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Contest: Most Accurate Forecast of the Current Recession

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  • Contest: Most Accurate Forecast of the Current Recession

    Most Accurate Forecast of the Current Recession

    Inflation at highest rate in 26 years
    Jan. 16, 2008 (Denver Post)

    Signs that the U.S. economy is headed toward recession — or is already there — gathered steam Tuesday amid a maelstrom of reports that drove the Dow Jones industrial average down 277 points to a nine-month low.

    Retail sales plunged in December, Citigroup announced the biggest quarterly loss in its 196-year history and thousands more job cuts were revealed, rattling Wall Street and pushing the yield on the 10-year U.S. Treasury note near a four-year low.

    Former Federal Reserve Chairman Alan Greenspan was quoted as saying the economy may already be in a downturn, and one analyst called it "almost indisputable now" that the economy contracted in December.


    The recession is not limited to the US.
    Singapore economy contracted in Q4

    Singapore's economy shrank in the fourth quarter of 2007 as manufacturing growth shuddered to a near halt, official data showed Wednesday, raising concerns about the Asian impact of US economic woe.
    The US recession we forecast to start in Q4 2007 started December 2007 as our October 2006 forecast projected, more than a year before the event. We also projected that the recession was to be attended with high inflation rates, and here they are, the highest "in 26 years."

    In a shameless effort to publicize our spot-on forecast, we are running a new contest.

    The first registered iTulip member to find an equally or more accurate forecast wins an English gold sovereign. The standard for the English monetary system for centuries, the gold sovereign contains 0.2354 oz of gold. At the time of this posting, a gold sovereign sells for $231 retail in the US.

    To qualify, the forecast needs to meet the following criteria to meet or beat the iTulip forecast for accuracy:
    1. Must be posted on or before Oct. 27, 2006 when the iTulip forecast was posted. Date of posting must be provable using archive.org.
    2. Must clearly state that the recession will begin in Q4 2007 not "may begin" or "might if X, Y, Z occurs" but a definitive "will begin" in Q4 2007.
    3. Most clearly specify the quarter Q4 not any other quarter in 2007 or the entire year 2007.
    4. Must clearly specify that inflation conditions will be high going into the recession and use the term "stagflation" to describe the conditions.
    5. The forecast cannot be the result of random guessing by a bunch of contestants on another web site. It has to be based on actual economic analysis.
    6. No stopped clock forecasts; the Q4 2007 forecast cannot be one of a string of recession forecasts over the past three years.
    If all six conditions are met and you are the first to find such a forecast, you win by being the first to post a link to it on this thread. Multiple posts are allowed.

    This contest was re-opened Dec. 2, 2008 and the thread closes for new posts in two weeks from that date. Good luck!

    (Sorry, iTulip employees, contractors, writers, sponsors, and affiliates are not eligible.)
    Last edited by FRED; 12-02-08, 06:04 PM. Reason: Extended a week and no repeats" qualification.
    Ed.

  • #2
    Re: Contest: Most Accurate Forecast of the Current Recession

    Check the names in this post:
    http://calculatedrisk.blogspot.com/2...-start-of.html

    Nicholas Weaver said October 2007, and with no qualifiers like if,maybe, and x,y, z, blah, blah, blah.

    you'll see my name in there for Nov 2006. I was obviously very early.

    The post and conversation was October 2005. No way anyone can top that. Where's my gold!?

    Uncle Jack
    It's all fun and games until someone loses an eye!

    Comment


    • #3
      Re: Contest: Most Accurate Forecast of the Current Recession

      Hey, Fred, whichever one is manning the ship, please put up a link to EJ's original call.

      Thank you.
      Jim 69 y/o

      "...Texans...the lowest form of white man there is." Robert Duvall, as Al Sieber, in "Geronimo." (see "Location" for examples.)

      Dedicated to the idea that all people deserve a chance for a healthy productive life. B&M Gates Fdn.

      Good judgement comes from experience; experience comes from bad judgement. Unknown.

      Comment


      • #4
        Re: Contest: Most Accurate Forecast of the Current Recession

        Originally posted by Uncle Jack View Post
        Check the names in this post:
        http://calculatedrisk.blogspot.com/2...-start-of.html

        Nicholas Weaver said October 2007, and with no qualifiers like if,maybe, and x,y, z, blah, blah, blah.

        you'll see my name in there for Nov 2006. I was obviously very early.

        The post and conversation was October 2005. No way anyone can top that. Where's my gold!?

        Uncle Jack
        Okay, obvious qualification. The forecast cannot be the result of a random guessing by a bunch of contestants to some other site's contest. That's not a "forecast" that's a "guess." It has to result from economic analysis. iTulip was not guessing. Sheesh.
        Last edited by FRED; 01-16-08, 01:28 PM.
        Ed.

        Comment


        • #5
          Re: Contest: Most Accurate Forecast of the Current Recession

          Originally posted by Jim Nickerson View Post
          Hey, Fred, whichever one is manning the ship, please put up a link to EJ's original call.

          Thank you.
          Four part series starts here.
          Ed.

          Comment


          • #6
            Re: Contest: Most Accurate Forecast of the Current Recession

            This prediction was very close from August 2006:
            http://www.coloradoeconomy.com/downl...st07_FINAL.pdf

            Sorry it's a .pdf so I can't copy and paste any portion, but it forecasts recession beginning in late 2007, and spilling into 2008 with 3 plus percent official government inflation numbers. Says recession is a question of when, not if, and predicts a hard landing. Because technically speaking we cannot be in a recssion until 2 quarters of declining GDP, is this contest a little early? By definition, the recession cannot start until 1st quarter 2008, right (i.e., presumed 2nd quarter of declining GDP)?

            Comment


            • #7
              Re: Contest: Most Accurate Forecast of the Current Recession

              Originally posted by FRED View Post
              Okay, obvious qualification. The forecast cannot be the result of a random guessing by a bunch of contestants to some other site's contest. That's not a "forecast" that's a "guess." It has to result from economic analysis. iTulip was not guessing. Sheesh.
              Fred you are turning into a real nitpicker

              Comment


              • #8
                Re: Contest: Most Accurate Forecast of the Current Recession

                Originally posted by RickBishop View Post
                Fred you are turning into a real nitpicker
                He just trying to hang on to EJ's gold.
                Jim 69 y/o

                "...Texans...the lowest form of white man there is." Robert Duvall, as Al Sieber, in "Geronimo." (see "Location" for examples.)

                Dedicated to the idea that all people deserve a chance for a healthy productive life. B&M Gates Fdn.

                Good judgement comes from experience; experience comes from bad judgement. Unknown.

                Comment


                • #9
                  Re: Contest: Most Accurate Forecast of the Current Recession

                  Originally posted by rdgmail View Post
                  This prediction was very close from August 2006:
                  http://www.coloradoeconomy.com/downl...st07_FINAL.pdf

                  Sorry it's a .pdf so I can't copy and paste any portion, but it forecasts recession beginning in late 2007, and spilling into 2008 with 3 plus percent official government inflation numbers. Says recession is a question of when, not if, and predicts a hard landing. Because technically speaking we cannot be in a recssion until 2 quarters of declining GDP, is this contest a little early? By definition, the recession cannot start until 1st quarter 2008, right (i.e., presumed 2nd quarter of declining GDP)?
                  A very good report–thanks for sharing it with us. Close but no cigar, or gold. It says:
                  Economic Forecast 2007

                  The crystal ball remains cloudy, as always, but it indicates that the current situation is unstable and unsustainable for another 18 months. We attach a 75% probability to the onset of a recession before 2007 comes to an end and only a 25% probability to the continuation of the expansion, albeit at an ever-slowing rate.
                  They needed to watch the duration of unemployment and permits issuance numbers primarily to predict this recession. The next recession will be different so something else will have to be measured, so there is never one magic set of measurements that works in every case.
                  Ed.

                  Comment


                  • #10
                    Re: Contest: Most Accurate Forecast of the Current Recession

                    Hey I think the Baltic Dry Index did a decent job of predicting a recession.;) Ok ok, it's not really a prediction, especially when the index is dropping in "real-time" with the recession.

                    These contests... I know it's supposed to be challenging or you'd have to give away a lot of gold coins, but, I think the numerous, specific qualifiers are a little spurious. Talk about betting against the house. Ooh look, a chance to win a gold coin! But..... there's no chance anyone could actually win. Has anyone won the last contest? I didn't think so. Just my opinion. [shrug]

                    Comment


                    • #11
                      Re: Contest: Most Accurate Forecast of the Current Recession

                      Originally posted by zoog View Post
                      Hey I think the Baltic Dry Index did a decent job of predicting a recession.;) Ok ok, it's not really a prediction, especially when the index is dropping in "real-time" with the recession.

                      These contests... I know it's supposed to be challenging or you'd have to give away a lot of gold coins, but, I think the numerous, specific qualifiers are a little spurious. Talk about betting against the house. Ooh look, a chance to win a gold coin! But..... there's no chance anyone could actually win. Has anyone won the last contest? I didn't think so. Just my opinion. [shrug]

                      Oh, the cynicism! Actually, we've given away plenty of coins in previous contests.

                      The votes are in for the last contest. As soon as one of the banks noted issues the 100 year mortgage the winner will get the coin. It's just a matter of time.

                      As for this contest, the conditions are reasonable: the forecast has to have been posted before ours to eliminate the possibility that it's a copy, must be provable using archive.org so that someone doesn't now post a back-dated prediction, must be definitive and unconditional as vague and conditional forecasts are a dime a dozen, must be as specific as we were that inflationary conditions are part of the recession set-up as spurious "deflation" predictions are a dime a dozen, has to be the result of analysis not one of dozens of random guesses of which only one was correct, and no stopped clock forecasts as in it cannot be one of a string of recession forecasts over the past three years, one of which was bound to be correct.

                      If you can tell us why any of these criteria is not valid, we're all ears. If anything the list suggests just how hard it is to get the timing and define the character of a recession as accurately as this one. Our key advantage is that we've been doing it for a while.
                      Ed.

                      Comment


                      • #12
                        Re: Contest: Most Accurate Forecast of the Current Recession

                        Fred:

                        In looking at the contest rules, I can't tell that Itulip's (Eric's) October 2006 prediction ( http://itulip.com/forums/showthread.php?t=550 ) meets your contest criteria. As far as I can tell, the only date of the recession prediction in October 2006 was "2007." Can you direct us to an Itulip link in October 2006 that gives a 4q 2007 prediction? Not trying to take anything away from iTulip's great analysis or conclusions, which have been spot-on; but I'd like to see the specifics.

                        Thanks for all the great information- keep up the good work. As for the contest, hope I find an earlier recession prediction as I could really use that gold to help pay my negative amortization ARM (kidding).

                        -Rob

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