The 10 Worst Financial Predictions of the Last 25 Years

Throughout history, there have been stories of great mythical oracles who could predict events. The Greeks had Pythia -- a high-priestess in the Temple of Apollo -- whose foresight was said to be infallible. In the Nordic countries, Odin was known to carry the severed head of Mimir, who gave him secret knowledge and counsel. Even in today's modern world, many still follow the advice of an "Oracle from Omaha."

But the fact is that nobody can predict with any amount of certainty what will happen in the future, especially when it comes to financial matters. That doesn't mean that many haven't tried -- more and more of them as the financial media has grown -- but more often than not, those who do end up with egg on their face.

Here then, in no particular order, are the 10 worst financial predictions of the last 25 years.

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The 10 Worst Financial Predictions of the Last 25 Years

Bob Prechter is a Yale graduate and former Merrill Lynch analyst who successfully predicted the bull market of the early '80s and has been dead wrong ever since.

His most famous prediction came in a New York Times interview in 2010 where he warned of a stock market crash "worse than the declines of 2008 and early 2009 or the worst years of the Great Depression or the Panic of 1873."

At the time the Dow Jones industrial average (^DJI) was at 9,686.48, and he warned that it would be likely to fall below 1,000 over the next five years. Well, he still has one more year to fall from 17,000 and be proven correct.

It's hard to look around today and imagine a world without smartphones and tablets. But in 1992, on the heels of the first industry event designed to promote mobile devices, one giant in the tech industry predicted that they would never become a reality.

The idea of a personal communicator in every pocket is a "pipe dream driven by greed," declared Andy Grove, then CEO of Intel (INTC). Though he was considered a pioneer in the semiconductor industry, his lack of faith in mobile ultimately caused Intel to miss out on what a contemporary -- John Sculley, the CEO of Apple (AAPL) -- called the "the mother of all markets."

In the frenzied years of the late '90s, the stock market and particularly the Nasdaq were on fire. It was not unusual for a stock to move 25, 50 or even 100 points in a day. Secretaries were quitting their jobs to day-trade for a living, and it looked like the market would never come down.

It was this market environment that produced the infamous 1999 book, "Dow 36,000" written by James Glassman and Kevin Hassett. Though it predicted that the Dow would reach 36,000 within a few years, less than six months later the market topped -- and the dot-com crash began.

Barbara Corcoran is known today as one of the savvy deal makers on the hit show "Shark Tank." But in 2005, known for her success in the high-end New York City real estate market, she was asked pointblank in a Businessweek interview if there was a bubble in the market. "Of course there is no bubble. I think we are just getting started," answered the unabashed housing bull. "Bidding and overbidding are the norm of the day. So it's going to take a lot to slow this market down. Even if it does -- which I don't see the signs of -- it will still slow down slowly. That's not what bubbles do."

Apparently her shark senses were not yet fully developed, because the housing market topped only a few months later -- and $16.4 trillion in household net worth was lost over the following four years.

It's bad enough to make one of the worst financial predictions of all-time, but when you do it twice, you must be something special -- and Dick Bove fits that bill. Not content to rest on his laurels for completely blowing the Lehman Brothers call, three years later he went for broke with a prediction about MF Global.

Just five days before MF Global declared bankruptcy, Bove took to the air to suggest that all was fine at the company and that a buyer would be announced any day. Things were not fine. No buyer materialized. The result: more than $1.6 billion in customer losses.
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