Introductory note: For those of you who aren't aware of the past history of the bloggers here with Daily Kos, or don't want to hear more about it, please pass on. Regular economic blogging will resume tomorrow. For those of you who do, put some popcorn in the microwave or pour a nice libation and enjoy the following Sunday reading.
On November 6, 2009, I had the following exchange with Meteor Blades:
Me: I am challenging you on bias as a front pager.[my emphasis] By MB's own standard, it is appalling that he and others continue to accept the predictions of the Pied Piper of Doom.
Do you believe that those who "tell us what's likely to happen next" have any more than a random chance of being right?
MB's response: I think that one judges that by their record. Of course, as the stock analysts (are required to) say, past performance is no guarantee of future performance. What I find appalling is the willingness of so many people to accept the assumptions and predictions of economists who have proved to be so completely wrong on repeated occasions. That's not an indictment of all economists, even those who have been wrong. Only of those who are so f'n arrogant about their certainty.
by Meteor Blades on Fri Nov 06, 2009 at 06:58:48 AM PDT
While I was out Friday, a commenter asked permission to cross-post an article by Bonddad at Daily Kos (one that was also cross-published by Barry Ritholtz at the Big Picture yesterday). The predictable sh**storm ensued, but in due course I learned that many of you still read both blogs. At least one of you wished there were an official reckoning of the Doomers' wrongitude. I've had that reckoning sitting in my computer for over a year. Since another front-pager on that allegedly "reality-based" blog has apparently developed a severe case of amnesia and has embraced the position of
what poor prognosticating? once again, the prognostications i saw were that the stimulus was inadequate, hamp was a joke, and we'd pay a political price for it in 2010.now is a good time to set the record straight. I'll continue this on weekends as the spirit moves me. There is no point crossposting it at DK and I request that you not do so, at least until the entire record of over 100 false prophecies is laid out.
Herewith the beginning of the Reckoning:
For someone who believes the stock market shouldn't be used as an indicator of anything, he sure thinks it is an indicator of Doom!
1. No sooner had the market reached one of its all time bottoms, he waited less than a week before pronouncing, on March 13, 2009 that
MSM and the public are grasping at straws. The market goes up 200 pts. Someone puts up $11 billion--the equivalent of chump change in the marketplace--to buy bonds (a very tiny sale, btw). And, a report comes out that says: consumer purchases didn't drop as much as everyone expected?.... All the pundits are saying 2010 to 2011 before there's any upturn...at best! This is what's known as: a.) "bottom bouncing," and, b.) a "sucker's market," which is just what was and is being predicted by many over the past few months.That was the beginning of a 6500 point rally on the DJIA, in which it has since doubled and reached a 4 year high. He was wrong.
2. At the end of March, he was still convinced that
The truth is, many are of the opinion that this is nothing more than a "sucker's rally;" which is also referred to as "bottom-bouncing" in a bear market....He was still wrong.
there's really little rational reason--other than spin--for the markets to be up right now.
3. In April 2009, he claimed that
Crash and Burn? A Strong Case That Recent Market Upswings Were Illusion.This was the first of many times that following the short-side hedge fund blog Zero Hedge led him down the primrose path.
He was wrong.
4. On that same day, he claimed that:
As Roubini noted a few months ago, it may reach a point where all market trading might stop, completely, at least for a few days or weeks. Durden concludes with a quote from a trader telling us this event could occur as early as this week.He was tinfoil hat moon made of green cheese wrong.
5. On May 11, 2009, he thought that the stock market rally since March had reached its peak:
BTW, I think the sucker's rally is ending today...maybe...a lot of people have been taken for a ride the last 8-9 weeks.He was wrong.
6. The very next day, May 12, 2009, he said that he had
Shifted to 75% Cash/Bonds Friday!because he agreed with Gjohnsit's position that
The rally is done. .... If you are buying now you are simply giving your money away. Now is the time to go to cash. Maybe in a few months things might be different.Commenter Ticket Punch wished him luck. Ticket Punch was right. The PPoD was wrong.
7. On August 19, 2009, he again claimed that a market crash was near
Yves Smith, who is, arguably, one of the more calm, evenhanded and liberal Wall Street pundits in the blogosphere has let loose today, in: "Is This the Start of the Big One?" If you read her Naked Capitalism blog frequently, you'll realize this is quite out of character for her. There are some statements she makes here with which I'm not in full agreement--for instance, the Federal Reserve and the Plunge Protection Team, a/k/a "The President's Working Group On Capital Markets," simply will pull out all the stops to prevent a market crash as they have in the past--but there is much of what she says today with which I now concur.There was no need for a "plunge protection team." There was no crash. Yves Smith was wrong. So was he.
8. On August 24, 2009, he once again called for a stock market crash, claiming:
This market's going to crash very, very hard...sometime in the next few months, IMHO.As with all his other predictions of a stock market crash, he was wrong.
9. At the end of November 2009, he said:
about 10 days ago, Whitney also had this to say: "CNBC: Stocks Overvalued, Recession Will Return: Meredith Whitney"That was about 3000 DJIA points ago. Whitney was wrong. So was he.
10. He got out of the "stock market's gonna crash!" business after that, but you can still make a lot of money if you use the Pied Piper of Doom as a contrarian indicator. Just last October 3, he proclaimed:
You might not know it yet, but the U.S. has just entered into another recession, according to the world’s (arguably) leading expert on economic business cycles. And, when it comes to this type of thing, the guy’s never been wrong.That was 2000 DJIA points ago. Q3 GDP was 1.8%, and Q4 was just raised to 3.0%. ECRI's initial call was wrong. So was the PPoD.
it’s now quite self-evident, especially given the inconvenient business/economic news of the past 72 hours, noted down below, that we have already entered into another recession.
In fact, the world’s (arguably) leading expert on business cycles, Economic Cycle Research Institute Co-Founder Lakshmann Achuthan, has just called it. We are in a recession…again! And, he’s been about 100% accurate on his calls since…forever.
Done freakin’ deal..... Achuthan [ ] tells us we’re already in a Recession; we just don’t know it yet.) Meanwhile, here’s my commentary from a little over three weeks ago (see last link in paragraph immediately above)…
…“The ‘recovery’ that may be no longer.”
That's just the first 10. There are at least 90 more false prophecies, on plenty of other economic topics, where those came from. Needless to say, to be continued .... and continued ... and continued ...