Last Year’s Lessons

John Noonan Uncategorized Leave a Comment

We’ll get right to the point:

In investing, forecasts and predictions are worthless.

And probably, “in anything”. But for our purposes here, no one in history has been right more often than wrong in such a quantity that would force the rest of us to acknowledge the existence of a true fortune teller.

Of course, a look into all past predictions is required to make this assertion. We’ve certainly written enough about it over the years to make the case. And the folly of forecasting is no secret. But a full thesis this is not. Rather, we prefer to pick on 2024, as this is, after all, a year-in-review piece. And last year was a doozy!

Here we have last year’s S&P 500 return vs what everyone guessed:

Great Oak Capital Partners - 2025.02b

As Homer Simpson would say, Doh! Oh, JP Morgan. That’s a rough one. But fret not! As it turns out, all you need to do when you are wrong is say the opposite six months later:

Great Oak Capital Partners - 2025.02a

It took Goldman a few more months, but hey – why not wait for an extra 8%* run-up just to make sure, right?

We promise no Buffett quotes this time. Only Homer made the cut. We think the data is plenty to make the point. But if any of you can come up with a new, original quote about the folly of forecasting, we’d love to hear it!

Cheers,

Your Team at Great Oak

 

*Extremely rough guess

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