Eggert retired from RCA in 1976 and started Blue Chip Consensus. In his newsletter, he put to work everything he'd learned about the accuracy of averaging. His slogan, in fact, is, "Aiming for accuracy."
Soon, the newsletter's name became synonymous with the best economic predictions in the country. Eggert's frequent appearances on Louis Rukeyser's Wall Street Week and frequent quotes in all the major business publications reinforce this image. Forbes magazine called his newsletter the "industry benchmark."
Since Blue Chip's inception, the consensus has predicted the gross national product remarkably well, to within a 0.9 percent difference. In thirteen years, the consensus has hit the GNP figures on the nose twice, been too high four times and too low on seven occasions. The consensus hit the bull's eye for 1989 with a sluggish 2.5 percent GNP-growth guesstimate.
They've been just as good on inflation; their thirteen-year average on inflation is one percentage-point difference.
Eggert's predictions are now more important than ever, with gas prices soaring, the stock market falling and troops heading out to the Middle East. And indeed, he says that things are not good.
This year, Eggert's publication predicts an anemic 1.8 percent growth rate and a 4.2 percent hike in inflation. The latest poll places the economy on the brink of a recession. In fact, the newsletter has--literally--the caution flag out. The top cover of the newsletter has been yellow. Like flags at Indianapolis, the green, yellow or red colors signal how things are going.
"The Phoenix area will be hit with a sledgehammer. We'll get hit. We'll be hurt," he says. But the news is not all bad. "It won't get worse than the 1974 or 1982 recessions. Historically, Arizona is always hit harder and rises faster."
EGGERT LEANS BACK to stare out the window, the economic guru unnoticed in a town devoted to the New Age, where conversations in coffee shops turn to crystals and pyramid power.
Sedona's sandstone monuments stand in vivid contrast to Eggert's former view of the Manhattan skyline. The fewer than 8,000 inhabitants in Sedona claim no town water or sewer service. The New York Times shows up in the mail if at all.
"New York is a nice place to visit, but . . . " Eggert's voice trails off remembering his years in the concrete jungle. "I had a reporter out here from Forbes magazine recently. You just knew he was jealous. Although when I first came out here, the biggest question I had was, `Where the heck is Sedona?'"
The New York Times calls him the "best known tabulator of prevailing business sentiment" in the country. "The Phoenix area will be hit with a sledgehammer. We'll get hit. We'll be hurt," the economist says.
Eggert was working in the Ford marketing division when the economist got the nod to research the marketing plan for the Edsel.
Iacocca writes the Mustang was named after the World War II fighter plane. Eggert says Iacocca's memory is a little short.
"Accuracy is like a hand grenade. You don't have to be exact. As long as you're reasonably close, it's effective." Thanks to his electronic ears, Eggert has a $700-a-month phone bill--the highest, AT&T says, in the whole town.