Monday, September 22, 2014

Jason versus the Fed Presidents

I came across this [pdf] during the course of a Google search; it shows the predictions of the Federal Reserve Board (FRB) members and the bank presidents. Maybe the predictions are based on models, but for some reason I believe the majority are just some gut opinions from some dudebros (e.g. this guy or this guy). Let's see how the information transfer model stands up:

This is based on the predictions here, except I used a starting date of 2013 instead of 2014. The Fed guesses predictions are given as annual averages and so are shown as a coarse-graining. Note that the gray bands (70% and 90% confidence) are primarily due to irreducible measurement error in the monthly measurements -- the error in the annual averages will be much smaller. Here's a better apples-to-apples comparison in terms of annual averages:

I am at a distinct disadvantage in that unlike the bank presidents I don't have a vote on the Federal Reserve Board and can't influence monetary policy to e.g. make my prediction come true.

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