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Random thoughts – keeping you on your toes

Predictions

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The new year commenced a week ago. During the past few weeks the media is full of looks back and forward. The commentators, analysts and subject matter experts estimate what will happen in the future and/or what will be a consequence of something that happened during 2019.

Predictions can be used to guide our behaviour. Theoretically, past behaviour can be a predictor of future behaviour. Unfortunately it is also true future behaviour may be total unrelated to the the past.

Speculating how to leverage future events to our advantage is a little bit like gambling. Predictions create the underlying logic that helps us believe we are making rationale choices.

The Economy

The Canadian economy, in essence key impacts on jobs and income, Can be a telltale sign of posperity to come, or lack thereoff.

This can be a self fullfilling prophecy. When consumers believe income risk is low and product availability and pricing prospects are good, then the propensity to consume rises.

Greater demand fuels the need for greater supply and voila the market economy spirals up. So, what the population believes lies ahead in the future can in fact influence the future.

Propaganda can be used by governments and corporations to drive desired behaviours. This works to a point but, often and some time in the cycle, reality rudely intrudes and crash.

All the predictions and proclaimations lose their shine and credibility. Smoke and mirrors can work for a while but ultimately reality intrudes.

So what is in store for 2020. Who knows for sure. Based on the past year though my call would be whatever happens it will be unpredictable.

 

 

Random thoughts – keeping you on your toes

Predicting the Future

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” What is? is. What was? will be. What will be *was*, but will be again.”

Quoted from an episode of the TV show “Welcome back Kotter”

The basic logic of this quote is that events occur in cycles.  The only thing you can be sure of is the current cycle, (what is) but predictably the past will be back.

Past Behaviour Predicts Future Behaviour

Analysing past behaviour to determine the future is not an absolute and investment advisors ( to pick an example of a profession frequently trying to predict) regularly provide caution about using this approach to determine which funds or equities to purchase.

They advise, there is a real risk upcoming events will be unique and not influenced by historical at all.  For example, the government might introduce a new tax or policy that impacts behaviour.

Balanced Predictions

Past behaviour has been a proven predictor of future behavior in a number of psychology studies I have read.  That being said, the unexpected does occur and can significantly impact a future event.

Given  both these factors can have an influence on future predictions,  it is the balance you draw between behavioural predictability and the unexpected that will drive the accuracy of your predictions.

The future predictions you make will have a risk of inaccuracy, but careful consideration of past behaviour, event cycles and possible unexpected occurances should enable you to have some confidence in your forecast.

This is a bit contextual as some things are clearly more volitile than others, and so harder to predict.

Most pragmatically, what is: is ; what was: was and what will be: will be.  As the pseudo Spanish lyrics say, que sera sera (whatever will be, will be).  The future is not ours to see.