This formula was developed back in the 1930 ‘s by Alfred Cowles 3rd, founder of the esteemed Cowles Foundation for Research and Economics. He developed this formula to determine whether or not stock market forecasters could consistently forecast the future of the stock markets.
Mr. Cowles thinking was, if, it could be demonstrated the existence of individuals or organizations abilities to accurately determine the fluctuations of either individual stocks or stocks in general, that this could lead to the identification of new economic theories and statistical practices.
They went to leading organizations, leading economists and statisticians to give it their best shot. As you can imagine, how upsetting this was to these “mystics” when their forecasts in predicting the future were no better than those picking stocks randomly.
Since then, and to this day, we hear of many organizations, analysts, economists and statisticians pontificating on which stocks to buy and or sell or how the economy will do in the next year. Some of this information can be useful in the hands of the right people and some of it only serves to create and increase worries and concerns to the most vulnerable Canadians, senior citizens.
Despite the power of the computer age, the consistent forecasting of stock market returns, bear and bull markets, the economy, is still unsolved. If they could consistently forecast these things, I would argue that, they, and we, would be multi billionaires at the very least.
LIVE WELL. INVEST INTELLIGENTLY.
FOR MORE INFORMATION CONTACT ROBERT ROBY AT: 343-291-1060(OTTAWA)