Tuesday, February 5, 2008

Heads You Win, Tails You Die

I was thinking of calling this post 'confessions of a former futurist' as I reflected on a podcast interview with Paul Saffo, Silicon Valley's futurist-in-residence. Listening to Saffo it struck me that the most important aptitude required for forecasting is humility.

In fairness, I think Saffo has this aptitude. He quotes Stuart Brand as saying that "in the past strategy was about 'ready-aim-fire', in the future it will be 'ready-fire-steer'". In other words, forget the five year plan and think about it as more of a dance with customers, competitors and markets ... or maybe it's musical chairs?

In a world divided between 'Mediocristan' and 'Extremistan' (to use the terminology coined by Nassim Nicholas Taleb) we need to think in terms of probabilities rather than certainties. Which is why I like Long Bets - using prediction markets to anticipate big changes in the future. For example, the odds on there being fewer humans in the world in 206o than there are today: 47%.

Of course, who'll survive to collect their winnings is a different matter entirely.

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