I Will Teach You To Be Rich: No guilt, no excuses - just a 6-week programme that works

by Ramit Sethi

Before we move on to discuss how you can beat the experts, let’s look a little more deeply into how they operate and why their advice so often misses the mark. The most visible financial “experts” are the pundits and portfolio managers (the people who choose the specific stocks in mutual funds). They love to regale us with their predictions about where the market is going. Up! Down! They go on and on about how interest rates and oil production and a butterfly flapping its wings in China will affect the stock market. This forecasting is called “timing the market”. But the truth is they simply cannot predict how high, how low, or even in which direction the market will go. I get emails from people wondering what I think about the energy sector, currency markets, or Google every single day. Who knows about those things? I certainly don’t, especially in the short term. Unfortunately, the fact is that nobody can predict where the market is going. Still, the talking heads on TV make grandiose predictions every day and, whether they’re right or wrong, they’re never held accountable for them.