Stanford professor Scott Sagan once said something everyone who follows the economy or investment markets should hang on their wall: “Things that have never happened before happen all the time.”
History is mostly the study of surprising events. But it is often used by investors and economists as an unassailable guide to the future.
A trap many investors fall into is what I call “historians as prophets” fallacy: An overreliance on past data as a signal to future conditions in a field where innovation and change are the lifeblood of progress.
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Understanding Money
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History is an unassailable guide to the future. A trap many investors fall the “historians as prophets” fallacy: an over-reliance on past data as a signal to future conditions in a field where innovation and change are the lifeblood of progress. Past performance is not indicative...
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