The Only 2023 Prediction That (Really) Counts

Smart people know that they cannot really predict the future.

Many try anyway.

As the new year rolls around again, many thought leaders, financial analysts and gurus of all shapes and sizes are publishing their analysis of 2022 and their forecast for 2023.

Every bank, every consultancy and almost every self-styled social media influencer has a take on what the new year will bring. Many predict a global recession. Some see a dramatic paradigm shift in markets and society on the horizon.

But in the end, no one is able to foretell what the future will bring with complete accuracy.

No doubt many 2023 outlook publications contain detailed data to justify their predictions. It would be unwise to ignore such research entirely. Hidden among a forest of projections and estimations there are sure to be some insightful investment ideas and a few words of real wisdom.

But predictions are nothing compared to the power of preparation.

And preparation does not come from reading hundreds of year-end reports. It comes instead from having a clear focus on a desired outcome. If you know what you want and what your plan is, then you will rarely be fooled by randomness. It is that simple.

The vast majority of year-end predictions look and feel the same. The breadth of information available today makes it nearly impossible to obtain a set of unique data that is different from what everyone else has. Inflation numbers are widely available. Public companies publish their results for everyone to read. By and large, the data does not lie.

Where opinions do differ, they are seldom unbiased. Even the most revered insitutions - think Goldman Sachs, BlackRock, the US Government - have inherent tendencies that influence their outlook. Individual analysts may claim to make their predictions based solely on the basis of the information in front of them, but this is often not true. Every single person is swayed, even subconsciously, by their own experiences, background, societal surroundings and more.

This may include very personal prejudices - or, more often, recent historical events that overshadow rational thinking at the moment.

So are there any predictions worth considering at all?

Probably only one.

Where there are many counsellors saying the same thing, it pays to be a contrarian.

This is, after all, the famous formula for success in Silicon Valley.

To quote Peter Thiel: “The very best thing is to be contrarian and right.”

And in the case of New Year predictions - whether in financial markets, local politics or international sport - being wrong usually equates to being right. What most people miss is what actually happens and what the majority bet on rarely comes to pass (exactly as predicted).

So the most important 2023 prediction is simply this: things will be different than most people think.

Going against the grain is the best way to end up ahead of the crowd.

Or put differently - “The best way to predict the future is to create it.”