Bad Media Calls of 08: Did They Really Say That?
There were plenty to choose from, including from us.
By Elizabeth Ody, Associate Editor
From Kiplinger's Personal Finance magazine, February 2009
- Comments
- Email This Article
- Print This Article
- Order a Reprint
Advertisement
What a year. The economy nosedived. U.S. stocks lost 38% of their value. And those of us who earn a living trying to peer into the future had our comeuppance. Along with all the bad news, the panic of '08 will be remembered for a bumper crop of wrong predictions from pundits, prognosticators, and analysts of all stripes. Here are a few bloopers from a year that turned out to be a bust on many levels. See if you agree.
Larry Kudlow, economist and syndicated columnist.
What He Said: "With the U.S. dollar up and oil down and businesses investing, I think [the] Goldilocks [economy] is back in business." – August 28,2008 CNBC’s Kudlow & Company
What Happened Next: Several weeks later Lehman Brothers filed for Chapter 11 bankruptcy protection and signed an agreement to be taken over by Barclays PLC.
What He's Saying Now: "Who knew about Lehman, AIG and the LIBOR [interbank-lending] freeze? But we will see Goldilocks again."
Worth Magazine
What The Magazine Said: "Emerging markets are now the global investors’ [sic] safe haven of choice." – April/May 2008
What Happened Next: Emerging-markets stocks shed 52% of their value in 2008, through December 19.
What They're Saying Now: Nothing [Worth didn’t respond to our request for comment].
Kiplinger's Personal Finance Magazine
What We Said: Stock investors should "beat the rush to the banks."– November 2008
What Happened Next: The banking industry has come to the brink of collapse over the past few months.
What We're Saying Now: "We grossly underestimated the risks of these companies, but at least all our picks are still in business."- Elizabeth Ody, author of this article.
Suze Orman, Financial advisor and author.
What She said: "If any of you have your money at brokerage firms in a money-market [mutual] fund that is not FDIC-insured, you better switch it out today to either a money-market account that’s insured, a bank that has FDIC insurance, or a money-market fund that invests in Treasuries." – September 23, 2008, The Oprah Winfrey Show
What Happened Next: The U.S. Treasury had already announced a guarantee of money-market mutual funds. Wouldn't a run on these funds help fuel a financial meltdown?
What She's Saying Now: "It is far better to be safe than sorry."
- Comments
- RSS
Permission to post your comment is assumed when you submit it. The name you provide will be used to identify your post, and NOT your e-mail address. We reserve the right to excerpt or edit any posted comments for clarity, appropriateness, civility, and relevance to the topic.
View our full privacy policy
Reader Comments (2)
Posted by: RobK at 12/30/2008 09:15:56 PM
Let's see. This takes a swipe at Forbes, Fortune, Barron's, Worth, and TheStreet.com. Very self serving. What about the 4,567 or so dead wrong predictions from Kiplingers? You could only find one to highlight? Hypocrite...
Posted by: Bob at 01/12/2009 10:41:15 AM
As someone who earned over 100% on his retirement funds last year, I should be pounding my chest. But in fairness, I went short after getting pessimistic about the real estate bubble two years too early and had mediocre returns in 2006 and 2007. Overall, I've done well, exceedingly well compared to everyone else. But suffice it to say, forecasts are inherently problematic. Greenspan famously declared the markets to be "irrationally exuberant" in 1996, four years before the markets awoke to that fact. The best forecasting advice to bear in mind is the adage: "On a short-term basis, the markets are a popularity poll; on a long-term basis, they're a weighing scale." Eventually, markets will reflect a sane assessment of equity valuations. But you may have to wait quite a while for that to happen. I'm glad I was sufficiently patient to wait it out.