People who have read my essays and articles at a number of different websites and blogs over the years know that I make a distinction between “predictions” and “forecasts”. I have my own view of each and neither is particularly surprising, but I should take a very brief moment to define them.
Predictions are those statements made about future events that include specific details as to when, what, who, and so forth. Examples abound – where the Dow Jones will finish in 2011, whether the Eurozone can survive the year intact, whether gold will fall to $800 or rise to $2,000, $5,000 or whatever, who will win the Super Bowl, whether Barack Obama will choose to run for a second term or not, whether John and Mary’s marriage is going to end in divorce, the list is nearly endless. I don’t give much weight to the specifics, but will read the author’s reasoning if the subject interests me. However, I see predictions as guesswork and of limited use, if any.
I prefer forecasts which look at two or more potential future general scenarios, each with a different outcome, and which attempt to guess which general scenario is most likely, but never suggesting that that scenario is certain and always recognising that future events that cannot be known now may change the forecast radically. It is the difference between saying, for example, “Gold will reach $3,000 an ounce by December 31st of 2011” and “Gold will likely continue to increase in value in 2011, barring an unforeseen event”.
Predictions are much more popular than forecasts with most folks. I think in part this is because we humans find an unpredictable future frightening and want to believe that there is someone or some “system” or some chart from the past that can accurately predict the future. I don’t believe it. I accept that I, you, and everyone else in our species are imperfect humans, incapable of predicting the future with any accuracy. We can get lucky, and when we do, we may prefer to believe that we have unique and brilliant foresight. I call it luck.
And in part, I think predictions are more fun. They keep the idle busy with something to argue about for a few days, maybe even a few weeks, before the old predictions are forgotten and new ones have sprung up to take their place, providing more grist for the yadda-yadda mill. Given that attitude, you can understand why I do not claim to be able to make a specific prediction of the future, but focus on forecasts that are open to modifications, even reversal, as the future unfolds.
In other words, the future is a moving target that we hit squarely only when we get lucky. The best we can hope for is to make a forecast broad enough that it includes whatever actually happens. I have read a few of those in the past and am always amused later to hear the forecaster insist that he or she “predicted” the specific outcome when in fact they only had made a general forecast.
So here I am, making my first (and only) prediction for 2011. This brings me to Julian Assange and WikiLeaks.
I am not at all obsessed with these “leaks”. After 44 years of working globally for public agencies and private businesses, I am not shocked by what I read. I am amused sometimes and annoyed sometimes and disappointed sometimes, but not shocked at all. WikiLeaks is one of those melodramas that I cannot influence in any way, so I just watch it unfold without allowing it to take so much of my attention that I fail to follow other trends and events that are far more likely to severely impact me and the world I live in.
However, I an aware that Julian has set aside certain files for release if he feels he is in danger or otherwise about to be compromised. And I am told that these are supposed to be the truly shocking files, the so-called “thermonuclear option”. If you are not already aware, these files have already been released and downloaded tens of thousands of times. Their contents are unknown at the moment as they are heavily encrypted which only makes sense.
At this point, I encourage you to take a moment to read this article at Popular Science.
OK, assuming you have read that article, here’s a prediction. That huge 1.4 gigabyte download will be unencrypted and available to the public within the next 12 months.
Well, that was easy. So let me go on and make a forecast. IF that huge download includes information that truly deserves to be called “thermonuclear”, than there is a much higher than normal probability that ALL of the major predictions (those involving money and politics) being made right now about 2011 may all be wrong, every last one of them.
Every new year brings with it some of Nassim Taleb’s “black swans”, those events that might be forecast but cannot be predicted, come as a great shock when they occur, and thus have huge consequences. Rarely do we have a potential black swan dressed up in a bright white outfit like this one of Julian Assange’s.
In my mind, and apparently in those of the general public from what I can tell, the leaks so far have been popcorn, tasty while being consumed, but forgotten shortly thereafter. Is this download just a huge bowl of popcorn, albeit spicy? Or is it truly “thermonuclear”? Will it shake the world or just end up being a dud? This is one prediction I cannot make.
So let us go on and read the predictions of others, perhaps make some of our own, and fuss and fret about them if we have the time and inclination. But let’s not forget that black swan dressed in white. If the bomb it carries inside is thermonuclear, it could blow every other prediction out of the water.
NOW WATCH: Money & Markets videos
Business Insider Emails & Alerts
Site highlights each day to your inbox.