One view I hold - one I know many people here will be skeptical of - is that the future is partially predictable in a systematic way. Not in a deterministic or oracular sense, but in the limited, Tetlock-style sense of assigning calibrated probabilities to uncertain events and doing so better than baseline forecasters over time.
I’ve spent roughly the last 15 years trying to formalize and stress-test my own forecasting process. During that period, I’ve made public, timestamped predictions about events such as COVID, the Ukraine war, and various market movements. Some of these forecasts were wrong, some were directionally correct, and many were correct with meaningful lead time. Taken together, I think they at least suggest that forecasting can be treated as a learnable, improvable skill rather than an exercise in narrative hindsight.
When I’ve raised versions of this argument in the past (including in The Motte’s earlier Reddit incarnation), I’ve consistently encountered a few objections. I think these objections reflect reasonable priors, so I want to address them explicitly.
1 - “If prediction is possible, why aren’t the experts already doing it?”
My claim is not that expertise is useless, but that many expert institutions are poorly optimized for predictive accuracy. Incentives matter. Academia, media, and policy organizations tend to reward coherence, confidence, and alignment with prevailing narratives more than calibration or long-term scoring.
One reason I became interested in forecasting is that I appear to have unusually strong priors and pattern-recognition ability by objective measures. I’ve scored in the top 1% on multiple standardized exams (SAT, SHSAT, GMAT) on first attempts, which at least suggests above-average ability to reason under uncertainty and time pressure. That doesn’t make me infallible, but it does affect my prior that this might be a domain where individual skill differences matter.
Tetlock’s work also suggests that elite forecasting performance correlates less with formal credentials and more with specific cognitive habits: base-rate awareness, decomposition, active updating, and comfort expressing uncertainty numerically. These traits are not especially rewarded by most expert pipelines, which may explain why high-status experts often underperform trained forecasters.
My suspicion - very much a hypothesis, not a conclusion - is that many people in communities like this one are already better forecasters than credentialed experts, even if they don’t label what they’re doing as forecasting.
2 - “If you can forecast, why not just make money in markets?”
This is a fair question, since markets are one of the few environments where forecasts are continuously scored.
I have used forecasting methods in investing. Over the past five years, my average annual return has been approximately 40%, substantially outperforming major indices and comparable to or better than many elite hedge funds over the same period. This is net of mistakes, drawdowns, and revisions—not a cherry-picked subset.
That said, markets are noisy, capital-constrained, and adversarial. Forecasting ability helps, but translating probabilistic beliefs into portfolio construction, position sizing, and risk management is its own discipline. Forecasting is a necessary input, not a sufficient condition for success.
More importantly, I don’t think markets are the only - or even the most interesting - application. Forecasting is at least as relevant to geopolitics, institutional risk, public health, and personal decision-making, where feedback is slower but the stakes are often higher.
3 - “Where are the receipts?”
That’s a reasonable demand. I’ve tried to make at least some predictions public and timestamped so they can be evaluated ex ante rather than reconstructed after the fact.
Here are a few examples where I laid out forecasts and reasoning in advance:
https://questioner.substack.com/p/more-stock-advice
https://questioner.substack.com/p/superforecasting-for-dummies-9a5
I don’t claim these constitute definitive proof. At best, they are auditable data points that can be examined, criticized, or falsified.
What I’m Actually Interested in Discussing
I’m not asking anyone to defer to my forecasts, and I’m not claiming prediction is easy or universally applicable. What I am interested in is whether superforecasting should be treated as a legitimate applied discipline—and, if so:
Where does it work reliably, and where does it fail?
How should forecasting skill be evaluated outside of markets?
What selection effects or survivorship biases should we worry about?
Can forecasting methods be exploited or weaponized?
What institutional designs would actually reward calibration over narrative?
If your view is that forecasting success is mostly an artifact of hindsight bias or selective memory, I’d be genuinely interested in stress-testing that claim. Likewise, if you think forecasting works only in narrow domains, I’d like to understand where you’d draw those boundaries and why.
I’m less interested in persuading anyone than in subjecting the model itself to adversarial scrutiny. Looking forwards to hearing your thoughts.
Jump in the discussion.
No email address required.
Notes -
I would be surprise if anyone here doesn’t believe that forecasting is possible. My gut says there would be nearly 100% agreement that psychohistory (Foundation Series) is most likely true.
I would assume 50% of posters here could generate 40% annual returns on modest amounts of capital if they focused on earning their living in trading. It’s not an impressive number especially when you made zero mention of your risks system.
Jane Street literally recruited straight out of SSC message boards. And they do like $25 billion a year in pnl now (far less when they began recruiting from SSC).
Am I reading that right, you reckon half of people here should be able to nearly 6x their savings every 5 years?
Maybe a little less. Shape rotator brain types are the prototypical quant/prop trading personality/ability. We do have some word cells here.
In my experience about 50% of the prototypical shape rotator works out in trading. People always cite 99% of retail traders fail. But the typical MIT 800 math SAT kid can figure out a way to make money in markets. A lot of the people on the Motte fit that background.
With $1m, 3-6 months of guidance, and interest in markets - I think a person like that could find a way to make $400k over 12 months. At that scale you can do things like stare at less liquid small cap stocks and make a market or trade lumber futures. Both areas where you have a lot less competition from established players. This would not be side employment and managing a brokerage account in your free time.
In a thread about reference class forecasting, I find it curious that you can throw this out comment with a straight face.
If you have, on average, 1 person in a hundred who is capable of making money, even a poster here who is five times as likely to succeed as a normie is still likely to fail.
I have worked in prop trading. The background that Jane Street hirers - math kids seem to work out at a 50% rate.
It’s like the NBA. A 7’ kid has like a 35% chance of making the NBA while the average person is not distinguishable from zero. We have a lot of 7’ kids in rational community.
I'll defer to your expertise but I personally find it hard to believe that a combo of scepticism and comp sci skills turn a 1% hire into a 50% hire.
What do you see as the actual attributes that lend themselves to forecasting "lumber futures" or whatever? I'm guessing there's some major filtering going on in the hiring process. Like tetlock only submitting his Superforecaster's predictions or something.
I'm sure you could take the top 50 candidates from the motte and they'd do well. But I doubt you'd be getting those results from a random sampling. Probably you beat the 1%, but you don't turn it into a 50%.
I might be high on 50%. When I got into the business things were less automated and tech may have lowered the success rate. I have tried to correct for this by giving ample capital ($1m) and saying they can play less scalable and less competitive games (small caps/smaller commodities). Avoiding super scaled trades like SP500 products where Jump etc has automated.
I am sort of assuming the average Motte poster is basically SBF - MIT/Stanford type. We probably have a few but that is probably 1-2 tiers higher intellectual firepower.
I’m not proposing huge compensation. 50% on 1m is only 500k. So not significantly more money than the same person taking Faang job and getting 10% on 1m.
This has been a twitter discussion lately on X about different prop firms and classifying them as “Chicago” style or “MIT” style. Chicago style being quanty people who take more risks (sleep on positions) with more yolo and vibe based. MIT being more pure algo trading. For the purpose of this discussion I am solely proposing a Chicago style since MIT style requires a lot of infrastructure. https://x.com/annanay/status/2012164686943261175/photo/1
I have a friend who a few years ago swapped between being “Chicago” to being “MIT”. His Chicago days were more fun. His MIT days now are a more stable lifestyle. You do not sleep well holding positions for weeks, but programming algos is much more of just a well paid 9-5 jobs.
To not dox too much he’s from a MIT/Stanford type school. He spent 5-10 years trading let’s call it cheese. At a firm but mostly siloed so had to build out what he needed himself. Think he made $20m those years. Out of college he couldn’t get into the name brand firms but he did those trades and eventually transferred.
David Orr is an interesting twitter follow. Jewish former poker pro. Not sure he went to college. Obviously some quant ability if he made it in the poker world. Started fucking around in Japanese value stocks when poker died and he fafo’d.
A lot of name brand hedge funds/firms started all have similar backgrounds. Of which the Motte has a high overlap in backgrounds with that group. Ken Griffin first started trading convertible bonds in his Harvard dorm room. Don Wilson just started showing up at the board of trade (UChicago), Tepper was pro but go fired and just yolo’d personal account (Jew ), 3red trading smaller Chicago firm like a single pod (Jew, Chess, Northwestern), Jeff Yass (poker, Jew). List could go on.
Now I started listing Jew because a lot of the firms are Jewish and it especially captures the ones without elite education. It’s probably just capturing the over representing in nobels and other intellectual achievements. It’s the only category that sometimes doesn’t have elite education too. Eliezer Yudkowsky would be an outside of the industry guy without education.
I think there are certain factors you can identify that strongly signifies they would work out in trading. Evidence of being good at math logic, Jewish, competitive mind game ability Chess/Poker. The equivalent of being 7’ tall and being able to consider basketball as a legitimate career path. Maybe 50% is too high, but if you start checking a few of “all the successful people have this background” then it’s far higher than the 0% of retail traders make money. I think the Motte has a lot of the people who check these boxes. Even more before rationalism went from a niche to a few percent of the population.
If you gave Scott Alexander a million dollars to trade prediction markets full time my gut says 12 months from now his pnl would be ok.
I want to call Jane Street as always rational from my memory. Grok is telling me no. It’s telling me the first public promotion was “earn to give” by some employees in 2012.
I am more confident in the 50% success rate in the pre-2010 timeline. I think this sub is smart enough that a high percentage of the posters could make money in the pre-automation days. Floor trading days - yes. Early electronic days but before heavy automation - probably yes. Today maybe we could get to 50% deploying people in trading niche.
Interesting take. Cheers.
It seems like you think the motte has a major weighting towards that top 1% of prospective applicants, which is where you're getting your intuition from.
Frankly I find it hard to disagree. If i read 100 comments on reddit on a given issue, probably 99 of them are totally retarded and incapable of demonstrating rational thought. If I read 100 comments on the motte, every second one is at least somewhat sensible.
More options
Context Copy link
More options
Context Copy link
More options
Context Copy link
More options
Context Copy link
More options
Context Copy link
More options
Context Copy link
More options
Context Copy link
More options
Context Copy link