Quotes About Forecasting

Hurricane Irene's advance coverage was heavy on worst-case scenarios. Thank goodness they didn't pan out.

We are all forecasters. When we think about changing jobs, getting married, buying a home, making an investment, launching a product, or retiring, we decide based on how we expect the future will unfold.

Consumers of forecasting will stop being gulled by pundits with good stories and start asking pundits how their past predictions fared—and reject answers that consist of nothing but anecdotes and credentials.

Take the price of oil, long a graveyard topic for forecasting reputations.

To illustrate, imagine

For centuries, it hobbled progress in medicine. When physicians finally accepted that their experience and perceptions were not reliable means of determining whether a treatment works, they turned to scientific testing—and medicine finally started to make rapid advances. The same revolution needs to happen in forecasting.

If forecasters can keep questioning themselves and their teammates, and welcome vigorous debate, the group can become more than the sum of its parts.

A forecaster who doesn't adjust her views in light of new information won't capture the value of that information, while a forecaster who is so impressed by the new information that he bases his forecast entirely on it will lose the value of the old information that underpinned his prior forecast. But the forecaster who carefully balances old and new captures the value in both—and puts it into her new forecast. The best way to do that is by updating often but bit by bit.

Need for cognition" is the psychological term for the tendency to engage in and enjoy hard mental slogs. [...] superforecasters score high in need-for-cognition tests.

If we are serious about measuring and improving, this won't do. Forecasts must have clearly defined terms and timelines. They must use numbers. And one more thing is essential: we must have lots of forecasts.

Assemble forecasters. Ask them large numbers of questions with precise time frames and unambiguous language. Require that forecasts be expressed using numerical probability scales. And wait for

Forget the old advice to think twice. Superforecasters often think thrice—and sometimes they are just warming up to do a deeper-dive analysis.

Forecasters who can't cope with the dissonance risk making the most serious possible forecasting error in a conflict: underestimating your opponent.

More often forecasts are made and then…nothing. Accuracy is seldom determined after the fact and is almost never done with sufficient regularity and rigor that conclusions can be drawn. The reason? Mostly it's a demand-side problem: The consumers of forecasting—governments, business, and the public—don't demand evidence of accuracy. So there is no measurement. Which means no revision. And without revision, there can be no improvement.

And only when we are proven wrong so clearly that we can no longer deny it to ourselves will we adjust our mental models of the world—producing a clearer picture of reality. Forecast

produce forecast-wrecking

The one undeniable talent that talking heads have is their skill at telling a compelling story with conviction, and that is enough. Many have become wealthy peddling forecasting of untested value to corporate executives, government officials, and ordinary people who would never think of swallowing medicine of unknown efficacy and safety but who routinely pay for forecasts that are as dubious as elixirs sold from the back of a wagon.

WE ARE ALL forecasters. When we think about changing jobs, getting married, buying a home, making an investment, launching a product, or retiring, we decide based on how we expect the future will unfold. These expectations are forecasts. Often we do our own forecasting.

superforecasting demands thinking that is open-minded, careful, curious, and—above all—self-critical. It also demands focus. The kind of thinking that produces superior judgment does not come effortlessly. Only the determined can deliver it reasonably consistently, which is why our analyses have consistently found commitment to self-improvement to be the strongest predictor of performance.

Superforecasting does require minimum levels of intelligence, numeracy, and knowledge of the world, but anyone who reads serious books about psychological research probably has those prerequisites. So

we are serious about measuring and improving, this won't do. Forecasts must have clearly defined terms and timelines. They must use numbers. And one more thing is essential: we must have lots of forecasts.

it turns out that forecasting is not a "you have it or you don't" talent. It is a skill that can be cultivated.

Speculative markets have always been vulnerable to illusion. But seeing the folly in markets provides no clear advantage in forecasting outcomes, because changes in the force of the illusion are difficult to predict.

Perhaps one day earthquakes, hurricanes and financial crashes will all be predictable. But we don't have to wait until then for seismology, meteorology and economics to become sciences; they already are.