Nebraska Residents Sweep My Derby of Economic Forecasting

John Dorfman

February 22, 2021 (Maple Hill Syndicate) – Residents of Nebraska earned a clean sweep of the honors in my 19th annual Derby of Economic Forecasting Talent (DEFT).

Contestants entered from Pennsylvania, Virginia, Iowa, Kentucky and even Poland. But none of them won. It must be something in the Nebraska water. Oh yes, Warren Buffett, widely considered the greatest U.S. investor, comes from Nebraska too.

Two people tied for first place. Les Digman is a retired professor of business strategy at University of Nebraska in Lincoln. Mark Riley writes for the virtual assistant “Ted” at the brokerage house TD Ameritrade.

Third place went to Jerry Jacobi, a physical therapist in Omaha.

You can play, too. The contest’s questions and entry rules are at the end of this column.

Giant Monkey Wrench

Predicting the economy was even more difficult than usual in 2020, as Covid-19 threw a giant monkey wrench into the machinery.

Even though the pandemic was already underway when this contest began in early March, most contestants underestimated its impact.

Unemployment started 2020 very low at 3.5%, surged to 14.7% in April, and subsided to 6.7% at year-end. Most contestants didn’t see this coming, and that’s typical. When any variable veers way off from past trends, most people miss it.

Demand for gasoline and jet fuel fell dramatically. Most contestants rightly guessed that oil prices would fall, yet most of their estimates were still too high. Oil ended 2020 near $45 per barrel, down from $61 when the year began.

The average contestant forecast 1.1% economic growth, down from 2.1% in 2019. What actually happened was a lot worse. Growth was negative 2.3%.

The Winners

Riley, 67 years old, tied for first with keen guesses about the price of oil and the unemployment rate.

“I think things are going to open up, because they have to,” Riley says now. “You can’t stay shut down forever.”

He sees signs that the economy is strong in Omaha, with employers such as Alphabet and hiring people, and new buildings sprouting up. He thinks the national economy will show a pretty good recovery in 2021 as well.

Digman tied for first by making good estimates on interest rates, oil prices and inflation. He likes to build forecasting models, even for athletic events, and insists that his models be multi-factorial. “People always look for the main factor,” he says, “but that might be only 15% to 20% of the result.”

In 2021, Digman looks for good growth off a low base.
“People are yearning for life as we used to know it,” he says.

Jacobi earned third place with his estimates on retail sales and oil prices. He thinks that “pent-up demand” will lead to a vigorous economic rebound this year, though “it will be June or July before it really takes off.” Inflation will follow, he figures, but won’t be serious until 2022 or 2023.

How to Enter

If you’d like to enter the Derby, answer the six questions below, and provide some information about yourself – name, address, phone, and email. I need all this in case you win and I want to interview you.

You aren’t required to state the reasons behind your forecasts, but I like it if you do.

Send entries to me at, or John Dorfman, Dorfman Value Investments, 101 Federal Street, Suite 1900, Boston MA 02110. Entries must be postmarked or time-stamped by midnight, March 10, 2021.

Now for the questions.

  1. The U.S. economy shrank 2.3% in 2020. How much will the gross domestic product grow or shrink in 2021?
  2. Inflation was pretty tame last year, at 1.56%. As measured by the Consumer Price Index, what will inflation be this year?
  3. The interest rate on 10-year U.S. government notes shriveled to a mere 0.93% as of December 31, 2020. What will it be when 2021 ends?
  4. You could buy a barrel of crude oil (West Texas Intermediate, or WTI) for $48.35 as the year 2020 ended. What will the oil price be when 2021 draws to a close?
  5. U.S. retail sales grew a little bit in 2020 despite the pandemic. They were $539.67 billion in December. What will they be in December 2021?
  6. Unemployment soared in 2020, and was still very high at 6.7% when the year ended. What will it be at the end of this year?

Entries are free, and I don’t make fun of the people who lose – at least, not by name. The winner will get a plaque. So give it a try, and good luck!

John Dorfman is chairman of Dorfman Value Investments LLC in Boston, and a syndicated columnist. His firm or clients may own or trade securities discussed in this column. He can be reached at

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