight.com/features/dont-expect-a-quick-recovery-our-survey-of-economists-says-it-will-likely-take-years/

Short version, the median economist thinks that unemployment at the end of the year will be somewhere between 10 and 15%.



A plurality think that unemployment won't fall below 10% until later than Q2 2021:

Quote:To give you an idea of how terrible a double-digit unemployment rate potentially sustained over 21 months would be, the unemployment rate had been at or above 10 percent for only 11 months total from 1948 through 2019.

And a plurality think that GDP won't get back to its pre-COVID-19 levels until the second half of 2022 or later.



We're looking at a whole lot of economic suckage for a long time.

BC

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RE: Predictions are hard - Mick - 05-31-2020

Ya think?

How so many smart people never saw this coming, I'll never know.

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RE: Predictions are hard - burger - 05-31-2020

In my field, the scientists are generally smart enough to avoid making predictions.  

I wish economists would call these things what they are: guesses.

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RE: Predictions are hard - Nan3cy - 06-01-2020

My favorite instruction for those who would make forecasts: “If forced to forecast, give them a number but don’t ever give them a date.”

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RE: Predictions are hard - Snorlax94 - 06-02-2020

(05-31-2020, 09:57 PM)burger Wrote:  In my field, the scientists are generally smart enough to avoid making predictions.  

I wish economists would call these things what they are: guesses.

I don't think the economists *want* to make predictions, but if they're asked, they'll take a stab.

It's like if I ask my primary care doctor what my life expectancy based on my medical history and insist she take a stab, and demand that she predict it accurately within a year, and if she ventures a guess and she's wrong, blame her, and say she's not a scientist.

I imagine there is an incredibly wide range of guesses for the economy because of the medical and political unknowns -- can people develop antibodies and be immune? If so, for how long? Can an effective vaccine be developed? If so, when, and how long will it take to mass produce, and how will the distribution go? Will there be war? ETC

If you provided economists, "assume a war does not break out, social unrest quickly ends, we find multiple effective vaccines by the end of the year and roll them out so that 80% of Americans can get effectively vaccinated by next April (and the rest of the developed world within 6 months of that)..." then I imagine there wouldn't be such a wide variance.

Sometimes the largest economic uncertainties are economic (balance sheets, consumer debt, consumer confidence), but right now, they are mostly medical, political and social.

I've generally been one of the more optimistic people on this board (both for the football team and for the economy), but a lot of it is probably due to the fact that in my "medium-case scenario", we find effective treatments this year (decreasing the shot-term economic impact), we stop screwing up domestically, and we will be able to have a substantial portion of the US population vaccinated by next summer. There are good case scenarios, medium-case scenarios, and even darker darkest timeline scenarios.

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