Inside the Crystal Ball : How to Make and Use Forecasts.
Title:
Inside the Crystal Ball : How to Make and Use Forecasts.
Author:
Harris, Maury.
ISBN:
9781118865170
Personal Author:
Edition:
1st ed.
Physical Description:
1 online resource (397 pages)
Contents:
Cover -- Title Page -- Copyright -- Contents -- Acknowledgments -- Introduction: What You Need to Know about Forecasting -- Chapter 1 What Makes a Successful Forecaster? -- Grading Forecasters: How Many Pass? -- Why It's So Difficult to Be Prescient -- Bad Forecasters: One-Hit Wonders, Perennial Outliers, and Copycats -- What Is "Success" in Forecasting? -- One-Hit Wonders -- Who Is More Likely to Go Out on a Limb? -- Consensus Copycats -- Success Factors: Why Some Forecasters Excel -- Does Experience Make Much of a Difference in Forecasting? -- Chapter 2 The Art and Science of Making and Using Forecasts -- Judgment Counts More Than Math -- Habits of Successful Forecasters: How to Cultivate Them -- Judging and Scoring Forecasts by Statistics -- Chapter 3 What Can We Learn from History? -- It's Never Normal -- What Does U.S. Economic History Teach about the Future? -- Some Key Characteristics of Business Cycles -- National versus State Business Cycles: Does a Rising Tide Lift All Boats? -- U.S. Monetary Policy and the Great Depression -- The Ghost of the Great Depression Has Returned to Haunt Business Forecasters -- The Great Inflation Is Hard to Forget -- The Great Moderation: Why It's Still Relevant -- Why Was There Reduced Growth Volatility during the Great Moderation? -- Chapter 4 When Forecasters Get It Wrong -- The Granddaddy of Forecasting Debacles: The Great Depression -- The Great Recession: Grandchild of the Granddaddy -- The Great Recession: Lessons Learned -- The Productivity Miracle and the "New Economy'' -- Productivity: Lessons Learned -- Y2K: The Disaster That Wasn't -- The Tech Crash Was Not Okay -- Forecasters at Cyclical Turning Points: How to Evaluate Them -- Forecasting Recessions -- Realizing You Are in a Recession -- Forecasting Recessions: Lessons Learned.
Chapter 5 Can We Believe What Washington, D.C. Tells Us? -- Does the U.S. Government "Cook the Books'' on Economic Data Reports? -- To What Extent Are Government Forecasts Politically Motivated? -- Can You Trust the Government's Analyses of Its Policies' Benefits? -- The Beltway's Multiplier Mania -- Could the American Recovery and Reinvestment Act of 2009 Create or Save over 5 Million Jobs? -- Multiplier Effects: How Real Are They? -- Why Are Some Assumed Output and Jobs Multipliers Larger Than Others? -- Why Government Statistics Keep "Changing Their Mind'' -- Living with Revisions -- Chapter 6 Four Gurus of Economics: Whom to Follow? -- Four Competing Schools of Economic Thought -- Minskyites: Should We Keep Listening to Them? -- Who Was Hyman Minsky? -- What Distinguished Minsky's Theories? -- Why Were Minskyites Largely Ignored for So Long? -- What Are Minskyites Telling Post-Great Recession Forecasters to Do Differently? -- What Should Forecasters Learn from Minskyites? -- Monetarists: Do They Deserve More Respect? -- A Quick Review of How the Money Supply Influences the Economy -- Criticisms of Monetarism -- Supply-Siders: Still a Role to Play? -- Some Studies on Supply-Side Economics -- Keynesians: Are They Just Too Old-Fashioned? -- Chapter 7 The "New Normal'': Time to Curb Your Enthusiasm? -- Must Forecasters Restrain Multiyear U.S. Growth Assumptions? -- Supply-Side Forecasting: Labor, Capital, and Productivity -- Are Demographics Destiny? -- Pivotal Productivity Projections -- Hysteresis? -- Capex to the Rescue? -- Technological Change to the Rescue? -- Chapter 8 Animal Spirits: The Intangibles Behind Business Spending -- Animal Spirits on Main Street and Wall Street -- Conference Board (CB) CEO Confidence Index (Wall Street) -- Business Roundtable (BR) CEO Economic Outlook Index (Wall Street).
National Federation of Independent Business (NFIB) Small Business Optimism Index (Main Street) -- Are the Business Optimism Measures Politically Biased? -- What Does Business Confidence Tell Us? -- Can We Base Forecasts on Confidence Indexes? -- Business Confidence and Inventory Building -- Judging Inventories -- How Do Animal Spirits Relate to Job Creation? -- If Animal Spirits Are Not Necessarily Driving Job Formation, What Else Could Be? -- Confidence and Capital Spending: Do They Move in Tandem? -- Capex Cyclicality -- Do Interest Rates Play a Big Role in Capital Spending? -- Are Capital Spending Plans a Useful Leading or Coincident Indicator of Investment? -- Animal Spirits and Capital Spending -- Chapter 9 Forecasting Fickle Consumers -- Making and Spending Money -- How Do Americans Make Their Money? -- Will We Ever Start to Save More Money? -- Why Don't Americans Save More? -- More Wealth = Less Saving -- Too Much Debt? -- Saving and the Overall Balance Sheet -- Interest Rates Were a Missing Link -- Do More Confident Consumers Save Less and Spend More? -- A Multivariate Approach to Explaining Savings -- Does Income Distribution Make a Difference for Saving and Consumer Spending? -- Pent-Up Demand and Household Formation -- Chapter 10 What Will It Cost to Live in the Future? -- Whose Prices Are You Forecasting? -- Humans Cannot Live on Just Core Goods and Services -- Sound Judgment Trumps Complexity in Forecasting Inflation -- Short Run Energy and Food Price Swings Are Often Caused by Supply Imbalances -- Evaluating Longer-Run Food and Energy Price Forecasts Is Important -- Consumption Substitution Between Core and Noncore Goods and Services Affects the Inflation Rate -- Monetarists Believe That Food and Energy Prices Have Only Limited Impact on Overall Inflation.
Should We Forecast Inflation by Money Supply or Phillips Curve? -- Hitting Professor Phillips' Curve -- A Statistical Lesson from Reviewing Phillips Curve Research -- How Important Is Finding NAIRU? -- Chapter 11 Interest Rates: Forecasters' Toughest Challenge -- Figuring the Fed -- Federal Open Market Committee -- What Is the Fed's "Reaction Function''? -- Is the Fed "Behind the Curve''? -- Can the Fed "Talk Down'' Interest Rates? -- Bond Yields: How Reliable Are "Rules of Thumb''? -- Rule of Thumb #1: The Real (Inflation-Adjusted) Yield on the Benchmark 10-Year Treasury Note Should Return to Its Long-Run Average Level -- Rule of Thumb #2: The Yield on the 10-Year Treasury Note Should Converge to the Rate of Nominal (Current Dollar) GDP Growth -- Professor Bernanke's Expectations-Oriented Explanation of Long-Term Interest Rate Determinants -- Supply and Demand Models of Interest Rate Determination -- Global Savings and Investment as Longer-Run Real Rate Determinants -- When Will OPEC, Japan, and China Stop Buying Our Bonds? -- What Will Be the Legacy of QE for Interest Rates? -- What Is the Effect of Fed MBS Purchases on Mortgage Rates? -- Will Projected Future Budget Deficits Raise Interest Rates? -- Chapter 12 Forecasting in Troubled Times -- Natural Disasters: The Economic Cons and Pros -- How to Respond to a Terrorist Attack -- Why Oil Price Shocks Don't Shock So Much -- Market Crashes: Why Investors Don't Jump from Buildings Anymore -- Contagion Effects: When China Catches Cold, Will the United States Sneeze? -- Chapter 13 How to Survive and Thrive in Forecasting -- Surviving: What to Do When Wrong -- Hold or Fold? -- Thriving: Ten Keys to a Successful Career -- About the Author -- Index -- EULA.
Abstract:
A practical guide to understanding economic forecasts In Inside the Crystal Ball: How to Make and Use Forecasts, UBS Chief U.S. Economist Maury Harris helps readers improve their own forecasting abilities by examining the elements and processes that characterize successful and failed forecasts. The book: Provides insights from Maury Harris, named among Bloomberg's 50 Most Influential People in Global Finance. Demonstrates "best practices" in the assembly and evaluation of forecasts. Harris walks readers through the real-life steps he and other successful forecasters take in preparing their projections. These valuable procedures can help forecast users evaluate forecasts and forecasters as inputs for making their own specific business and investment decisions. Emphasizes the critical role of judgment in improving projections derived from purely statistical methodologies. Harris explores the prerequisites for sound forecasting judgment-a good sense of history and an understanding of contemporary theoretical frameworks-in readable and illuminating detail. Addresses everyday forecasting issues, including the credibility of government statistics and analyses, fickle consumers, and volatile business spirits. Harris also offers procedural guidelines for special circumstances, such as natural disasters, terrorist threats, gyrating oil and stock prices, and international economic crises. Evaluates major contemporary forecasting issues-including the now commonplace hypothesis of sustained economic sluggishness, possible inflation outcomes in an environment of falling unemployment, and projecting interest rates when central banks implement unprecedented low interest rate and quantitative easing (QE) policies. Brings to life Harris's own experiences and those of other leading economists in his almost four-decade career as a professional economist and
forecaster. Dr. Harris presents his personal recipes for long-term credibility and commercial success to anyone offering advice about the future.
Local Note:
Electronic reproduction. Ann Arbor, Michigan : ProQuest Ebook Central, 2017. Available via World Wide Web. Access may be limited to ProQuest Ebook Central affiliated libraries.
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