CHESSNOID

Why are economists consistently wrong?  They make predictions based on all their academic training and still most of their forecasts miss.  72 out of 72 economists predictions were all wrong in the article below.  Are they all just financial weatherman and hoping to be right some of the times? Some of the things we see in our economy are obvious but they always seem to make analysis that are a disconnect from it.

Feb. 24 (Bloomberg) –

eb. 24 (Bloomberg) — Sales of new homes in the U.S. unexpectedly fell in January to the lowest level on record, a sign that an extension of a government tax credit may not be enough to rekindle demand.

Purchases declined 11 percent to an annual pace of 309,000, below the lowest forecast in a Bloomberg News survey of economists, from a 348,000 pace, figures from the Commerce Department showed today in Washington. The median sales price dropped 2.4 percent from January 2009 and the supply of unsold homes increased.

The report underscores Federal Reserve Chairman Ben S. Bernanke’s comments today that the economy is in a “nascent” recovery still requiring low interest rates. Homebuilders face competition from foreclosed properties that have driven down prices at the same time companies are reluctant to create jobs.

“The foreclosure flow is robbing demand from the new-homes market and that process seems to be strengthening,” said Julia Coronado, a senior economist at BNP Paribas in New York, “The new-homes market just can’t get off the floor. If new homes suffer, construction suffers and jobs suffer.”

Sales were projected to climb to a 354,000 annual pace from an originally reported 342,000 rate in December, according to the median estimate in a Bloomberg survey of 72 economists. Forecasts ranged from 325,000 to 386,000.

Stocks trimmed gains after the report, with the Standard & Poor’s 500 Index rising 0.2 percent to 1,097.27 at 10:13 a.m. in New York.