9 of 10 people found the following review helpful
5.0 out of 5 stars Statistics Made Entertaining (How is that even possible?) well it is.
This is a fascinating exploration into statistical modelling. Okay that may not be the most enticing reason to read a book you have ever been given but here's the deal. The author takes an approachable, narrative and witty approach to examining the successes and more often failures of predictions based on the sort of statistics that get bandied about on the news...
Published 12 months ago by Charliemonster
123 of 127 people found the following review helpful
3.0 out of 5 stars More noise than signal
Mr Silver clearly knows what he is talking about, but I'm less sure he knows how to talk about it. I assume he set out to write a chatty, non-challenging book, but the result is light on substance and structure.
The Nobel prize-winning physicist Niels Bohr famously said 'Prediction is very difficult, especially if it's about the future'. This pretty much sums...
Published 12 months ago by Robert Macdonald
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123 of 127 people found the following review helpful
3.0 out of 5 stars More noise than signal,
This review is from: The Signal and the Noise: The Art and Science of Prediction (Hardcover)Mr Silver clearly knows what he is talking about, but I'm less sure he knows how to talk about it. I assume he set out to write a chatty, non-challenging book, but the result is light on substance and structure.
The Nobel prize-winning physicist Niels Bohr famously said 'Prediction is very difficult, especially if it's about the future'. This pretty much sums up the first half of the book. Yes, the detail about the financial crisis, weather forecasting, earthquakes etc is mildly interesting, but in relation to prediction, you will be wading through a lot of noise to extract the signal ('human nature makes us over-confident predictors', 'without either good theory or good empirical data, you may as well just guess','the most confident pundits are usually the worst' etc).
The substance of the book comes in twenty pages in the middle, where Silver introduces Bayesian logic (I learnt in maths classes at school when I was fourteen so it wasn't new to me, and it doesn't need 200 pages of build up). The best section is where Silver contrasts Bayesian logic to Fisherian logic. Fisher created the maths that is used almost universally in medical and social science research to prove the efficacy of a treatment or theory. Silver explains how flawed this maths is - which is presumably why two thirds of the positive findings claimed in medical journals cannot be replicated. This is pretty heady stuff.
Silver claims that the second half of the book is about how to make predictions better. It is mostly more examples of failure, this time in chess, investment, climate and terrorism, with a few asides that might be considered signals ('testing is good', 'groups/markets tend to make better predictions than individuals'). The exception is the section on poker, which delivers the strongest message in the book: good gamblers think in probabilities (rather than dead certs) - when these probabilities diverge from the odds on offer by a suitable margin, they may place a bet. Bad poker players lose a lot more than good poker players make. The best is the enemy of the good...
Of course, the point of the book is that there is no silver bullet - good prediction requires detail, nuance, hard work, honesty and humility. It would be wrong to expect a check list for success at the end, and naturally, there isn't one. Even so, you are left with a craving for clarity.
'The Signal and the Noise' is a pleasant enough read, but it is mostly anecdote. Rather ironically, you are left to sort out the signal from noise yourself.
35 of 38 people found the following review helpful
3.0 out of 5 stars Could do better.,
This review is from: The Signal and the Noise: The Art and Science of Prediction (Hardcover)This is a book about prediction and the use of statistics to forecast future events such as earthquakes and the outcome of elections. When it's good it's a lucid and enjoyable read which makes some important points about the art of prediction, with the chapters on political punditry and economic forecasting stand out as especially good. Unfortunately this is let down by a number of problems. These include the interminable and really quite tedious chapters on poker, baseball and chess (I really don't know why the chess one is in the book at all), and the inclusion of a number of serious errors and misconceptions in the chapter on epidemiology. This last is a subject that I think I have some knowledge of, and it's disturbing to see straightforward and important factual errors - the definition of the basic reproductive rate used is badly wrong, for example (if anyone's interested the correct definition is that it is the number of new infections produced by a single infectious host *in a population of completely susceptible hosts*), and the interpretation is also wrong (it's not correct that any disease with basic reproductive rate >1 will go on to infect all susceptible hosts in the population). These are not nit-picking little errors - it's the equivalent of getting the definition of interest rate seriously wrong in a discussion of economics. These are fundamental concepts and the errors tell us that the author did not properly understand the subject that he's writing about.
The use of mathematical models in epidemiology is also portrayed in a misleading way: no-one would ever expect a simple SIR model to produce useful predictions about disease spread in a real-world population, rather these simple models are used in an exploratory way to help us understand the theoretically possible behaviours of such diseases (something which is mentioned at the end of the chapter as a bit of an afterthought). It would be better if this chapter looked at some examples where modelling has been useful in the management of disease, such as the fairly dramatic story of how models of foot-and-mouth disease spread in the UK were used to persuade the government to change policy and bring the army in to help deal with the disease during the 2001 outbreak.
A final comment is that the portrayal of Bayesian statistics as the only way to analyse data and the use of straw-man arguments to ridicule "frequentist" statistics and bash Fisher is getting really tired. I use both Bayesian and "frequentist" stats in my research and I am able to understand that both are useful under different circumstances and both have advantages and disadvantages. I suspect that if Silver had some experience with working in experimental science, for example, he would have a better appreciation for when conventional statistical analysis is a useful tool.
32 of 35 people found the following review helpful
3.0 out of 5 stars Interesting, but a bit shallow,
This review is from: The Signal and the Noise: The Art and Science of Prediction (Hardcover)Silver has some good ideas, and he is to be commended for scruplously footnoting his references, but there are some mistakes (the "cows would rate this" was from an S&P analyst,not Moody's) and he utilises heuristics he criticises elsewhere (lazily claiming the industrial revolution happened, just like that, in 1775 with the excuse "it is a nice round number").
My two main criticisms for non Americna readers is that it is quite US centric (I don't care about baseball, and the general moneyball story is impossible to avoid) and the main philosophical stuff (which was most useful and ineresting to me) makes up a small portion of the book, the majority with various examples where he makes the same arguments with interview of different people that are somewhat non-questioning.
He gives some useful examples throughout the book, covering meteorology, earthquakes, transmision of viruses, but it still feels as if it could have been cut. The stuff on Bayes is interetsing but really skates over the issue of how you come up with a Bayesian prior when you can't iteratively improve them because you do not have many data points. Given the time he spends looking at the financial crisis, this is a flaw as it reduces the "wow, Bayes is really useful" impact when it cannot offer that much resolution to the problem of predicting economic and financial crises, the key predictive failure he cites.
Even so, as a way of getting people to think a bit more deeply about what it is to make a prediction and how to know if it was well constructed, and how to integrate concepts of epistemology, it is a useful introductory book.
28 of 32 people found the following review helpful
3.0 out of 5 stars Good in parts,
This review is from: The Signal and the Noise: The Art and Science of Prediction (Kindle Edition)It's readable in the early stages, and provides an easy introduction to Bayesian probability. The stumbling blocks are the interminable sections on baseball and poker. Unless you understand and are interested in these two diversions, you'll lose the will to live. That's a pity, because the man obviously knows what he's talking about, witness his success in analysing poll data for the US elections.
9 of 10 people found the following review helpful
5.0 out of 5 stars Statistics Made Entertaining (How is that even possible?) well it is.,
This review is from: The Signal and the Noise: The Art and Science of Prediction (Hardcover)This is a fascinating exploration into statistical modelling. Okay that may not be the most enticing reason to read a book you have ever been given but here's the deal. The author takes an approachable, narrative and witty approach to examining the successes and more often failures of predictions based on the sort of statistics that get bandied about on the news channels 24-7. He offers insight into the causes of the financial crisis and shows why we sleepwalked into an avoidable catastrophe. He explains how far you can trust a weather forecast (about five days) and what to take into consideration when using it. He analyses subjects as diverse as baseball scouting, pandemic scares, earthquake prediction and why Deep Blue beat Garry Kasparov at chess. More importantly he presents the subject with a minimum of maths, with all you need to know explained in simple terms. You wont walk away from this book with the ability to do stats, but you'll be better equipped to know how to treat them.
35 of 41 people found the following review helpful
5.0 out of 5 stars A Brief Summary and Review,
This review is from: The Signal and the Noise: The Art and Science of Prediction (Hardcover)*A full executive summary of this book is available at newbooksinbrief dot com.
Making decisions based on an assessment of future outcomes is a natural and inescapable part of the human condition. Indeed, as Nate Silver points out, "prediction is indispensable to our lives. Every time we choose a route to work, decide whether to go on a second date, or set money aside for a rainy day, we are making a forecast about how the future will proceed--and how our plans will affect the odds for a favorable outcome" (loc. 285). And over and above these private decisions, prognosticating does, of course, bleed over into the public realm; as indeed whole industries from weather forecasting, to sports betting, to financial investing are built on the premise that predictions of future outcomes are not only possible, but can be made reliable. As Silver points out, though, there is a wide discrepancy across industries and also between individuals regarding just how accurate these predictions are. In his new book `The Signal and the Noise: Why So Many Predictions Fail--but Some Don't' Silver attempts to get to the bottom of all of this prediction-making to uncover what separates the accurate from the misguided.
In doing so, the author first takes us on a journey through financial crashes, political elections, baseball games, weather reports, earthquakes, disease epidemics, sports bets, chess matches, poker tables, and the good ol' American economy, as we explore what goes into a well-made prediction and its opposite. The key teaching of this journey is that wise predictions come out of self-awareness, humility, and attention to detail: lack of self-awareness causes us to make predictions that tell us what we'd like to hear, rather than what is true (or most likely the case); lack of humility causes us to feel more certain than is warranted, leading us to rash decisions; and lack of attention to detail (in conjunction with self-serving bias and rashness) leads us to miss the key variables that make all the difference. Attention to detail is what we need to capture the signal in the noise (the key variable[s] in the sea of data and information that are integral in determining future outcomes), but without self-awareness and humility, we don't even stand a chance.
While self-awareness requires us to make an honest assessment of our particular biases, humility requires us to take a probabilistic approach to our predictions. Specifically, Silver advises a Bayesian approach. Bayes' theorem has it that when it comes to making a prediction, the most prudent way to proceed is to first come up with an initial probability of a particular event occurring (rather than a black and white prediction of the form `I believe x will occur'). Next, we must continually adjust this initial probability as new information filters in.
The level of certainty that we can place on our initial estimate of the probability of a particular event (and the degree to which we can accurately refine it moving forward) is limited by the complexity of the field in which we are making our prediction, and also the amount and quality of the information that we have access to. For instance, in a field like baseball, where wins and losses mostly comes down to two variables (the skill of the pitchers, and the skill of the hitters), and where there is an enormous wealth of precise data, prediction is relatively straightforward (but still not easy). On the other hand, in a dynamic field such as the American economy, where the outcomes are influenced by an enormous number of variables, and where the interactions between these variables can become incredibly complex (due to things like positive and negative feedback), probabilities become a whole lot more difficult to pin down precisely (though they often remain possible on a general and/or long-term scale).
It is also important to recognize that while additional information can help us no matter what field we are trying to make our prediction in, we must be careful not to think that information can stand on its own. Indeed, additional information (when it is not met with insightful analysis) often does nothing more than draw our attention away from the key variables that truly make a difference. In other words, it creates more noise, which can make it more difficult to identify the signal. It is for this reason that predictive models that rely on statistics and statistics alone are often not very effective (though they do often help a seasoned expert who is able to apply insightful analysis to them).
In the final stage of the book Silver explores how the lessons that he lays out can be applied to such issues as global warming, terrorism and bubbles in financial markets. Unfortunately, each of these fields is a lot noisier than many of us would like to think (thus making them very difficult to predict precisely). Nevertheless, the author argues, within each there are certain signals that can help us make better predictions regarding them, and which should help make the world a safer and more livable place.
If you are hoping that this book will make you a fool-proof prognosticator, you are going to be disappointed. A key tenet of the book is that this is simply not possible (no matter what field you are in). That being said, Silver makes a very strong argument that by applying a few simple principles (and putting in a lot of hard work in identifying key variables) our predictive powers should take a great boost indeed. A full executive summary of this book is available at newbooksinbrief dot com; a podcast discussion of Silver's treatment of Bayes' theorem is also available.
2 of 2 people found the following review helpful
4.0 out of 5 stars 3.5 - 4 stars,
This review is from: The Signal and the Noise: The Art and Science of Prediction (Hardcover)Nate Silver's book is very well written and accessible read. It is also wide ranging in coverage though with a distinct American flavour. As he has a well deserved reputation as a successful Bayesian practitioner my expectations for a more insightful book were somewhat frustrated. However this is nevertheless a good enough and friendly introduction to the "Art and Science" of prediction.
7 of 8 people found the following review helpful
3.0 out of 5 stars So will you like the book?,
If however you have never heard of Bayes' Theorem and you don't have a background or training in statistics (like me)then the likelihood of you enjoying the book is greater. However, though, I liked it, in the sense that overall I found it interesting, I only gave it three stars. Why?
First of all the book is quite uneven on the topics it discusses. The chapters on the failure of ratings agencies to predict the sub prime crash, on why it is so difficult statistically to predict earthquakes, or why weather forecasting has improved (and incidentally why private weather channels deliberately forecast a higher probability of rain than is actually merited) are good chapters. Others are only so-so, and feel like they have been padded out, like the chapter on economic forecasting, which does not end up saying anything that you don't already know (economists are rubbish at forecasting). And there are chapters that are just plain dull - like the ones on baseball and poker for instance. Some chapters rate five stars for interest, others three stars and some just the one star. It's a very variable reading experience.
Second, the underlying range of ideas, despite the eclecticism of the topics discussed, seems to be quite narrow. The book seems to be saying that the difficulty of predicting any given event, from earthquakes to the outcome of elections, depends on the availability of data. With earthquakes, the big ones, the ones we really need to worry about, these are hard to predict because we have observed or recorded so few of them. The problem is too few data. But baseball matches produce lots of data, and are therefore the outcomes are easier to predict.
The book is valuable in that it seeks - rightly so - to counteract the tub-thumping certainties of media pundits. It is an important insight to realize that all predictions are about degrees of wrongness. But somehow these insights do not cohere into a sustained thesis. Instead the book reads like a collection of loosely organised chatty discussions.
I wanted to like this book because I admired the author's recent triumph with his successful prediction of the outcome of the 2012 US presidential election. But this book might have been improved with the chapters on baseball and poker being pulled out and the rest of the book edited down. Then it would have served a good introduction to the perils and pitfalls of forecasting. Then I would probably have given it five stars. But as it currently stands, I feel I can only give it three stars.
1 of 1 people found the following review helpful
5.0 out of 5 stars Jack Bauer ain't as good as you say, Nate,
Now more than ever we are bombarded with information, and somehow we have to make sense of it in order to make sense of life and make decisions based on what we predict the future will bring.
As Nate Silver, statistics wunderkind, prince of predictions, tells us in his enlightening book, in order to do so we need to be able to differentiate between signal and noise, and act on what the signal is telling us. "We think we want information," he says, "when we really want knowledge."
If only the Highways Agency could get that into their heads, I'll be a lot better served on the A1 in future.
Following a brief preamble taking in Caesar's failure to heed the right warnings, the wars emanating from Luther's ninety-five theses and the lack of availability of a theory which would have helped avert 9/11, Silver's first target is the wideranging failure to predict the financial meltdown of 2007-8. In particular the failure of the ratings agencies to understand the weakness of their models, based as they were on data formed almost exclusively from a boom period. Charles Wheelan, in Naked Statistics, makes a similar point about other models in operation at the time, singling out JP Morgan in particular.
He then takes in a number of other fields in which predictions have too often been based on noise rather than signal. In discussing television pundits he invokes Philip Tetlock's characterisation of people as either foxes, who know many things, and hedgehogs, who know one big thing, in which the foxes, believing in a plethora of little ideas, and taking multiple approaches to problems, transpire to be the better forecasters. In discussing weather forecasting he evokes amazement that, given the complexity of the system with which forecasters are dealing, in which chaos theory rules, forecasters are now able to get so much right. And in exposing the failures of earthquake forecasting he discusses the problems of overfitting.
Having discussed the problems he introduces the principles of Bayesian theory and how they can help with filtering out noise. One of his illustrations of the principles is through an account of the "Poker bubble". My own personal takeaway from that chapter was "Don't play poker: you'll lose". The game, as with playing the stock markets, he later reveals, is based upon the presence of plenty of suckers who don't know what they're doing. Without them, there's no money to be made, and sooner or later, chances are you'll end up a sucker.
Throughout, Silver provides very clear explanations of his subject matter: Efficient Market Hypothesis, heuristics, agent-based models and many others. He is very good on the subject of climate change, where he emphasises the significance of the data, points out that many so-called "sceptics" don't actually question the fact of climate change, just what the true consequences will be, and cites William Nordhaus's argument that it is precisely the uncertainty of climate forecasting that is the reason for action. He also makes a far better fist of differentiating accuracy and precision than did the aforementioned Charles Wheelan.
Overall, then, a useful, instructive and entertaining read. Unfortunately, in a book about forecasting, the word "forecasted" crops up a lot, a construct I'd accept from children but for grown-ups "forecast" suffices as past tense and past participle. If baseball isn't your thing, you have to cling very hard to academic detachment in chapter 3 in order to stay engaged. And contrary to what Silver says, Jack Bauer did not prevent a nuke from being detonated in LA: one of the five he was chasing in Series 6 destroyed Valencia.
1 of 1 people found the following review helpful
4.0 out of 5 stars Statistics for everyone,
Customer review from the Amazon Vine Programme (What's this?)Nate Silver comes with big credentials, and that's why his name is big on the front cover and not the title. After all, he is the man who succeeds in predicting election outcomes. In the first half of the book, we are treated to his preferences in life: baseball and statistics, slagging off economists, appreciating hard working weathermen, the disasters of trying to predict earthquakes, and more baseball. He goes into intricate details when it comes to baseball. He is also quite good at mentioning his successes. And others' failures. The first half of the book is strange, not really a story, not really scientific, just lots and lots of examples of people trying to predict things and the failures and successes. And lots of baseball detail.
As an aside: it shows how far the American use of the English language (or at least Nate Silver's use of it) has drifted away from British English.
In chapter 8 then we are introduced to his central tool, Bayes' Theorem. To see it applied to betting and games like chess and poker, makes for interesting reading. I must say that his informal, un writerly style of writing is an easy enough read, even so I skipped lots. You could probably learn the essentials of his approach in a book a quarter of this one's size, or less: what are the possibilities and the limits of predictions and what are the tools that can be applied. What comes out well is the importance of critical appraisal and the dangers of wishful thinking and self delusion. There are also some interesting thoughts on correlation and modelling, especially their limits.
May be it does need all those examples, and who doesn't like to read how stupid the bankers behaviour was to get into such a mess. Except, those were not stupid people, they had scientist and the best Mathematicians they could buy, and still it went wrong. Because they were interested in keeping it going, it made them rich. I reckon, it will happen again, Byes' Theorem or no, especially if the profit is private, but the risk public. Because what happens depends on interests, not on good science. Why are we still burning coal and oil?
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The Signal and the Noise: The Art and Science of Prediction by Nate Silver (Hardcover - 27 Sep 2012)