I took Latin in high school to satisfy my foreign language requirement, choosing it because I was interested in mythology taught in the class. I found the stories fascinating. One thing we learned about was haruspicy (huh-ruhs-puh-see).
Haruspicy (huh-ruhs-puh-see) is the inspection of the internal organs of a sacrificed animal, often a sheep, in an effort to know the future (the picture above is of a haruspexer’s diagram of a sheep’s liver). It was a common practice throughout the ancient world. The inspection was performed by an expert, called a haruspex (huh-ruhs-peks). Before going to war or making major political decisions, leaders would determine the best course of action by hiring a haruspex to inspect the liver of a sacrificed animal. It was from this practice the term “sacrificial lamb” came to be.
The haruspex was afforded deference as an expert. If a recommended action did not turn out well, the haruspex could always find some reason his employer offended the gods and caused the prophecy to be wrong. As a result, the haruspex suffered no consequence for an incorrect prophecy. The king, however, might have lost his life. We laugh at haruspicy now and wonder how humans could be so silly.
Right now, many investors are more aware of how uncertain the future is. They are concerned about the economy and whether or not we are in a recession or heading towards one. This uncertainty about the future has brought out the modern day haruspexes, those willing to pontificate on the economy and the ultimate impact on stock prices. Predictions are clogging the airwaves and saturating the press. Like the ancients, we want to know the future and listen on to anyone claiming to be able to divine it. Sheep much prefer our current manner of trying to determine the future!
But how is it so different from our listening to pundit predicts about the stock market or economy? If economists had insights into where the stock market is going to go, wouldn’t they be wealthy? Who is the richest economist you can think of? I can’t think of one either. And yet they continue to get airtime.
What consequence do they suffer if they are wrong? But if you listen to their incorrect prophecy, your financial security could be hurt.
Jay and I don’t listen to or make economy forecasts, as forecasting might negatively impact our decision making. We prefer profits to pundits. Investors will profit as people continue to do Google searches, shop on Amazon, and ship by rail (Berkshire Hathaway own the largest railroad in the U.S.). By focusing on your portfolio businesses, you can make clearer decisions.
If you or someone you care about is feeling concerned, call us at 772-320-9658. We can help make sure you are not the modern-day haruspex’ sacrificial lambs!
Thank you and have a great day.
“Pundits forecast not because they know, but because they are asked.”
– John Kenneth Galbraith