Economics Forecasting:You Haven't Come Very Far at All, Baby

Greg Mankiw, writing in today's NYTimes about parallels between the Great Depression and the current economic situation, said,

... the leading economists at the time, at competing forecasting services run by Harvard and Yale, were caught completely by surprise by the severity and length of the Great Depression. What’s worse, despite many advances in the tools of economic analysis, modern economists armed with the data from the time would not have forecast much better. In other words, even if another Depression were around the corner, you shouldn’t expect much advance warning from the economics profession.

This statement belongs at the beginning of every macroeconomics and econometrics course! Believe me, I'll be using it a lot!