Appreciating the limits of your predictive power is crucial to being a wise person. Consider the track record of predictions made about
Tomorrow’s weather, next winter snowfall, and the number of hurricanes
Costs for commodity products like oil, grain, and copper
Outcomes of political elections
Which geopolitical events will drive the news
Who gets cancer or has a heart attack or stroke
We should humbled by our miserable ability to accurately predict the future.
You know those scenes in Star Trek and Star Wars where Spock and C-3PO calculate the odds of successful whatever (e.g., navigating an asteroid field)? Great fun, helps drive the plot, but impossible. They can’t calculate the odds because they don’t have enough information.
The realistic approach when you don’t have enough information is to run simulations many times. We know these simulations are based on incomplete information, so they’re inherently “wrong but useful.” We can get some idea of the range of possibilities, rather than a specific number. We can see where our “gut” response might be wildly off, or relatively aligned.
