David Farrar links to an article from 1 year ago – where economists were rather positive about the outlook for New Zealand. I was the same – I thought we would be out of a drought induced recession by September 2008.
But things happened that we couldn’t foresee. Lehman brother’s collapse was the issue that really turned things around.
However, even if this hadn’t happened the idea of the recession ending in September would have been wrong – as the impact of falling house prices on consumer spending was stronger than I had expected.
As MyNameIsJack said in the comments on Kiwiblog:
Economists very rarely make accurate predictions, in fact I would lay money on more meteorologists being right next week than economists. Economists are good at explaining why after the event, lousy at explaining what and when in advance.
Economists don’t have perfect foresight, but when we have the data we are pretty good at describing what has happened – sometimes 😛