Stock Market Predictions Gone Bad

Just seven days before the stock market crash of 1929, economist Irving Fisher said, “stock prices have reached what looks like a permanently high plateau.” Over time, Fisher’s contribution to economics has been lauded, but his spectacular miss on the Great Depression dogs his legacy.*

Back in 1999, Charles W. Kadlec, then chief investment officer for old-line investment firm J.W. Seligman, said the Dow Jones Industrial Average would be 100,000 by 2020. With one month to go, he’s not wrong yet.**

From August 23, 2000 to December 31, 2001, Enron stock went from $90 to 6.2 cents. Yet, just a little more than two months prior, Lehman Brothers analyst Richard Gross said Enron was a strong buy, and ‘the stock should recover sharply.” This kind of call puts Lehman’s demise seven years later into perspective.


Join our newsletter

Sign up today for free weekly updates on senior health and finance news.

And don’t worry, we hate spam too! You can unsubscribe at anytime

Whitney Tilson, when a partner at an asset management firm, advised investors against buying Google shares when it went public in 2004.*** Google’s return since its IPO based on the price at the end of November? More than 1,400%!****

Sometimes, the prognosticators get it right. Economist and NYU professor Nouriel Roubini said in a speech before the International Monetary Fund in September 2006, “ . . . my concern today is that the bursting of the housing bubble—we have not seen it yet—is going to lead to broader systemic banking problems.” *****

Sadly, it seems, there were few takers for Roubini’s prediction.

* Anonymous, (2017). Irving Fisher. Policonomics. Retrieved November, 2019
** Carlozo, Lou, (August, 2017). 10 Worst Wall Street Opinions in History. GO Banking Rates. Retrieved November, 2019
*** Anonymous (2019). Whitney Tilson. LinkedIn. Retrieved November, 2019
**** Anonymous (2019). Google IPO Price. Google. Retrieved November, 2019
***** Cox, Jeff (July, 2014). Best and worst predictions of the past 25 years. CNBC. Retrieved November, 2019