Mountain Bikn' Guy wrote:

> >
> > Note that the "predictive ability" *is* affected in the sense that
> > a prediction interval for the next observation will not have the
> > correct coverage probability, because you have ignored the explanatory
> > effect of the immediately previous observations.
>
> My working assumption is that the explanatory effect of any (originally)
> previous observation is irrelevant. The model does not need to take into
> account the value of previous observations. Given this situation, I would
> think that using time series techniques and methods would be inappropriate
> (even though I do collect the data sequentially over time).

Not inappropriate. Perhaps "overkill", perhaps not statistically significant,
but certainly appropriate.

> > Note that your future observations still arrive /in order/, not
> > shuffled. It doesn't help you to pretend otherwise.
>
> The fact that future values may arrive in order is, again, irrelevant. I
> will use the model to predict a future value out of order (ie, in the same
> way oen would use any linear regression equation) so again, I do not think I
> should/could use time series methods.

The reason for using time series models is simple: To make autocorrelation
work _for_ you, by improving the forecasts. Just ask yourself this question:
In predicting the next value, will you be able to make a better forecast
(with a tighter forecast interval) knowing the current value? If yes, time
series
analysis should be used. If not, or if you don't care about forecast intervals,
use any method you like.

> The dilemma is that time series methods seem inappropriate, but there are
> also violations of most of the assumptions for using std regression methods
> as well unless I take actions to offset these (for example, resorting the
> data). Maybe I need to go completely to non parametric methods... ?

Why do I get the impression that you are grasping at straws?
What assumptions are you talking about, how are they violated,
and why does re-sorting the data fix whatever problems you got?



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