My forecasts are not infallible but they are highly dependable. Forecasts made by mainstream economists are more likely to be completely backwards with respect to what actually happens. Usually the higher the I.Q of forecaster; the more inaccurate will be the projection. In economics, raw intelligence dazzles students and impresses politicians and constituents. For making forecasts and coming up with economic policies, high raw intelligence is more of a detrirment than an asset.
My I.Q. is only high enough to allow me to do basic things that a minor league academic needs to do. An economist like Federal Reserve Chairman Ben Bernanke surely has an I.Q. somewhere in the high genius area. Yet, I am consistently right and he is consistently wrong. What accounts for the difference in results?
For a human being my level of awareness is extremely high and for explaining economic issues and making forecasts this gives me an unfair advantage over my much smarter counterparts. Awareness is a gift nature seems to gives to various creatures and this enables them to figure out what the truly brilliant among the earth’s inhabitants are going to do next.
Do you have a dog? Dogs have a much higher level of awareness than their masters. Your dog has what seems like an uncanny knowledge of what you are about to do next. The dog studies your every movement. Children are highly adept at gaming their parent’s moods and behaviors. Kids reason, “Dad is in a good mood, I’ll ask for some money.” Children lose their awareness when they get older. Awareness is a survival tool. Really smart people don’t need it so they either lose it or don’t have it.
Academic economists make poor forecasts because they do not consider any criteria that make a difference. In their minds one number causes another but numbers cause nothing at all. Human behavior is what causes numbers to change, so a good forecast is focused on human behavior and changes in incentives.
Keynesian theory is based on the notion that one number causes another. All fiscal and monetary theory is quite complex and out of reach for ordinary people. It is also completely useless for anything other than tracking what is going on with numbers.
When fiscal and monetary theories are used to formulate government policy any decision is a political decision and constitutes central economic planning. Resources are inevitabily allocated inefficiently. When government guides economic activity over a long period of time the result is an economic depression. Over time resources become so inefficiently allocated that the economy can no longer grow.
This is all one needs to know in order to conclude the world economy is about to collapse. The magnitude of the calamity will be much greater than can easily be fathomed at this point. All of the major economies around the globe have been severely handicapped by central economic planning. Economies cannot perform well enough to generate enough tax revenue to cover their debts. Every country in the world is facing a crisis at the same time.
For the most part the unsuspecting public has an unshakable faith in experts and government solutions. The writing is on the wall here. No asset class is safe to invest in. I am even reluctant to keep money in the bank. The time period we are entering is going to be nothing but every man for himself. The best I can come up with is is to compile a portfolio of short positions in stocks. This is the opposite of holding assets. I will benefit when assets lose value. So far, I am up 35% for the year.

The K.C. Moan A fine traditional tune from the depression era.