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Data’s getting bigger… and bigger… and...,
This review is from: The Signal and the Noise: The Art and Science of Prediction (Kindle Edition)
Just because we’ve got unprecedented amounts of data available to us, it doesn’t mean we can always make good predictions. Weather forecasting and hurricane predictions have improved over the latest ten years (the science and the modelling are understood; it was the sheer amount of number-crunching that was the problem). Other successes have taken place, in areas like spotting future baseball stars, chess programming (defined rule-sets) and political polling. But earthquake prediction is still impossible, and economic and financial analysis are still hopeless (too ill-defined, and they change as you observe them), despite the unreasonable and unreliable confidence with which they’re made. The book covers all these topics, along with climate change, terrorism and poker. It tells you why most TV pundits prefer controversy to accuracy (it gets them more notice), so are usually best ignored. Why weather forecasts longer than 6 days ahead are totally worthless. And why no-one predicted the crash (it wasn’t only that the mortage-default probability model was faulty, but also that no-one was prepared to say so). In a manner familiar from celeb-presented TV documentaries, the author goes to visit various eminences, and notes their homes and hairstyles, while they tell him elementary things that he could’ve found out from their books or website. (Such ‘interviews’ are mostly, I guess, about the author indicating his own importance, in that the celebs are willing to give time to a person of equal fame.) There’s the obligatory paean to the free-market, in the midst of documenting its faults; and a plea to think more widely about terrorism probabilities (WTC7?). Overall, it’s an absorbing read – rigorous without being too technical, clear about its wide-ranging topics and usefully illustrated with graphs.