A4 - Wednesday, December 28, 1983 - North Shore News

usual.

With the remarkable local
exception of Richard
McAlary’s Economic
Analysis of B.C. put out by
the B.C. Central Credit
Union — an exception which
only proves the rule —
economic forecasts in the last
five years have tended to be
so far wide of the mark as to
be laughable.

According to Edwin Dale,
a spokesman for the U.S.
government’s budget depart-
ment, ‘‘lousy forecasts’’ are
making it all but impossible
to steer any nation’s
economy, regardless of how
good or bad your ideas are.

Economists failed to
predict soaring inflation and
interest rates, escalating
unemployment and the long
grind of recession. Right
now, major forecasters such
as the Independent Con-
ference Board of Canada and
Ottawa-based Informetrica
Lid. are pointing in opposite
directions when they discuss
the fate of the economy.

David Slater, chairman of
the Economic Council of
Canada, says flatly that the
public has every right to be

skeptical about economic
predicuons
It remains that the most

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Strictly personal

by Bob Hunter

Roll the dice

IN RECENT YEARS the dismal science of
economics has performed even more dismally than

the future of interest rates.
They have stayed high when
forecasters expected them to
come down, and they have
fallen when most experts said

they would stay high.
Businesses and consumers
alike have been left in the
dark.

Economic predictions are
rouunely out of whack, yet
governments continue to rely
heavily on econometric
models. If there is a historic
parallel, it must be with the
imperial courts of old where
astrologers were consulted on
a daily basis and the destinies
of nations hung in the
balance.

According to Silvia Ostry,
one of Canada’s best-known
economists, there has been a
quantum leap in uncertainty
since 1980, when the second
oil price shock struck. It
wasn't just the unex-
pectedness of the price hike
itself that rendered economic
forecasting unusually hazar-
dous, she says, it was the un-
predictability of the policy
responses of governments.

There 1s no historical con-
text for the economists, or
anyone else, to work with in
formulating predictions.

Otto Eckstein, chairman of
Data Resources Inc , says
“the biggest source of error

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in forecasting is the outside,
uncontrollable event.’’ He
cites the Korean and Vietnam
wars and OPEC as examples.

A leading mathematician,

Henry Pollak of Bell
Laboratories, says that
modern statistical methods

are able to deal quite well
with random fluctuations,
but ‘‘you will never be able
on the basis of the statistical
past to forecast the major
catastrophe that you had no
idea about.’’

Be that as it may, some
critics of economic fore-
casting are going further by

\

saying that the entire under-
taking is misguided and will
never be much better than the
tossing of a coin.

One of these people is
Wassily Leontief, a Nobel
Prize-winning economist,
who says ‘‘when | speak to
my colleagues in the natural
sciences and ask then why
they don’t use fancy
stausucal methodology such
as the economists use, the
answer is always, ‘If we had
to use those tools, we would
chuck the whole business and
get more facts.’’’

At. best, according to
Leontief, the average
econometric model can only
produce 50-50 accuracy. That
means our crystal balls, even
the 800-equation models, are
as murky as ever. You want
to know the future? Go ask
Madame Blavatsky. Roll
some dice. Throw the I
Ching. Check out your Tarot
cards. Or go ask an
economist.

+ |

CAP.

Crime Awareness Program

THE CRIME Awareness Program (C.A.P.) is a
joint project of the West Vancouver Police and the
North Shore News and is aimed at increasing
awareness of the number of break-ins that occur
throughout West Vancouver. If you have informa-
tion about any of the following incidents, you are
urged to contact the West Van police at 922-4141.

Police report break-ins in:

@ The 1300 block of Inglewood. A suspect pried open the
front door of a house just before 11 p.m. on Dec. 19,
discovered the residents were inside and fled.

@ The 800 block of Keith Road. Sometime between 10:30
a.m. and 4 p.m. on Dec. 19, someone pried open a basement
door and made off with items from the basement, including
bottles of liquor.

@ The 2900 block of Mathers. At 6:30 p.m. on Dec. 19 a
would-be thief was scared off when he pried open a window
and set off a burglar alarm.

@ The 1600 block of Nelson Avenue. Entrance was gained
between | and 4 p.m. on Dec. 19. Nothing was reported
stolen

@ The 6300 block of Bay Street between 8 p.m. Dec. 15 and
6 a.m. Dec. 16. A side window was smashed and someone
made off with $1,000 in cash.

@ The 900 block of King George’s Way. A number of small
items were stolen from a house between Dec. 12 and \4 aftera
thief entered through an unlocked patio door.

L

for the

North &West Vancouver

Yellow Pages
Telephone Directory

This is your last chance to check out your

Yellow Pages listing.
Now’s the time to look into multiple listings so your

business can be in many places at once It’s also

a good idea to list each firm you represent so people
won't have to go out of their way to find you

Remember names, positions and other information

can change in a year and your listings should

change nght along with them. (Charge:» apply for
changes and extra listings )

For further intonation, phone your B.C Tel Customer
Semice Office It’s later than you think.

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