The reason you shouldn’t rely on what economists say to make decisions (for example in financial decisions) is because nobody grades an economist. As Howard Marks puts it, “Economists are like portfolio manager who don’t mark to market.” In other words, a source of predictions is only useful if it is reliably correct, but there is no way to know that about an economist because they don’t keep score.
- Naval Ravikant often says you shouldn’t trust someone who doesn’t have “skin in the game”
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Macro forecasting is an area where it is easy to be as right as the consensus, but very hard to be more right. This highlights that consensus macro forecasts provide no value—it doesn’t tell you anything everybody else doesn’t know so there is no information advantage.