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Re: Brin: predictions

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  • The Fool
    ... to find the best investors in the world and then track, analyze, and evaluate their trading activity. (I m going to get my son an account.) At
    Message 1 of 9 , Nov 1, 2005
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      > From: d.brin <dbrin@...>

      >>1. Marketocracy Data Services is a research company whose mission is
      to find the best investors in the world and then track, analyze, and
      evaluate their trading activity. (I'm going to get my son an account.)
      At www.marketocracy.com folks compete to become the best investors. For
      over 3 years they have tracked, analyzed, and evaluated their virtual
      trading activity and have accumulated a massive database; following
      over 10,000 stock positions at any one time and more than four million
      trades. Marketocracy constantly analyzes and ranks the stock picking
      ability of members using a complex algorithm that incorporates long and
      short-term performance, as well as an attribution analysis that
      accounts for market, sector, style, and trading contribution so that
      they can isolate comparative returns.

      These guys appear to be the closest to the real thing so far. You could
      squint and imagine their software and approach being applied on a much
      broader scale to predictions across a huge range of topic areas, from
      politics to sports... and even to science. If I ever find time, I may
      try to contact them about this possibility. I can think of few
      endeavors that have greater potential for helping a society in flx,
      than to come up with methodologies for identifying people who are right
      a lot... and those who are too often wrong to deserve our credibility
      and trust

      ---
      Holy incestuous Feedback Batman!

      It'll never work. Heisenberg had it right.
      _______________________________________________
      http://www.mccmedia.com/mailman/listinfo/brin-l
    • The Fool
      ... Possibly. Or is it that some people are wrong more often than other people? The people who tend to be right have this habit of also tending to be
      Message 2 of 9 , Nov 1, 2005
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        > From: David Brin <dbrin@...>
        >
        >
        > > Holy incestuous Feedback Batman!
        > >
        > > It'll never work. Heisenberg had it right.
        >
        >
        > SO you are saying that nobody is right more often than
        > other people?

        Possibly. Or is it that some people are wrong more often than other
        people? The people who tend to be right have this habit of also
        tending to be ignored. The people who tend to be wrong tend to not be
        ignored.

        >
        > Or that some people do not deserve more credibility
        > than others, for being right more often? Hm. Unique.

        I was mostly reffering to the bit from the first paragraph about the
        markets. But it's similar. You can't know you're right until after
        the fact, in which case you can't predict who will be right without
        effecting positively or negatively whether they will be right. All of
        society is one big nested group of nested feedback cycles (a human is
        really just a system of feedback systems).

        It reminds me of this one episode of Logans Run where this guy invents
        time travel and comes to the future, but the future is that dystopia of
        the Logans Run Movie / Tv Series. So he goes back in time in order to
        try and prevent that future dystopia from happening. In the end it
        turns out that his very going back to try prevent it was what caused it
        to happen.

        But I digress, I was mostly reffering to the market bit.
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      • David Brin
        ... SO you are saying that nobody is right more often than other people? Or that some people do not deserve more credibility than others, for being right more
        Message 3 of 9 , Nov 1, 2005
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          > Holy incestuous Feedback Batman!
          >
          > It'll never work. Heisenberg had it right.


          SO you are saying that nobody is right more often than
          other people?

          Or that some people do not deserve more credibility
          than others, for being right more often? Hm. Unique.
          _______________________________________________
          http://www.mccmedia.com/mailman/listinfo/brin-l
        • The Fool
          ... But it is also true that the attention some people get affect whether what they say happens or not. Incestuous feedback. So if you start pegging person
          Message 4 of 9 , Nov 1, 2005
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            > From: David Brin <dbrin@...>
            >
            > I agree that most market computer models wind up
            > screwing themselves because the market has an immune
            > reaction, adapting to one participant's success.
            >
            > Still, some people are right a LOT more than others.

            But it is also true that the attention some people get affect whether
            what they say happens or not. Incestuous feedback. So if you start
            pegging person A of being slightly more right than offen than people
            will start treating A's thoughts as if they should be right which leads
            straight to him being slightly more right more often. Wash and repeat.

            But what if Person A's ideas are flawed or bad in some way and he
            starts getting treated as if his ideas are genius? Like say...Marx.
            Or the people who invented that Yeshua of Nazereth character?

            > Past performance does not predict future success. But
            > it is relevant to competance.

            I think this is incorrect, hence my counterexamples above. I think
            competence can be unrelated.

            _______________________________________________
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          • David Brin
            I agree that most market computer models wind up screwing themselves because the market has an immune reaction, adapting to one participant s success. Still,
            Message 5 of 9 , Nov 1, 2005
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              I agree that most market computer models wind up
              screwing themselves because the market has an immune
              reaction, adapting to one participant's success.

              Still, some people are right a LOT more than others.
              Past performance does not predict future success. But
              it is relevant to competance.
              _______________________________________________
              http://www.mccmedia.com/mailman/listinfo/brin-l
            • Dan Minette
              ... From: David Brin To: Killer Bs Discussion Sent: Tuesday, November 01, 2005 3:53 PM Subject: Re: Brin:
              Message 6 of 9 , Nov 3, 2005
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                ----- Original Message -----
                From: "David Brin" <dbrin@...>
                To: "Killer Bs Discussion" <brin-l@...>
                Sent: Tuesday, November 01, 2005 3:53 PM
                Subject: Re: Brin: predictions


                >
                > > Holy incestuous Feedback Batman!
                > >
                > > It'll never work. Heisenberg had it right.
                >
                >
                > SO you are saying that nobody is right more often than
                > other people?
                >
                > Or that some people do not deserve more credibility
                > than others, for being right more often? Hm. Unique.

                I think that the problem with such a technique is properly identifying the
                statistics associated with being right n times out of m. Let me give two
                examples that frame the problem.

                1) Let us consider a single elimination tournament based on coin flipping.
                Person 1 flips a coin. If person 2 matches the flip, they win; otherwise
                person 1 wins. If there 2^16 people entered in the tournament, there will
                be one person who won 16 times in a row. This person, with a perfect
                score, is no more likely to win the next coin flip game than anyone else.

                A real life situation that almost matches this is the performance of
                various investment funds. There are funds that boast of being better than
                the average of all other funds for 9 years out of the last 10. Yet, when
                funds like these are examined, they tend to have no more chance of being
                above the average for the 11th to 15th year than any of the other funds.
                It's akin to there being a 50-50 chance that a given physician was in the
                bottom half of his/her class at medical school. Past performance is, when
                considering funds in this manner, rarely an indicator of future
                performance.

                There are exceptions to this rule, of course, a very good case for Buffet
                can be made: that he really does know more about investing than most fund
                managers. His performance is longer term, and more statistically
                significant.

                2) Richard Feynman is the classic example that I have for the other end of
                the spectrum. As with many areas of physics, Dr. Feynman made a rough
                guess predicting the rapidity distribution of pions in high energy
                interactions. Feynman scaling was found to be right, to the order of
                magnitude that he predicted this.

                As you know, but many on the list do not, he made many intuitive
                predictions, such as this, after he was a high profile physicist. If you
                look at the predictions made by physicists with a high profile, you will
                see his stand out. The percentage of times he "guessed right" was near
                legendary when I went to school. There was a rule of thumb that a Feynman
                guess was worth more than careful computation by nearly anyone else.

                My gut feeling is that an open prediction registry will be closer to the
                funds manager case than the Feynman case. I think a critical factor is
                limiting the number of potential candidates for being right. There are not
                that many physicists who have already done stand-out work. Thus, we do not
                have enough predictions to have a track record like Feynman emerge from
                mere chance.

                In economics, the clear example is Greenspan. List member and fairly well
                known economist, Brad DeLong, has noted how often Greenspan has guessed
                right when he himself has guessed wrong. He talked about cloning Greenspan
                because he has an uncanny ability to "guess right".

                Since there is only one chairman of the Fed. Reserve Board at any one time,
                this track record cannot be explained by statistics alone. There has to be
                some skill that Greenspan has that Brad does not. Brad acknowledges the
                skill, but cannot put his finger on exactly what it is.

                The common denominator that I see between Greenspan and Feynman is that
                they demonstrated, apart from their intuitive ability, above average skill
                in the field before many their guesses went on record. This culling
                significantly lowers the possibility that such a track record is due to
                chance alone. This allows those with unique intuition to rise above the
                background of lucky guessers.

                The final factor that I wish to consider is what I'd call the "astrology"
                factor. If you look at general predictions of astrology for most people,
                there will almost always be a manner in which the predictions were right.
                The reason for this is not due to a real power of the planets over our
                lives, of course, but the real power of people to match vague predictions
                to what actually happened and thus see the predictions validated. In the
                case of Feynman and Greenspan, there were hard numbers that their
                predictions can be matched against. I believe that aspects of science
                fiction novels that are later matched to reality can suffer from the same
                "20-20 hindsight" problem. The parts of the prediction that match are
                focused upon, and the differences are minimized. Thus, the predictions
                seem more accurate than they really were.

                So, while I am intrigued by the idea of a predictions registry, I think
                that there are two factors that must be considered before such a registry
                could really be useful.

                1) A means of lowering the probability that good looking track records will
                emerge from chance alone.
                2) A means of setting firm criteria for determining sucess (which of course
                ties into 1).

                Dan M.

                _______________________________________________
                http://www.mccmedia.com/mailman/listinfo/brin-l
              • The Fool
                ... astrology ... people, ... right. ... our ... predictions ... the ... science ... same ... are ... predictions ... AKA Subjective Validation, Confirmation
                Message 7 of 9 , Nov 3, 2005
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                  > From: Dan Minette <dsummersminet@...>
                  >
                  > From: "David Brin" <dbrin@...>
                  >
                  > >
                  > > > Holy incestuous Feedback Batman!
                  > > >
                  > > > It'll never work. Heisenberg had it right.
                  > >
                  > >
                  > > SO you are saying that nobody is right more often than
                  > > other people?
                  > >
                  > > Or that some people do not deserve more credibility
                  > > than others, for being right more often? Hm. Unique.
                  >
                  >
                  > The final factor that I wish to consider is what I'd call the
                  "astrology"
                  > factor. If you look at general predictions of astrology for most
                  people,
                  > there will almost always be a manner in which the predictions were
                  right.
                  > The reason for this is not due to a real power of the planets over
                  our
                  > lives, of course, but the real power of people to match vague
                  predictions
                  > to what actually happened and thus see the predictions validated. In
                  the
                  > case of Feynman and Greenspan, there were hard numbers that their
                  > predictions can be matched against. I believe that aspects of
                  science
                  > fiction novels that are later matched to reality can suffer from the
                  same
                  > "20-20 hindsight" problem. The parts of the prediction that match
                  are
                  > focused upon, and the differences are minimized. Thus, the
                  predictions
                  > seem more accurate than they really were.

                  AKA Subjective Validation, Confirmation Bias, and the Forer Effect:

                  <<http://skepdic.com/forer.html>>

                  <<http://skepdic.com/confirmbias.html>>

                  <<http://skepdic.com/subjectivevalidation.html>>

                  And of course the for lack of better term the "nodding" effect:
                  <<http://www.futurepundit.com/archives/001505.html>>
                  _______________________________________________
                  http://www.mccmedia.com/mailman/listinfo/brin-l
                • Nick Arnett
                  Perhaps a better question is, are some *communities* right more often than most? ... -- Nick Arnett narnett@mccmedia.com Messages: 408-904-7198
                  Message 8 of 9 , Nov 3, 2005
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                    Perhaps a better question is, are some *communities* right more often than
                    most?

                    On 11/1/05, David Brin <dbrin@...> wrote:
                    >
                    > I agree that most market computer models wind up
                    > screwing themselves because the market has an immune
                    > reaction, adapting to one participant's success.
                    >
                    > Still, some people are right a LOT more than others.
                    > Past performance does not predict future success. But
                    > it is relevant to competance.
                    > _______________________________________________
                    > http://www.mccmedia.com/mailman/listinfo/brin-l
                    >



                    --
                    Nick Arnett
                    narnett@...
                    Messages: 408-904-7198
                    _______________________________________________
                    http://www.mccmedia.com/mailman/listinfo/brin-l
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