National Economy Prediction Model
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A National Economy Prediction Model is a economic prediction model that can make a national economic prediction for a national economy.
- Context:
- It can be based on a National Economic Performance Measure.
- Example(s):
- Counter-Example(s):
- See: The Great Depression, The Great Recession of 2007-2009.
References
2013
- http://greenbackd.com/2013/03/25/warren-buffett-and-john-hussman-on-the-stock-market/
- QUOTE: … My point is that there are a variety of highly predictive, methodologically distinct measures of market-level valuation (I used the Shiller PE and Tobin’s q, but GNP or GDP-to-total market capitalization below work equally as well) that point to overvaluation.
The popular price-to-forward operating earnings measure does not point to overvaluation, but is flawed because forward operating earnings are systematically too optimistic. It’s simply not predictive, mostly because it fails to take into account the highly mean reverting nature of profit margins.
- QUOTE: … My point is that there are a variety of highly predictive, methodologically distinct measures of market-level valuation (I used the Shiller PE and Tobin’s q, but GNP or GDP-to-total market capitalization below work equally as well) that point to overvaluation.