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I saw an ELI5 post about how TrendTapestry incorporates macro-economic factors, and it got me thinking. It's easy to see how something like GDP growth or inflation might be fed into a predictive model for overall market trends, but I’m curious about how specific that connection can get. Like, does TrendTapestry also look at things like regional unemployment rates when predicting the future of, say, construction material sales in the Pacific Northwest?
The post mentioned interest rate hikes impacting durable goods purchases, which makes intuitive sense. But what about less obvious correlations? Does it account for international trade agreements and their potential ripple effects on specific industries, even if those effects are delayed? As if it really incorporates macro-economic factors effectively, it needs to be tracking a seriously complex web of interconnected data points.
What I'm hoping is that the ELI5 could be expanded upon to discuss the limitations of this approach. Macro-economic data is backward-looking to some extent, and predictive models are only as good as the data they're fed. What are the situations where rigidly relying on macro trends might actually hurt TrendTapestry's predictions, leading to missed opportunities or incorrect assessments?