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satt comments on Open thread, Aug. 17 - Aug. 23, 2015 - Less Wrong Discussion

3 Post author: MrMind 17 August 2015 07:05AM

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Comment author: skeptical_lurker 20 August 2015 06:48:41PM *  1 point [-]

A side note, but my immediate reaction to reading that was "that's overconfidence", though it's quite possible I'm interpreting "financial crash" more grandly than you intended. If I define it — just to try to be more concrete, albeit still pretty fuzzy — as an event as bad as the 2007-8 financial crisis, I'd put a probability ≈5% on that happening by 2015's end.

I'm basically claiming that I know better than the market, so I'm surprised you're the first person to call me on it. Rigorous definitions are complicated by the fact that the 2007-8 financial crisis took about a year to bottom out - even if the next crash started right now, it (probably) wouldn't bottom out by the end of the year. I'd say around 50% prob of a crash of similar impact as 2008 starting by the end of the year. Perhaps I should get a predictionbook account and register my unusual predictions.

Yes, predictions about nationalism/communism are simple extrapolations. I wish to emphasise that I don't think this is necessary a disaster - the SNP are not your stereotypical nationalists, and are not a huge source of concern IMO, and Japan is an ethno-nationalist state which seems to be functioning perfectly fine.

I do find it surprising/worrying that the frontrunner for the leader of the opposition in the UK is a socialist talking about encouraging growth by printing money, leaving NATO, funding homoeopathy, legislating against toy soldiers, etc., and is mostly rejected by his own party for being too left-wing.

Comment author: satt 21 August 2015 03:02:19AM *  0 points [-]

I'm basically claiming that I know better than the market, so I'm surprised you're the first person to call me on it.

To be fair, I didn't look at the markets either. I asked my gut for a reference class forecast ("How often might I expect this kind of crisis to come along in general...?") while trying to remember my impressions of what economic commentators have said about potential bubbles & such. (I used this sort of tactic to guess rough, first-cut probability estimates in the Good Judgment Project, where I did OK.)

Rigorous definitions are complicated by the fact that the 2007-8 financial crisis took about a year to bottom out - even if the next crash started right now, it (probably) wouldn't bottom out by the end of the year.

Yeah, that was part of the reason my probability was as low as it was. Actually, reflecting on it a tiny bit more rigorously, I'll nudge it down further to maybe 3%, because I originally rounded "before the end of the year" to "half a year" in my head, but the rest of 2015 is more like a third of a year.

I'd say around 50% prob of a crash of similar impact as 2008 starting by the end of the year.

With a looser prediction window like "beginning by the end of 2015, but hitting bottom before the end of 2016", I'd raise my "maybe 3%" to "maybe 12%".

a socialist talking about [...] legislating against toy soldiers

I had to Google that one!

Edit to add: regardless of the probability disagreement, I did upvote you for elaborating.