Alan Greenspan was interviewed recently by Jon Stewart on US Television. Amongst the things he said was:
I've been dealing with these big mathematical models of forecasting the economy, and I'm looking at what's going on in the last few weeks. â€šÃ„¶ If I could figure out a way to determine whether or not people are more fearful or changing to more euphoric, and have a third way of figuring out which of the two things are working, I don't need any of this other stuff. I could forecast the economy better than any way I know.
"The trouble is that we can't figure that out. I've been in the forecasting business for 50 years. â€šÃ„¶ I'm no better than I ever was, and nobody else is. Forecasting 50 years ago was as good or as bad as it is today. And the reason is that human nature hasn't changed. We can't improve ourselves.
So answer me this question. Why do we pay people so much to do this when we know they get it wrong?
Actually, the interview is well worth watching for amusement value alone. It's available here.