Why the Economy is as Undependable as the Weather

Why the Economy Is As Undependable As the Weather

Isn't it interesting that the same people who laugh at science fiction listen to weather forecasts and economists?
- Kelvin Throop III, grandson of a likely fictional character of disputed origin, possibly Canadian (in other words, origin uncertain)

No matter where in the world people live, they all complain of the inaccuracies of their weather forecasters.

No matter where in the world people live, they are also feeling the effects of the economic downturn, despite the accumulated expertise of noted economists.

Why are weather forecasts so often wrong? In my country, Environment Canada (the government weather service) claims it is right 89 percent of the time. And it is, if you count only forecasts made within the previous three hours of any given time.

Weather and climate may follow general patterns, but they do not adhere to weather charts nor necessarily follow computerized climate models. As technologically advanced as we are in the 21st century, our meteorologists and climatologists know with certainty as much about the accuracy of their forecasts as doctors know about the human body. Which is very little despite their claims to the contrary.

Have you ever taken the time to watch dust moving around in a puddle or fog swirling on a summer morning? They defy accurate description. I have watched waves on the lake near where I used to live approach each other from opposite directions, then continue on by passing through each other as if the other weren't there at all. Shouldn't they cancel each other out? They don't. Waves are an effect of weather above them.

The economy of a country depends on so many factors that no one person or computer can keep track of them all. The current recession began when unethical bank officers granted mortgages to people who could not afford to pay them back, even though the interest rates were below the prime lending rate. The banks then sold these "loser" papers to other banks around the world, combined with good mortgage papers. Somebody had to pay. Turns out we all did.

Remember the dotcom collapses several years ago where internet startup companies collected fortunes with little more than a dream to sell? Or the Worldcom and Enron collapses (among others) where their executives stated profits and sales increases in the 30 percent range when they were only a fraction of that?

A great deal of the economy of a country depends on the honesty and integrity of those who move money around it. Stripped to its essentials, an economy functions on the greed and honesty of those with money. In the end, greed always dominates.

So weather forecasts are based on factors we don't even understand, while economic forecasts depend on the integrity of those with money. Is it any wonder that neither can be depended upon?

As for science fiction, some of it from the past may be seen in technology today?

Yet that's not the point of Throop's quote. His point is that many people will believe forecasts created by those who claim to be experts, while deriding technological and cultural forecasts from sources such as writers of science fiction. Science fiction writers don't claim to be experts.

Anyone who claims to have expertise in any subject will find followers provided that they can back up their predictions with good stories.

Weren't snake oil salesmen of the past successful because they told the best stories? Are our biggest advertisers today not successful because they tell the best lies that appeal to our vanity and need for social status? Didn't our ancestors believe the tribal chiefs and medicine men and women who told the best stories?

We tend to believe those who tell the most convincing stories, whether the stories have truth and validity or not.

So it rains on our parades and our retirement nestegg stocks tank. Our lives remain determined largely by our beliefs.

Bill Allin
Turning It Around: Causes and Cures for Today's Epidemic Social Problems, a guidebook for teachers and parents who want to grow children who believe what they can depend on.
Learn more at http://billallin.com