Do economists REALLY know what is going on?
The following is an editorial.If you enjoy getting frequent market updates, go to MarketWatch from Dow Jones and sign up for their free e-mail newsletter update. You will get anywhere from 2-3 updates a morning about everything from interest rate updates to housing reports. The reports can be very informative or confusing or even crazy making, depending on how you read them!
My question is this; how often are these economists really right? Their track record is never given as to how often they are right in their predictions. For example, this morning 's report was "U.S. NEW-HOME SALES SHOW UNEXPECTED AUGUST PICKUP". Unexpected is the key word here. Google information on housing reports and you will see that everyone recently has been banking on a bursting housing market bubble. Another report I got today was "U.S. durable-goods orders unexpectedly fall 0.5%". Another unexpectedly! So whose expectations were these, theirs or ours?
My point is that the economy is so big and complex that nobody can really predict with any accuracy what is going to go on. And this seems to be what news has become; not what happened and when it happened, but rather predicting what is going to happen! It appears to be the new phenomenon. Take a look at news headlines and you will see that this often is the case anymore.
As Donald Trump points out, lots of people are out there telling you how to make money in real estate, but how many of them are actually doing it? He makes a good point. Many of these people make their money selling books and tapes or giving lectures telling other people how to make money buying and selling real estate, but how many of them have really done it??? The same question should be put to the experts. Let's see their credentials BEFORE they are allowed to tell us what is or is not going to happen!
Has life become so uncertain that we need to have someone look at their crystal ball and tell us what the future will bring before we get out of bed in the morning???
Look at our past posts and you will see that we are bullish on real estate for long term investment and building wealth. These up and down changes are just market fluctuations that happen all the time. If we knew what caused them with any certainty then we would probably be consultants to the Wall Street Journal or some other publication and do better than the so-called "experts" they quote in their columns. In fact, moisten a finger and put it in the air yourself to make a prediction... you'll probably do better than these guys!
In closing, make your own reality. Be positive about our economy and invest for your future. Stick to the basics, watch the people who are making money and do what they do. Chances are you will make out just fine.
- Mick Orton
posted by SFResidence.com @ 7:14 AM
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