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There is a great episode of Freakonomics Radio on predictions: http://freakonomics.com/2011/09/14/new-freakonomics-radio-podcast-the-folly-of-prediction/ http:/

by brodo 13y ago

There is a great episode of Freakonomics Radio on predictions: http://freakonomics.com/2011/09/14/new-freakonomics-radio-podcast-the-folly-of-prediction/ http://freakonomics.com/2011/09/14/new-freakonomics-radio-po... TLDR: * Everyone remembers predictions which predict radical change and where right. * No one remembers predictions which predict minor changes. * No one remembers predictions which where wrong. * There are so many wrong predictions, because there are no repercussions. * Most experts predictions are not better than layman's guesses, some aren't better than random chance.

dthunt 13y ago
This. The same set of cognitive defects that are responsible for statements like this are responsible for belief in homeopathy and in the power of prayer to cure cancer (despite taking chemotherapy drugs). People are remarkably bad at understanding the differential power of evidence with respect to their beliefs. That includes experts. Being right about what the evidence is doesn't mean we account for it correctly. This quote, from the MS guy, is prompting me to work out the math on Bayesian updating in an incompletely hypothesized space, tonight, because I for one would like to know how/when I can rationally update my absolute and relative beliefs about hypotheses in response to weak evidence, and if this implies anything about how I should select for less mysterious hypotheses. This seems like a really basic idea, but as a 31 year old, I am only now wrestling with the process of making less stupid decisions. I suspect the same is true for many of you. And for that reason alone, I can't really hate on the Morgan Stanley guy, because in my heart of hearts, I think he's probably not the sharpest tool in the shed, and it should not surprise me that he develops confidence in other places that probably aren't warranted. I can, however, hate on the world that allows people like this to be in a position to impact the world economy, just like I can be angry that there isn't a mandatory 'using evidence in making policy' training program for members of congress.

by brodo 13y ago

dthunt 13y ago

This. The same set of cognitive defects that are responsible for statements like this are responsible for belief in homeopathy and in the power of prayer to cure cancer (despite taking chemotherapy drugs). People are remarkably bad at understanding the differential power of evidence with respect to their beliefs. That includes experts. Being right about what the evidence is doesn't mean we account for it correctly. This quote, from the MS guy, is prompting me to work out the math on Bayesian updating in an incompletely hypothesized space, tonight, because I for one would like to know how/when I can rationally update my absolute and relative beliefs about hypotheses in response to weak evidence, and if this implies anything about how I should select for less mysterious hypotheses. This seems like a really basic idea, but as a 31 year old, I am only now wrestling with the process of making less stupid decisions. I suspect the same is true for many of you. And for that reason alone, I can't really hate on the Morgan Stanley guy, because in my heart of hearts, I think he's probably not the sharpest tool in the shed, and it should not surprise me that he develops confidence in other places that probably aren't warranted. I can, however, hate on the world that allows people like this to be in a position to impact the world economy, just like I can be angry that there isn't a mandatory 'using evidence in making policy' training program for members of congress.