This was my tweet just minutes before kickoff of this past Sunday’s Super Bowl:
Privately, also just before kickoff, I was quoted as saying, “If I was rich I would bet $200,000 on Denver today.”
Here are some other famously bad predictions I’ve made:
- In 2007: “Real estate will keep skyrocketing. Wait, you can buy these houses with no money down? I’ll take 3 please!”
- In 2008: “The stock market is ready to explode. Wait, you can buy more stocks with these thingys called options? I’m all in.”
- In October 2012, just days before Hurricane Sandy formed: “We’ll never get another storm in Connecticut like last year. Sales comps are going to be easy this month!”
- In November 2012: “Mitt Romney will be the next President.”
Yes, future predicting is indeed a bad business to be in. That’s why we curse the weather man for botching the forecast, laugh at sports pundits on Mondays, and scratch our heads at studies like this one that found that monkeys can pick stocks just as good as most fund managers.
Why is predicting the future so hard? Here are some of my thoughts (with some Game Theory terms I picked up from this free online course to make me sound smart):
- The Great Randomizers in the Sky: God, Nature, Fate, Luck, and their gloomy pal Death are always meddling in human affairs. Collectively, they make even the most predictable situations unpredictable.
- Self-interested parties: People generally make decisions that maximize their own utility (or satisfaction). Future predictors like me sometimes forget this and think that other people only exist to help me achieve my goals. Big mistake.
- People get utility from unpredictable places: Some people just want money and the things money can buy. Others want power, fame, or prestige. Some people chase security and stability while others chase thrill and risk. Some people derive utility from pure altruism. And most people seek utility from their own weird blend of the millions of human virtues and vices.
- Rationality: Finally, future predicting is easier if all players are rational. But to me, most people seem to behave irrationally. People betray or honor concepts of fairness, morality, and equality by behaving in ways that seem to be contrary to their best interests. Like this example from game theory called the Ultimatum Game.
So, you might ask, “John, this is all fascinating, but what’s the point of this post?” Well, you got me there, dear reader. I’m not entirely sure.
Maybe this post is about living in the moment. I’ve spent a lot of time over the past ten years trying to establish my career and personal finances so me and my family can be happier in our future. But the future is anything but a guarantee, which means it’s not really ours just yet. All we really have this one infinitesimally small moment called the present, which indistinguishably melts into the past before we realize it. And like the fleeting moment of our individual present, we too will soon be a part of the bigger past before very long.
Whoa, that got deep quick. Sorry. In short – forget about the future and try to enjoy the game.