NEW YORK (CBSNewYork) - On today’s WCBS Eye on Politics segment, we have something a little different. We have a look at numbers.
You may know Nate Silver from his New York Times political blog fivethirtyeight.com or his amazingly accurate system to predict baseball performance or his spot-on forecast of the 2008 presidential race.
Now, he has a new book. It’s called “The Signal And The Noise: Why So Many Predictions Fail – But Some Don’t.”
He checked in with WCBS 880′s Steve Scott.
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From Wall Street to political pundits to baseball executives, everyone makes predictions. Why do some pan out while others don’t come close?
“So, we have more information in the world today than we had at any point in the past. By IBM’s estimate, for example, 90 percent of the information in the world, the data in the world, was created in the past two years,” Silver told Scott. “The problem is that relatively little of that information is actually very useful. A lot of it is YouTube clips or spam, e-mail spam or text messages sent around. So, the skill now is do you have people who can detect the useful signal from what what we call ‘all that noise’ – all that useless information?”
“You have to think about how to extract a signal from, for example, in political polling where you have a lot of contradictory data. Where does the real truth lie there? And you have to be willing to kind of change your mind as the facts and circumstances do, which is something that a lot of us are not always very good at doing,” Silver said.
“How much of making predictions is pure numbers, pure mathematics, and how much is gut and experience?” asked Scott.
“Well, I tend to do downplay the gut part. I think our guts are often very good for making everyday life decisions, but not necessarily so good for making decisions when we’re bombarded with more information than we would naturally take in,” Silver said. “We are wired to detect patterns. We are wired to react very quickly to stimuli we might see in our natural environment. The example I gave in the book is if you’re a kind of neanderthal cave man protecting your family and you hear a rustling in the wind, you have to decide very quickly – is that a lion or a jaguar or something or is it just the wind? You have a kind of fight or flight reaction to it. You don’t want to react that though way when you’re bombarded with all kinds of different stimuli at once.”
You can get yourself in a lot of trouble if you kind of look at every poll and take it way too literally in politics or the ups and downs of baseball season or playing a poker hand… or something else,” he said. “You have to learn to think a little bit more slowly and carefully through things and experience can help with that, but… you don’t always want to go with your first instinct. That’s what everyone else is going to do and so, if everyone else’s instinct leads them off a cliff then you’ll just fall too.”
In the book, Silver introduces readers to several forecasters in everything from weather to baseball to politics.
What key quality or qualities do they all have in common?
“It is, I think, this thing about thinking in terms of probabilities and that comes naturally if you are a sports fan and if you were a Washington Nationals fan, for example, you might have known that your team statistically had a 99 percent of winning, of closing out that game five against the St. Louis Cardinals and that one percent chance came up, right? So, you experience it in a very visceral heartbreaking, obviously, way if you were from Washington,” Silver. “Anytime you’re dealing with human beings and they have certain tendencies that prevail more often than not over the long run, but they can also be unpredictable creatures and where to we meet that balance between predictability and unpredictability?”
“That’s where this whole idea of kind of the way gamblers or investors or sports fans look at the world. They’re actually a lot better, I think, sometimes, than the economists and the political scientists in terms of actually having an extra conception of what we know and what we don’t,” said Silver.
What’s Silver’s prediction for November 6?
“So, we have Obama as having a very slight advantage,” he said. “If you look at the states that would give him the decisive electoral vote, meaning states, potentially, like Iowa or, especially, Ohio, he still seems to be a little bit ahead in the polls right now there.”