Sublime

In numerous experiments, people react very differently to the information that “ninety of one hundred are alive” than to “ten of one hundred are dead”—even though the content of the two statements is exactly the same.

It resembles a “normal” distribution, with short “tails” and a fat middle. From this we can see that in any given one-year period, the U.S. stock market usually returns somewhere between +40% and -20%, which is a wide range. The most common result is between flat and +20%. But then contrast that to the rolling ten-year results: There are no “tails”

Tetlock has studied 300 academics, economists, policymakers and journalists and compared more than 82,000 of their forecasts to what actually happened in the real world. Here are his conclusions:

Les données ont été absolument cruciales. Comme elles le seront à l’avenir également, quand éclatera la prochaine épidémie. C’est pourquoi il est essentiel de protéger leur crédibilité, et la crédibilité de ceux qui les produisent. Les données doivent être utilisées pour dire la vérité, pas pour inciter à agir, aussi nobles soient les intentions.

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The economists wrote: “Our findings suggest that individual investors’ willingness to bear risk depends on personal history.” Not intelligence, or education, or sophistication. Just the dumb luck of when and where you were born.

For the second time, the Ten-Count System had shown moderately heavy losses mixed with “lucky” streaks of the most dazzling brilliance. I learned later that this was a characteristic of a random series of favorable bets. And I would see it again and again in real life in both the gambling and the investment worlds.