In a wonderful, short book “The Economics of Innocent Fraud”, the author, late John Kenneth Galbraith, writes on innocent fraud by those who forecast.

“Now a well-recognized area of innocent fraud. And here some that is legally less than innocent. This is the world of finance - of banking, corporate finance, the securities markets, the mutual funds, organized financial guidance and advice.

The fraud begins with a controlling fact, inescapably evident but all but universally ignored. It is that the future economic performance of the economy, the passage from good times to recession or depression and back, cannot be foretold. There are more than ample predictions but no firm knowledge. All contend with a diverse combination of uncertain government action, unknown corporate and individual behavior and, in the larger world, with peace or war. Also with unforeseeable technological and other innovation and consumer and investment response. There is the variable effect of exports, imports, capital movements and corporate, public and government reaction thereto. Thus the all-too-evident fact: The combined result of the unknown cannot be known. This is true for the economy as a whole, as also for the specific industry or firm. So the view of the economic future has always been. So it will always be.

In the economic and especially the financial world, nonetheless, prediction of the unknown and unknowable is a cherished and often well-rewarded occupation. It can be the basis, though often briefly, of a remunerative career. From it comes allegedly informed judgment as to the general economic prospect and that of the individual participating and affected enterprise. The men and women so engaged believe and are believed by others to have knowledge of the unknown; research is thought to create such knowledge. Because what is predicted is what others wish to hear and what they wish to profit or have some return from, hope or need covers reality. Thus in the financial markets we celebrate, even welcome essential error.

Shared error has also a well-protected role. It is no longer a personal matter. The financial world sustains a large, active, well-rewarded community based on compelled but seemingly sophisticated Ignorance.

To repeat, those employed or self-employed who tell of the future financial performance of an industry or firm, given the unpredictable but controlling influence of the larger economy, do not know and normally do not know that they do not know. Predictions from a financial firm, Wall Street economist or financial adviser as to the economic prospect for a corporation - recession, scheduled recovery or a continuing economic boom - are thought to reflect economic and financial expertise. And there is no easy denial of an expert's foresight. Past accidental success and an ample display of charts, equations and self-confidence affirm depth of perception. Thus the fraud. Correction awaits.”