In
practically every aspect of our lives these days, we rely on data. Either it’s data we seem to use up too
frequently on our phone plans during the month or it’s data concerning
something that’s coming up in our lives on which we need to make a decision –
and in both cases, if we use the data incorrectly, it could certainly cost us
(or so we think).
When
Nordstrom decided to stop releasing monthly sales numbers by store, Credit
Suisse –
a company that provides, among other things, data to the financial industry –
claimed they could reliably predict Nordstrom’s monthly numbers by using
monthly sales figures from (I’m not making this up) The Cheesecake
Factory. Credit Suisse believes the
customer demographics of both companies are fairly similar so their spending
behaviors will also be similar (i.e. if sales go up at CF, they go up at
Nordstrom). Credit Suisse claims they’ve
gone back and compared available data from the past, and their claim bears
fruit (not to be confused with the strawberries, blueberries, or cherries you
find most frequently atop a cheesecake).
FEMA
claims they can predict where a hurricane has wreaked the most havoc by seeing
where Waffle House restaurants remained open and which ones closed. In 2011’s Hurricane Irene, they witnessed WH
outlets closing in a number of states on the eastern seaboard, and only one in
Virginia closing, so they deployed more supplies/people to those areas where WH
was closed and fewer in Virginia. They
employed this theory most recently with Hurricane Matthew and relied on WH’s
Twitter account to give them updates.
(I’m not that sure about how secure a Twitter account is, but it seems
HIGHLY possible a 15-year-old could hack it and cause FEMA to dispatch a fleet
of semis to a bar mitzvah in Toledo, Ohio, if they’re not careful.)
In
a recent newspaper article, the author said he could predict the future of the
housing market (it wasn’t rosy) by looking at IKEA’s recently released 2017
catalog. He noted that rather than
having walls in a house, IKEA is telling you that you’ll separate rooms using
clothes racks instead. Along those same
lines, rather than sleeping in a bed in an actual bedroom, you’ll live in a
“multi-functional” space with a sofa bed as your day-to-day sleeping
arrangement. To wit, he was predicting
that housing prices will continue to soar to heights where people will be able
to afford only the square footage of the box in which the IKEA products were
delivered. (The ONLY upside to all of
that would be that EVERYTHING could be assembled and fixed with just that one
Allen wrench that comes with every IKEA product ever made.)
Admittedly,
I’m poking a bit of fun at Credit Suisse, FEMA, and IKEA, but I’m not saying
they’re necessarily wrong . . . OR right for that matter. I’m just giving you three examples of the
lengths many people will go to in order to gather data and “predict” the
future. Many people have spent the last
six to twelve months in a sort of analysis paralysis about the real estate and
mortgage markets because of this side-show election we have going on here in
the US. They’re poring over web sites
and cable news programs all in the interest of trying to decide if they should
buy their first home, sell their home and downsize, or purchase an investment
property –
and yet they still haven’t done anything on that front. Why?
Well, the answer is quite simple: they want someone else to make their
decision for them so they can blame them if it’s the wrong decision. I’m going to tell you something that flies in
the face of all that: TRUST YOUR GUT and move forward. Sure, you might make a decision that will
leave you holding a few extra proverbial IKEA screws that you know should have
been used but can’t figure out where they go.
You might find yourself needing to eat at a Waffle House instead of a
Cheesecake Factory for a while. Using
the hurricane as an analogy: as unpredictable as its path may be, it’s a lot
harder for it to hit a moving target –
so move!
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