signalnoise

Author: Nate Silver

Rating: 8/10

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Nate Silver has become a sort of celebrity in recent years.


Nate first came to notoriety when he predicted the results of the 2008 election in 49 of the 50 states. I started reading this book just before the 2012 election, and followed with interest his New York Times blog where he posted his predictions. This time he did even better: 50 out of 50... a perfect score! With this track record, one would think that Nate has some sort of "magical" and obscure process for his predictions. Surprisingly though, the processes described in his book reflect a rather measured and methodical approach. In fact, as Nate puts it in one of the chapters, the best predictions typically come from low-key, modest characters and not from flamboyant bold predictors we are accustomed seeing on TV screens. Perhaps more importantly, good predictions recognize the "noise" in the data, and that sometimes the system is so complex (the economy and the stock market come to mind) that most predictions are bound to fail.

A fascinating aspect of this book are the many accounts Nate provides in so diverse fields as weather forecast, global warming/climate change, earthquake prediction, baseball and even the stock market. (One can tell Nate is passionate about baseball, but if like me, you are not interested in that topic, do yourself a favor and skip that chapter:). This is an excellent book for anyone interested in understanding what makes good predictions and how to identify exaggerated and overconfident ones from so called "experts". Highly recommended. 

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