Predictions

by James Corbett, The International Forecaster:

A prediction (Latin præ-, “before,” and dicere, “to say”), or forecast, is a statement about an uncertain event. It is often, but not always, based upon experience or knowledge. There is no universal agreement about the exact difference between the two terms; different authors and disciplines ascribe different connotations.

Although guaranteed accurate information about the future is in many cases impossible, prediction can be useful to assist in making plans about possible developments; Howard H. Stevenson writes that prediction in business “… is at least two things: Important and hard.”

If you really want to make a fool of yourself, attempt making predictions about things and then post it publicly. It has quite the humbling affect, let me tell you.

Sometimes you can line up the dots, and a clear picture emerges. Other times, even with the best intentions, your concept of what “should” happen in the future, simply dissolves. It’s probably not a wise business to be in.

Here’s an example of how despite your best intentions and research, things don’t always pan out. In 2000 we had just come through the Y2K scare and into a new “century” mark. In my “what’s in store for the future” letter in early 2000 I made these two predictions… 1) Gold would hit 1000 dollars an ounce within 10 years. Well that came true, exactly as planned. But my second prediction was….2) they’d cure most cancers within 10 years. As you know, that one certainly has not come true.

So, why did one prediction work and the other didn’t? Weren’t they coming out with new genetic research almost daily? Wasn’t there a slew of new high tech biotech companies coming out with new drugs? Weren’t millions of dollars being spent on research? Yep, all that and more. But here we are 17 years after I made that prediction and my Uncle is suffering from the horrors of cancer.

Yet “investing” is indeed connected to making predictions. If you buy the stock of the XYZ company because according to all your data, they 1) make money, 2) they’re growing and 3) they seem to have a good product line, you are still “predicting” that this will continue into the future and you’ll be rewarded by either dividends, a rising stock price, or both. It can go wrong. Sometimes horribly.

The accuracy of predicting the future of a specific topic often just boils down to having rock solid info…

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