For centuries, humans have tried to predict what was going to happen next. They sought out oracles and mystics, fortune tellers and psychics, and forecasters and models.
People crave certainty. We want to know what we’re going to get — what happens next. We don’t like surprises.
Yet, the market is inherently uncertain. It’s unpredictable. Nothing is guaranteed. It’s full of surprises.
The constant lesson of history is the dominant role played by surprise. Just when we are most comfortable with an environment and come to believe we finally understand it, the ground shifts under our feet. Surprise is the rule, not the exception. That’s a fancy way of say we don’t know what the future holds. Even the most serious efforts to make predictions can end up so far from the mark as to be more dangerous than useless. — Peter Bernstein
In fact, the market is so unpredictable that we only know what will happen long after the fact. Continue Reading…