When I grow up I want to be a Wall Street analyst. It has great job security because it never requires that you succeed in what you’re supposed to be doing.
Suppose you’re a doctor. You misdiagnose one patient after another and pretty soon you have no patients and maybe even lose your license to practice.
Or suppose you’re an attorney and you lose 50 consecutive cases. Pretty soon you have no more clients and might even find yourself the subject of a law suit.
No such professional pitfalls lurk for a Wall Street analyst. They are almost always wrong when predicting job losses, retail sales, home prices, et. al. Like astrologers they fiddle with arcane knowledge known only to themselves and employ elaborate mathematics to come up with guesses about the future that are invariably off the mark—often dramatically so.
Indeed, if you or I or virtually anyone else who peruses the financial press regularly were to make a guess about some future economic stat, you’d be just as likely to be right as these people. Or as likely to be wrong.
And this is easy to demonstrate. Read the Wall Street Journal online for the next couple of weeks and based on what you see there guess how many jobs will be reported lost this month by the Labor Department in February. At least half of you reading this commentary will be closer to the right number than the average number produced by the dozen or so analysts surveyed by Reuters or Bloomberg. Guaranteed.
How do analysts get away with it? How, after years and years of missing their designated targets, do they keep their high-paying positions? The answer is that far more richly compensated Wall Street guessers find them useful. These latter worthies need someone to blame when they lose the money we gave them to invest. It’s their game of CYA paid for by the rest of us.
Wouldn’t it be great to be a Wall Street analyst? To never have to worry about being fired in consequence of always being wrong?
(The writer’s website: wallstreetpoet.com)