When you get down to the smallest stuff, particles like electrons, it gets pretty hard to figure out where the darn things are. It's hard to figure out how fast they're going too.
Here's where it gets weird. The more you know about where an electron is, the less you know about it's momentum or velocity. And if you can figure out its velocity, you won't know where it is. That's Heisenberg's uncertainty principle. If you think about this, it makes no sense which is why Einstein hated quantum mechanics! I'm saying, if I know how fast something is going, I can't know where it is? Yup. But this only applies to particles, not big stuff that we can see. If I know where a car is now, and where it is in 5 minutes, I can tell you the speed. Or can I? What if it's in the same place 5 minutes later? In that amount of time, a photon could go to the moon and back several times and just happen to be where we left it 5 minutes ago! Gotta love this stuff.
This has a wonderful business application. When we can see where a market is, meaning the state of the market, such as business is good, booming, slow or dead; we know less about where that market will go.
Look at the solar industry right now. Business is good. Lots of solar being installed. That means we know less about what products will be selling a year from now. As we see business boom, the inflow of capital accelerates R&D. Can you predict the outcome or breakthroughs produced by accelerated R&D? Nope. In fact, the more you know about today's market, the less you know about tomorrow's.
Draw an upward curving slope? At what angle? And tell me, what products are on that slope? You don't know.
Now let's say you've just invented a new solar product. You know that product very well. After all, you made it. But can you predict with certainty how that product will do in the market? No.
Then why do we fool ourselves by thinking we can look in the rear-view mirror and therefore know what is ahead? That is the basis of forecasting. It's wrong, expensive thinking.
