1652313036931 B 2009 Editors Letter

Fruitcakes and Forecasts

Dec. 18, 2009

Has this gut-wrenching economy touched bottom?

Is it on the way up? When will vacancy rates decline? When will interest rates rise? What will be the shape of the economic recovery? Will it be like a V on a fever chart, or will it slouch along the x-axis like the bottom leg of an L?

By the start of the new year, I’ve read a pile of forecasts, and, of course, no two seem to be in agreement on such questions. My taste for them is about the same as it is for the untouched gift of fruitcake in its colorful tin on top of the refrigerator.

Given the risks in this gamblers’ game of forecasting, I’m flummoxed by the swaggering confidence of many pundits in their predictions. Still, they typically include hedges like “on the other hand” or “then again” in their forecasts. Such ploys facilitate tomorrow’s neat explanation for the inaccuracy of yesterday’s forecast.

Economists are often the butt of jokes about their not having a sense of humor, but I think anyone who can insist on decimal points in a forecast – and keep a straight face – must possess a very wry humor.

Despite the hazards of making predictions, I will risk one of my own for 2010: Attitude will trump decimal points, and those who can focus on opportunity rather than calamity will have a more profitable and productive year.

Chris Olson
Editor in Chief

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