The Economist observes that our present is not quite like some futurists of the past had projected, and provides advice to new futurists seeking to improve on the past. Among other things, they recommend “think small”: “The best what-lies-ahead book of 1982 was Megatrends, by John Naisbitt, which prophesied the future of humanity. A quarter-century later, its counterpart for 2007 was Microtrends….”
Other advice includes: think short-term, admit uncertainty, and get embedded in a particular industry. The article ends with a plug for prediction markets and the “wisdom of crowds”:
A fifth piece of advice: talk less, listen more. Thanks to the internet, every intelligent person can amass the sort of information that used to need travel, networking, research assistants, access to power. It is no coincidence that the old standard work on herd instinct, Charles Mackay’s Extraordinary Popular Delusions and the Madness of Crowds, has been displaced by James Surowiecki’s The Wisdom of Crowds.
The most heeded futurists these days are not individuals, but prediction markets, where the informed guesswork of many is consolidated into hard probability. Will Osama bin Laden be caught in 2008? Only a 15% chance, said Newsfutures in mid-October 2007. Would Iran have nuclear weapons by January 1st 2008? Only a 6.6% chance, said Inkling Markets. Will George Bush pardon Lewis “Scooter” Libby? A better-than-40% chance, said Intrade. There may even be a prediction market somewhere taking bets on immortality. But beware: long- and short-sellers alike will find it hard to collect.
While I’m partial to the plug for prediction markets, the story from the past year that best fits the five pieces of advice (think small, short-term, uncertainty, embed in an industry, and listen) was not about the “wisdom of crowds.” Rather, this profile by Michael Lewis of hedge fund/insurance risk modeler John Seo in the NYT Magazine seems to fit the bill.
[HT to Chris Masse at Midas Oracle for cite to The Economist story. Actually, come to think of it, another HT goes to Chris Masse at Midas Oracle for the cite to the story on John Seo that was published back in August.]