The Same Conclusion

Amar Pandit , CFA , CFP

I received some wonderful responses to the post RIP Forecasting. If you haven’t read it yet, I urge you to read it now. While that post and this Nano are independent, they essentially make the same key point.

At the beginning of 2022, the Wall Street consensus was that the S&P 500 would reach 4,825 by December 31st, 2022. Goldman Sachs, J P Morgan, Morgan Stanley, Citigroup, Wells Fargo and every other institution had made forecasts ranging from 4500 to 5200. Guess where the S&P 500 ended 2022 at.


The point is no one has a clue. No one knows a thing.

They continue to play the guessing game and to create an illusion of expertise and knowledge.

In short, research reports are all about smart marketing.

But haven’t we known this all along?

In 1933, Alfred Cowles III wrote a journal article “Can Stock Market Forecasters Forecast?”, published by The Econometric Society.

What do you think was the conclusion here?

I bet you know the answer but here it goes anyway.

All of the attempts mentioned in forecasting the movement of both single stock price and the stock market have been proved to be unsuccessful.

The conclusion was true then and the same is true now. And the same conclusion will be true in the future too.