Problem
Hidden assumptions can make predictions fail.
Action
Examine the key assumptions behind a forecast before accepting it.
Outcome
You identify weaknesses before they lead to errors.
Chapter: A catastrophic failure of prediction
Problem
Confident opinions are often mistaken for accurate predictions.
Action
Compare a forecaster’s past predictions with actual outcomes.
Outcome
You rely on more trustworthy sources.
Chapter: Are you smarter than a television pundit?
Problem
Forecasting skill cannot improve without measurement.
Action
Record predictions and regularly compare them with results.
Outcome
You learn which forecasting methods work best.
Chapter: All I care about is W’s and L’s
Problem
Absolute predictions hide real uncertainty.
Action:
State the likelihood of outcomes rather than making certain claims.
Outcome
Expectations become more realistic.
Chapter: For years you’ve been telling us that rain is green
Problem
Irrelevant information can hide useful patterns.
Action
Give attention to data that consistently relates to the result you want to predict.
Outcome
Important signals become easier to detect.
Chapter: Desperately seeking signal
Problem
Average outcomes can hide significant risks.
Action
Evaluate both common and extreme scenarios before deciding.
Outcome
You are better prepared for uncertainty.
Chapter: How to drown in three feet of water
Problem
Poor prediction habits often produce poor results.
Action
Study how skilled forecasters gather evidence and make judgments.
Outcome
Your forecasting process becomes stronger.
Chapter: Role models
Problem
Old conclusions can remain wrong after conditions change.
Action
Revise forecasts whenever credible new information becomes available.
Outcome
Your predictions stay closer to reality.
Chapter: Less and less and less wrong
Problem
Models can fail when their assumptions no longer match reality.
Action
Check whether model predictions fit current conditions before using them.
Outcome
You avoid errors caused by blind reliance on models.
Chapter: Rage against the machines
Problem
Waiting for certainty can lead to missed opportunities.
Action
Choose the option with the best expected outcome even when uncertainty remains.
Outcome
You make better decisions under uncertainty.
Chapter: The poker bubble
Problem
Data and intuition are both incomplete on their own.
Action
Use data-driven evidence to support expert judgment when making forecasts.
Outcome
Predictions become more reliable.
Chapter: If you can’t beat ‘em …
Problem
Blind belief and blind doubt both distort conclusions.
Action
Question claims carefully while remaining open to strong evidence.
Outcome
Your judgments become more balanced.
Chapter: A climate of healthy skepticism
Problem
Unknown factors can create major forecasting errors.
Action
List important uncertainties before making a prediction.
Outcome
You manage risk more effectively.
Chapter: What you don’t know can hurt you