div xmlns=”http://www.w3.org/1999/xhtml”pRegular readers of “A Dash” know that we have a strong interest in predictions — those based upon models, but also others./p

pMany investment heroes made a prediction without a time frame.  Our guess is that many readers would be surprised at a comparison of results between these forecasters and those who took the opposite viewpoint.  But that is a subject for another day./p

pWe also like looking at sports predictions.  This takes the investor out of the normal environment.  In sports there are many more instances.  One gets into “the long run” more quickly./p

pBriefly put, analyzing predictions from sports helps us to think objectively about economic and investment forecasters./p

pstrongAn Interesting Example/strong/p

pIn a recent baseball game, meaningless in the overall standings, one of the announcers for Seattle made a very specific prediction.  Take a look at the video./p

p/p

p/p

p/p

p/pobject allowfullscreen=”true” allownetworking=”all” allowscriptaccess=”always” data=”http://www.kaltura.com/index.php/kwidget/wid/_35168/uiconf_id/1002330″ height=”300″ id=”kp” name=”kp” type=”application/x-shockwave-flash” width=”400″param name=”wmode” value=”transparent”/paramparam name=”allowScriptAccess” value=”always”/paramparam name=”allowNetworking” value=”all”/paramparam name=”allowFullScreen” value=”true”/paramparam name=”bgcolor” value=”#000000″/paramparam name=”movie” value=”http://www.kaltura.com/index.php/kwidget/wid/_35168/uiconf_id/1002330″/paramparam name=”flashVars” value=”entryId=http://s3.amazonaws.com/lazyjock/115734.flvamp;autoplay=false”/param/objectdivpa href=”http://www.fandome.com” title=”Sports Videos, News, Blogs”img alt=”Sports Videos, News, Blogs” src=”http://www.fandome.com/img/poweredBy.png” style=”border: medium none ;”/img/a/ppThe initial reaction is — Wow!/ppstrongEvaluation/strong/ppThere are two very distinct ways of looking at this prediction.  The first is inspired by a href=”http://www.typepad.com/site/lists/6a00d83451ddb269e200e54fdee8f18834/item/6a00d83451ddb269e200e54fcbf18b8833/edit”Fooled by Randomness/a, a book highly recommended, and one that we sent to many clients./ppTaking this approach, we ask how many similar predictions are made each season.  Many broadcasting teams (all of them?) have a “pick to click” question.  The skeptical analysis would suggest that there were thousands of predictions, mostly inaccurate and ignored./ppIf a prediction works, then and only then does it get publicity.  We have no idea how many similar predictions never saw the light of day./ppOn the other hand, this particular prediction has a very high level of specificity.  The announcer predicted which at bat, what the count would be, that the pitch would be a fastball, that the hitter would connect for a home run, that it would be to left field, and that it would reach the second deck./ppThis is not just a run-of-the-mill pick to click./ppstrongInvestment Take/strong/ppWe are interested in comments on this example.  It seems dissimilar to most investing predictions because of the specificity./ppMost investment guru’s follow the key commandment:/pp style=”text-align: center;”emstrongDo not make a prediction that has both a target and a time frame!/strong/em/p/div/div
pa href=”http://feedads.g.doubleclick.net/~a/_IoBWQE4BL_BlT6edHc3Jz8C2-8/0/da”img src=”http://feedads.g.doubleclick.net/~a/_IoBWQE4BL_BlT6edHc3Jz8C2-8/0/di” border=”0″ ismap=”true”/img/abr/
a href=”http://feedads.g.doubleclick.net/~a/_IoBWQE4BL_BlT6edHc3Jz8C2-8/1/da”img src=”http://feedads.g.doubleclick.net/~a/_IoBWQE4BL_BlT6edHc3Jz8C2-8/1/di” border=”0″ ismap=”true”/img/a/pimg src=”http://feeds.feedburner.com/~r/typepad/WuQQ/~4/sKZATYebmyY” height=”1″ width=”1″/

Last 5 posts by Jeffrey Miller

• A Tough Nut to Crack - October 29th, 2009
• ETF Update: Looking to the Internet - October 25th, 2009
• Healthcare Reform Becoming Less Likely - October 21st, 2009
• ETF Update: Another Look at the Banks - October 18th, 2009
• Identifying Quackery (and Other Mistakes) - October 6th, 2009