CoreLogic predicted home prices would decline by 6.6% in 2021 – and they were off a little.
Home prices appreciated by almost 20% in 2021!
What makes this enormous error so fascinating is the fact that CoreLogic is considered to be the granddaddy of data collection and analytics when it comes to the housing market.
But, boy did they whiff!
Fed Chairman Spectacularly Wrong
Prior to the 2008 housing crisis, the Chairman of the Federal Reserve, Ben Bernanke, insisted numerous times that the housing market was stable – with little reason for concern.
I think that was the world record for “wrongness.”
Paul Krugman Wrong
Paul Krugman is a Nobel laureate, a famous economics professor and a renowned columnist for the New York Times.
In the late 1990s, he famously said that the internet would have no more impact on the economy than the fax machine.
He also predicted that we would see a major recession and stock market correction if Trump got elected.
I knew someone who sold his stocks because of that prediction, only to see stocks go through the roof immediately after Trump was elected.
Krugman went on to predict major recessions again and again during the Trump era, and he was wrong every time.
Jim Cramer Wrong
Jim Cramer is the famous host of the CNBC show called “Mad Money.”
He notoriously told people not to sell Bear Stearns stock prior to its implosion.
More recently though (earlier this year) he recommended a long list of growth stocks – that have now dropped by an average of about 60% (in a year when the stock market boomed).
He also said oil prices would fall forever in late 2020 – only to see them shoot through the roof in 2021.
Barry Habib Wrong
Despite being the most accurate prognosticator out there, Barry predicted waning inflation, a bad recession and much lower rates for 2021.
Jay Voorhees Wrong
I have predicted that rates were going to go up about 137 times over the last ten years – only to see them fall again and again (shouldn’t have relied on “experts” 😊).
2022 Predictions Coming
Anyway, all kinds of predictions for 2022 are all over the media right now – from “experts” of every stripe.
And my advice is to ignore them all – given the extremely poor track records of pretty much everyone.
Because our economy is so manipulated right now (by the Fed and our government) and because we are in territory that nobody has ever seen before, nobody has a clue of what will happen in the future.
No matter how much expertise someone might claim to have, there is no way to have expertise in today’s uncharted waters.
The friend I mentioned above lost over $1 million because he listened to Paul Krugman.
When I was at Wells Fargo in the early 1990s, the bank lost millions because it listened to its chief economist who insisted, right before CA slid into a deep recession, that CA was “recession-proof” because the state’s economy was so diversified (not so much).
Anyway – the economy’s gonna do what the economy’s gonna do – no matter what our “experts” tell us.
Taking action or not taking action (like buying a home) based on an expert’s prediction can be very expensive and often unjustified.
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