Cephalopod’s death
Shows that outcome regardless
Forecasting is dumb

OK, it’s an awful haiku. But do consider for a moment the fate of Rabio, the psychic Japanese octopus.

Rabio successfully predicted the outcome of all Japan’s World Cup group stage games. The Samurai Blues were sent home by Belgium in the next round – whether Rabio would have predicted this too, we’ll never know. Whereupon his owner sent him to market, to be made into sashimi, because “he’d make more money selling it for food”.

And that was for getting his forecast right!

Two thoughts:

1. It’s about the dollar; it’s always about the dollar. I have an acquaintance who was fired from his job as a fund manager for telling customers – correctly, as it happens – that they should sell out of his fund.

2. If the fate of unsuccessful financial forecasters – active fund managers, pundits, stock-pickers, for example – was to be cut into small pieces, they might be less free with their opinions.

“When a man knows he is to be hanged in a fortnight, it concentrates his mind wonderfully.” (Samuel Johnson)

This article was originally published on the Navigator Financial Planning website.