Silver sheds light on prognosticating in new book
Silver, the auteur of political blog FiveThirtyEight and the creator of the PECOTA projection system for Baseball Prospectus, has brought his keen statistical mind to the way humans forecast the future in his new book, "The Signal And The Noise: Why So Many Predictions Fail -- But Some Don't."
That work, which took more than three years to finish, is an engaging look at how human beings in all walks of life use probability to best handicap the future. Silver, using a firm grasp of statistics and a sturdy sense of humor, had set out in this direction before with both of his prior projects.
PECOTA was designed to compare baseball prospects to each other and to forecast their future, while FiveThirtyEight strives to make sense of the many political polls that sometimes seem in conflict with each other. Silver, in other words, separates the signal from the noise for a living.
And in his book, which came out Monday, Silver uses his same scholarly diligence and conversational style to explain some difficult concepts. He breaks down how poker players think at the table, for instance, and explains that it's less about counting cards than hedging your bets.
"The midpoint between perfect knowledge and perfect ignorance is probability," said Silver when reached by telephone on Friday. "We're looking for the medium tendency.
"It's just a guess, but it's the best guess and it presents a range of outcomes. There's an upside price and a downside price, a reasonable best-case and a reasonable worst-case scenario. Nobody can make exact predictions, but I can tell you which outcome I'd be more likely to bet on."
And that -- making the best pick with the best information possible -- is a science more than it is an instinct. Silver isn't talking about simply playing a hunch; he's talking about having an hypothesis and testing it, and knowing the consequences and repercussions of any choice before you make it.
The topic may be as benign as picking what to wear or which road to take to work, but humans are constantly weighing the odds and selecting the option that seems most advantageous. And in Silver's mind, if we stop and think about that process, we can improve the way we think and live our lives.
Silver used his experience in baseball and politics to present an entry into the world of thinking analytically, but his book deals with a whole palette of interesting segues. There's a chapter about earthquake research right next to one about the perils of predicting the American economy.
"There was a lot of journalism, a lot of research involved. And I really enjoyed it," Silver said of the three-year process to write the book. "I basically lived the chapters about politics, poker and sports, but I was able to talk to people in a lot of disciplines that don't necessarily get a lot of attention.
"Some of these people are trying to advance the understanding of earthquakes, and they never get phone calls unless there's a disaster, so they're happy to talk to you in other circumstances."
"The Signal and the Noise" also spends a chapter on sports gambling, and it uses a successful handicapper as an access point to scientific theory. Over time, the author analyzes how information has birthed a computer that can beat a human grandmaster in chess, and he talks in great detail about the historical lessons of the financial collapse and the terrorist attacks of 9-11.
Sometimes, the author finds that we are unable to detect a pattern because we have already fixed on a pattern that better fits our prevailing opinion. He uses the lesson of Pearl Harbor, when our military analysts were so worried about domestic sabotage that they left themselves vulnerable to attack.
Everywhere, the material is handled with scholarly precision, but with a flair for making things easily understood. Silver spent much of the last few years making his own figures and his own graphic representations, a lesson he took from his work at Baseball Prospectus and FiveThirtyEight.
One memorable graphic -- designed to dispel the myths about Derek Jeter's fielding prowess -- shows a circle of the player's defensive range and an outlying fringe wherein he makes diving plays. Next to it, however, is a much larger circle designed to display the range of Ozzie Smith.
"They say that picture is worth a thousand words, and there have been studies that show people really do learn that way," said Silver. "We try to take difficult information and present it in a way that can appeal to a wide audience. It's very intuitive for sports fans to be able to see information that way."
Silver said that probability is especially applicable for baseball fans, who know that a hot prospect in their team's farm system might become a Hall of Famer or a castoff. The trick, said Silver, is knowing the range of outcomes and knowing how likely each result might be along the scale.
That also applies to Silver's day job, the FiveThirtyEight blog, which hums along in election season and tries to figure out which polls are truly reading the political wind.
"We take a weighted average of polls and we try to ascertain which have been more accurate historically," said Silver. "We're not looking to be way out there at the margins. We want to stay faithful to the consensus. Right now, for instance, the polls say that President Obama is leading Mitt Romney by five points with 40 days to go, and we want to know how that translates to win probability."
And that's the common thread in all of his work, a willingness to break down the information we do have in order to best forecast what will come next. Paradoxically, the author believes that you can only begin to predict with real accuracy once you acknowledge how much of your knowledge is uncertain.
Silver shines a light on 600 years of human intelligence-gathering -- from the advent of the printing press all the way through the Industrial Revolution and up to the current day -- and he finds that it's been an inspiring climb. We've learned so much, and we still have so much left to learn.