Our Accuracy
Most forecasters (no matter who they are or what they are forecasting) essentially use a straight line extrapolation from what has been experienced recently. These forecasts are almost always wrong, because everyone is hard at work in a world of current conditions in ways that guarantee that those conditions will change. We believe that world markets move in discontinuities, and we therefore try to forecast specific discontinuities in terms of when they occur and the different rates of change at different points of time in the future. Using this approach, we have been able to accurately identify all of the major discontinuities in oil price that occurred during the last three to four decades.
Groppe, Long & Littell is probably the only group that seriously attempts this kind of forecasting, and has been doing so for more than 50 years. It is critically important to forecast year by year—not just long term. Our forecasts will show up or down occurrences over an 8- to 12-year period, whereas others will show a trend line—which is not a real world forecast. We are able to do this because of our very detailed, bottom-up approach, rather than the top-down methods of other forecasters. The more discrete, micro-economic studies that are made, the more accurate the total forecast is likely to be. This is what we do and it is key to having worthwhile forecasts.
