(Eli) Manning's Law

The predictions of "experts" are often wrong.

The victory of the New York Giants in the National Football League's Super Bowl is the latest in a series of recent news developments that underscore a principle that might be called Manning's Law, after the Giants quarterback Eli Manning: The predictions of "experts" are often wrong.

You can look it up. Sports Illustrated, the venerable, highly profitable jewel of the Time Warner Corporation's magazine empire, employs a veteran sportswriter named Peter King. The magazine describes him as "one of America's premier pro football writers." He's written at least three books about football, and he's been covering the sport professionally for more than 30 years. He's on the board that picks members of the Pro Football Hall of Fame.

Mr. King's 2011 NFL preview predicted that the Giants wouldn't even make the playoffs.

I don't mean to pick on Mr. King or on Sports Illustrated. What about ESPN, which is the Walt Disney Corporation's entry in the sports journalism category? ESPN has not just one NFL expert but 12. Not a single one of the 12 experts in the ESPN NFL season preview picked the Giants to win the Super Bowl. Only one of the 12 even thought the Giants would make the playoffs.

Andy Benoit writes about football for The New York Times and CBS Sports. His NFLTouchdown.com site bills itself as "the best NFL analysis and commentary on the planet." His season preview didn't pick the Giants to win the Super Bowl this year, either.

Even on the eve of the game, the Las Vegas oddsmakers favored the New England Patriots to win, not the Giants.

We expect a degree of chance and unpredictability in sports, which, after all, are just games. What about really important matters, such as the nation's economy?

On Friday, Politico's "Morning Money" daily email led with its take on the job statistics that would come out that day from the federal Bureau of Labor Statistics. The first prediction cited was this: "Moody's Analytics Mark Zandi emails: "The January employment report will be on the soft side. I expect payroll employment to increase by just over 100K and private sector employment to increase by 125k. Unemployment will edge higher to 8.6%."

Mr. Zandi, who has a Ph.D. from the University of Pennsylvania, was an adviser to Senator McCain's Republican presidential campaign who is also often described as President Obama's favorite economist. His own web site describes him as "a trusted adviser to policymakers and an influential source of economic analysis for businesses, journalists and the public." But his prediction for the January employment number was as spectacularly wrong as the NFL season previews by Sports Illustrated and ESPN. When the numbers came out Friday from the Bureau of Labor Statistics, they showed that rather than edging higher to 8.6%, as Mr. Zandi had predicted, the unemployment rate dropped, to 8.3%. And the non-farm payroll number grew 243,000, more than double what Mr. Zandi had predicted.

What about the stock market?

"Stocks Are Still Expensive" was the headline over a New York Times item posted August 4, 2011 by David Leonhardt, a Yale graduate and winner of the 2011 Pulitzer Prize for Distinguished Commentary for what the Pulitzer Board called "his graceful penetration of America's complicated economic questions." Mr. Leonhardt's "Stocks Are Still Expensive" item began, "The main problem for the stock market is obviously the economy. But it's not the only problem. Stocks are also under pressure because they are fairly expensive right now relative to earnings." It went on, "stocks would have to fall another 6 percent from their current level to return to the 50-year average." The Times at one point that day was linking the item from its home page.

Later in August 2011, Mr. Leonhardt was praised by Yale President Richard Levin as "but one of many visible examples of the profound way in which the liberal arts education you are about to experience can help you to develop the capacity to see the big picture." Mr. Leonhardt has since been promoted to Washington bureau chief of the Times.

Since Mr. Leonhardt posted the "Stocks Are Still Expensive" item, the stock market, as measured by the Standard & Poor's 500 Index, rather than falling by 6% as the item predicted, has risen 12%.

I'm not here to make fun of Mr. Leonhardt, Mr. Zandi, Mr. King, or the other experts. The point is that even smart, experienced, and accomplished people can be wrong, which is why humility is so important, and elitism is so dangerous. Complex systems are hard to predict.

Sure, it's possible to take skepticism of expert authority too far. But the mistake made more commonly is listening to the experts. Eli Manning didn't pay much attention to them, and look where it got him.

Ira Stoll is editor of FutureOfCapitalism.com and NewsTransparency.com, and the author of Sam Adams: A Life.