Yes, I guess predictive is a bit much for TA...but that is what it is intended to do, as Murphy points out.
My wife and I have a running battle on the role of Economics, which she calls a "soft" science. I point out to her the role of science is EXPLANATION, not prediction. Unfortunately, in physics and chemistry, so much is predictable that we've come to expect "hard" sciences to be predictive. I'd argue that Economics IS predictive within limits. What makes "hard" sciences predictive is the fact that they work in fairly stable environments such as a lab. Unfortunately, Economics labs are the very economy we are seeking to predict...and since they are dynamic, they are impossible to stabilize and make predictions. People often forget that.
Add to all this the psychological factors behind "do I buy/sell, save/spend?" and you're left with a highly unstable situation.
We know the basic rules of supply and demand, we know how misinformation effects market failure. We know all this. But as you pointed out...it's like predicting the weather.
I made a comment in a class ages ago that I think sums it up. I said that econometric predictions are only as good as your ability and willingness to update data and make revised viewpoints. That's how I've always dealt with the management of my sales' teams goals.
BTW, I'm fairly certain I mentioned I had a degree in Econometrics in my original post...I wasn't meaning to sandbag at all. |
