The signal and the noise.

This is an interesting book on predicting, why some predictions succeed, and why most fail.  The research in it is fascinating, but the conclusions are little bit of a bummer.  That we will never be able to predict well, thought we can forecast, and contingency plann.  The author encourages us to think baysien about predictions, with false positives and false negatives.

nate silver was a professional poker player for a couple of years.  His insights on beating poker are in those veins.  He observes that if everyone had a poker table is good then no one is getting rich.  The winnings are distributed randomly. the players are just passing money amongst each other.  To win at poker you need to have a loser at the table.

Spotting the losers is hard work.  It's not just a guy who's winning the most often.  That could be a good player who's having a run of bad luck.

 

When the U.S. tightened up the laws about online poker playing, poker got much harder, as most of the losers stopped playing online poker. With fewer experienced losers online, fewer experienced losers headed out to the casino.

This also relates to the paritio principle, that 20% of your efforts bring 80% of the results.  If you were at a table where everyone had their basics down, then you have to put in an order of magnitude more effort in to get to the next level.  If everyone is doing that, then you have a lot of work ahead of you.  Such is the nature of highly competitive play. For every step ahead of your competition, you have to put in an order of magnitude more effort. Not a little more effort, cause anyone can do that, but a lot more effort.

Rather than predicting the author encourages us to model for insight and for contingency planning.  He also observes that when things go wrong it's because of the things we didn't expect.  We confuse unfamiliar with improbable.  He puts 911 in that category.  Suicide pilots flying planes into buildings were unfamiliar so the idea was dismissed as improbable.