A Quote by John Maynard Keynes
Investing is an activity of forecasting the yield over the life of the asset; speculation is the activity of forecasting the psychology of the market.
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Computer modelling for weather forecasting, and indeed for climate forecasting, has reached its limits.
The animal is one with its life activity. It does not distinguish the activity from itself. It is its activity. But man makes hislife activity itself an object of his will and consciousness. He has a conscious life activity. It is not a determination with which he is completely identified.
Part of my advantage is that my strength is economic forecasting, but that only works in free markets, when markets are smarter than people. That's how I started. I watched the stock market, how equities reacted to change in levels of economic activity, and I could understand how price signals worked and how to forecast them.
If I have noticed anything over these 60 years on Wall Street, it is that people do not succeed in forecasting what`s going to happen to the stock market.
Pundits are no better at forecasting election outcomes than they would be at predicting the final path of a hurricane. Smart pundits should consider either abandoning this activity or consulting with the geeks before rendering their guesses.
A market economy is a tool - a valuable and effective tool - for organizing productive activity. A market society is a way of life in which market values seep into every aspect of human endeavour. It's a place where social relations are made over in the image of the market.
Activity and rest are two vital aspects of life. To find a balance in them is a skill in itself. Wisdom is knowing when to have rest, when to have activity, and how much of each to have. Finding them in each other - activity in rest and rest in activity - is the ultimate freedom.
Whenever you try to pick market tops and bottoms, you are making a prediction. Guessing what stock is going to outperform the market is forecasting, as is selling a stock for no apparent reason. Indeed, nearly all capital decisions made by most people are unconscious predictions.
A way of life can be shared among individuals of different ages, status, and social activity. It can yield intense relations not resembling those that are institutionalized. It seems to me that a way of life can yield a culture and an ethics. To be "gay," I think, is not to identify with the psychological traits and the visible masks of the homosexual but to try and define and develop a way of life.
Economic forecasting has actually got pretty good over the years, though admittedly, we don't always get it right.
Economic activity, especially the activity of a market economy, cannot be conducted in an institutional, juridical or political vacuum. On the contrary, it presupposes sure guarantees of individual freedom and private property, as well as a stable currency and efficient public services.
I think that intelligent forecasting (company revenues, earnings, etc.) should not seek to predict what will in fact happen in the future. Its purpose ought to be to illuminate the road, to point out obstacles and potential pitfalls and so assist management to tailor events and to bend them in a desired direction. Forecasting should be used as a device to put both problems and opportunities into perspective. It is a management tool, but it can never be a substitute for strategy, nor should it ever be used as the primary basis for portfolio investment decisions.
What type of new economical system can organize this system? There is another sector in our life, that we rely on every single day, that are absolutely essential: the social commons, the social economy. It is all the activity we engage in to create social capital. It doesn't create capital market. Social commons is growing faster than the market place. It is growing faster than the market place. The social commons include any activity that is deeply social and collaborative.
Nate Silver is now forecasting Oscar winners. The only area of life in which he has no expertise, ironically, is life itself.
There are no violent gangs fighting over aspirin territories. There are no violent gangs fighting over whisky territories or computer territories or anything else that's legal. There are only criminal gangs fighting over territories covering drugs, gambling, prostitution, and other victimless crimes. Making a non-violent activity a crime creates a black market, which attracts criminals and gangs, which turns what was once a relatively harmless activity affecting a small group of people into a widespread epidemic of drug use and gang warfare.
I do believe it is important to be future-ready with a portfolio to be able to deal with however the market evolves. This is better than just forecasting accurately but in having the weapons ready to deal with the uncertainties.
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