Categories
All Articles Clinical Career Entrepreneurship Money & Finance Non-Clinical Careers

About Those Predictions…

So, real estate was supposed to crash, driving down housing costs to make them much more affordable. AI was supposed to read X-rays for us freeing up more time for physicians to focus on other things. And stocks would come down by a lot, making it the perfect time to buy with all that cash you’ve had sitting on the sidelines.

Let’s not even talk about predicting that you’ll be happy with a career in medicine vs some other profession.

Predictions can rarely be made accurately. If they do eventually happen, you won’t know the timing. That is why it’s often more anxiety-inducing than helpful or useful. And certainly wrong 99% of the time (unless the article is taken down after the fact.)

Predicting the Future

I don’t watch the news – I stopped doing that around 2012. I was warned that this could be a bad decision since I wouldn’t have anything to talk to people about and would be less informed.

Without the “news,” I get my information from different sources where I can not only track someone’s predictions but also look back and see how accurate they were.

In 2016 I made it a habit to write into my calendar when someone noteworthy made any prediction, stamping the due date and their name. Not a single accurate prediction so far from anyone.

Real Estate Predictions

Let’s say you knew for certain that by August 2024, real estate prices in your neighborhood would crash by at least 25%, maybe even 40%. You are renting, and you live in a good neighborhood; great, you will buy!

The Cash

So now that you knew this, you had to move your cash out of your investments or set your paychecks aside into a cash or savings account.

That means your money was going to depreciate for a year. Not a big deal to you because you are about to profit a potential 25-40% on that home purchase.

The Competition

August 2024 comes around, and you and your realtor, the only one you could find, are scouring listings daily. The problem is that most homes are disappearing before they come on the market.

Even worse, many are not even being listed; deals are made before an MLS is offered.

People who are professional real estate investors are also coming in with cash from their own pockets or from har money lending and scooping your favorite home up before you had a chance to walk through it.

The Seller

So about the supply side … if you were the seller and market rates suddenly told you that your lovely home is now worth $300k less overnight, would you sell?

You’d probably rent it out or stay there.

That means the supply side drops quite a lot. Even though prices are down, nobody is selling.

Buying Frenzy

But because it’s now a buy’s market, everyone and their momma is ready to buy a house. So you are competing and outbidding each other for that house, driving the price up artificially past the actual value.

Banking

Banks are seeing a lot more response and so a lot more debt is being issued. This means the real estate market is driving debt loads which the Fed recognizes and so they will push back by tightening banking and raising interest rates.

Interest Rates

So now that $1m home on sale for $750k will require you to purchase some points and pay even more for the monthly payments for the next 30 years.

Contractors

Screw it, it’s worth it, you locked in the 6% interest rate, you fought all the other competitors and got in on the last house, which needs a total remodel of the stairs and backyard.

Well, no contractors to be found because you’re not the only one who bought a home that needs to be fixed up.

The only contractors available are saying that they won’t take on any jobs less than $250k. So now you’ll have them install that pool too, while they’re at it.

Handling Predictions

If predictions were that easy to make we wouldn’t have any profits in the markets. Last time I checked my index fund portfolio has been generating a healthy unrealized gain.

Profits are well and alive.

All I can focus on is what I like to do at the moment, what my lifestyle means to me, and have a good personal financial plan.

Living the Life I Enjoy

If I want to buy a home and the math makes sense, the profits or predictions should matter little. But if you’re a real estate investor, that’s a whole different discussion, and you certainly wouldn’t be coming here for that.

Regarding AI in healthcare or stock market predictions, it’s the same thing – predictions are of little value and not even entertaining because they often add anxiety.

Are we seeing a ton more lives saved from statin drugs? No, not even after most have become generic. People have chosen not to take them or those who are taking it have picked up other bad habits.

Market forces and mother nature have this balance they will reach – a very predictable equilibrium.

I can only do what I think is right for me in the moment. Some foresight is necessary. But that isn’t rocket science and you don’t need an AI prediction tool for most of the safe decisions.

Starting a Business?

How do you know that your business idea will fail? Why not give it a chance and see where it goes?

We predict with certainty that this business idea we have won’t succeed because of this or that reason.

Getting out of Medicine?

We think our careers in medicine are safe and learning something totally new or trying something different will fail.

You don’t know that, you are predicting it based on popular beliefs and the shit you’ve been fed by your parents and fellow clinicians.

Cashing out Your 401k?

I cashed out my 401k twice and I’m still alive. I could have been “wealthier,” but I measure my wealth not by the dollars in the bank but the quality of life I’ve living.

Moving to Another Country?

Want to live abroad for a while? But you are predicting it will be a bad choice? Or that the country will be unsafe? Or that you will fail there?

You don’t know that but you are basing your prediction on popular beliefs that you have it pretty good and that you shouldn’t rock the boat.

Think the Grass is Greener?

Equally false is the prediction that medicine sucks and therefore any other profession must be better than this.

If your current medical practice sucks then finding joy in it is of more value than changing it, maybe. But predicting the downfall of healthcare and mass burnout and mass exodus of all doctors and nurses – please!

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.