Last Thanksgiving, we presented a chart featuring a spurious correlation between the average live weight of U.S. farm raised turkeys and the MSCI World Stock Market Index, in which we showed how U.S. turkeys predict global stock market crashes. Here's what we wrote at the time....
As you can see in our carefully calibrated chart above, whenever the value of the MSCI World index has exceeded the equivalent live weight of an average farm-raised turkey in the U.S., the index went on to either stagnate or crash. And in 2014, the value of the the MSCI World Stock Market Index has once again exceeded that key threshold, which can only mean one thing.... The climate for investors has changed, and it's time to sell!
And if they try to tell you that doesn't make any real sense, you should hold firm and tell them that the correlation is really strong (the R² is 0.9616), which means that the science is settled and that they really shouldn't want to be some kind of climate change science denier.
Speaking of which, the rising live weight of U.S. farm-raised turkeys also is strongly correlated with global warming. Believe it or not, the correlation between atmospheric carbon dioxide and global temperatures is not very strong at all (other factors do a much more coherent job in explaining actual temperature observations).
Say what you will about the science, but you cannot deny that by using tips like this, you can make the conversation around your Thanksgiving dinner table a lot more lively this year!
The correlation between the live weight of U.S. farm-raised turkeys and global stock prices is still spurious, and yet amazingly, our prediction based upon it has largely come true in the past year, as the worlds' stock markets did indeed go on to either stagnate or crash.
And with those stock prices still above the live weight of U.S. turkeys, we can't as yet say that global markets are finished stagnating or crashing as yet.
If it seems irrational to link the weight of U.S. turkeys and global stock prices, just remember the old saying: the market can remain irrational longer than you can remain solvent. Do you really feel lucky enough to bet against the birds?
Data Sources
MSCI. MSCI - World Stock Market Index. (End of Day Index Data Search). [Online Database. ]. Accessed 23 November 2015.
National Turkey Federation. Sourcebook. [PDF Document]. October 2013.
U.S. Department of Agriculture. Turkeys Raised. [PDF Document]. 30 September 2015.
Labels: satire, stock market, thanksgiving
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