Pi Attitude Zone: Self-Fulfilment

Today’s Forecast: The Forecast Will Be Wrong

How good are forecasters at forecasting?  Sorry, folks, but... not very.

As revealed in a study by a Berkeley University psychologist, experts on social and political issues were asked over a 20-year period to make forecasts based on three possible results, all measurable after the event. The pundits were scored on probability-assessment, and on their accurate prediction of outcomes.  Alas, collectively they performed  less well than if they had randomly assigned equal probability to each of the three possible results. As one commentator put it, “Human beings who spend their lives studying the state of the world are poorer forecasters than dart-throwing monkeys”.

Why? First, it seems experts too often fall prey to personal hunches, tending to dismiss new information that doesn’t fit their pet theory. Who’s to contradict them, anyway? They’re the experts!

Indeed, most of us shrug off new data that contradicts what we think.  We’d rather find more reasons for believing what we believe than look for reasons why we might be wrong. But then Most Of Us don’t pretend to be right all the time. Unlike the self-styled experts.

Too often, gurus and pundits like to show off their complex reasoning, and gratuitously tangle things up for no special reason.  In the real world the odds tend to be with the blindingly obvious. If it walks like a duck and quacks like a duck, could it possibly be… um... a duck?  Not when the experts get hold of it. They will find ways of convincing themselves that “The Duck-Like Object” is something vastly more intricate, mysterious and significant.

This is partly because of the irresistible human impulse to impress people by making things sound more complicated than they really are. The more prominent the forecasters, the more they seem to spout the most overcooked forecasts. Pundits apparently feel that the more intricate the prediction, the greater the kudos associated with making it. Accordingly they profess to have discovered “a set of multiple interlocking phenomena that no-one else has spotted”. This is usually rather foolish, since by definition the likelihood of three separate things all coming to pass at the same time is statistically a lot lower than the probability of any single one of them coming true.

What can they say when their confidently-predicted outcomes prove to be wildly mistaken? If there is one thing experts hate more than being wrong, it’s being proved to be wrong. But they don’t have to worry unduly. Much prediction is of the long-shot variety; by the time the answer is known, almost everyone has already forgotten the question.

Pi says:  dear blog-reader, you should look at the evidence and make up your own mind. You’re just as likely to get it right as the experts are, it seems.

Zone: Self-Fulfilment Country: Multiple Geographies Product – Other