Mainstream macro-econometric models such as the Fed’s FRBUS model are known to be very bad at predicting major turning points. Meanwhile expert “judgment” is often simply the biased opinion of one individual, based on a selective and impressionistic reading of similar events in history.
There are perverse incentives to stand out from the crowd by reaching eye-catching conclusions. Perhaps some individuals are expert enough to outperform the market in such activities, but the seminal work of Philip Tetlock suggests that it is rather difficult.
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