Polling guru Nate Silver: forecasters are wasting their time

Decisions: Nate Silver, US Statistician, pollster and poker player, on why it's impossible to predict GDP rates - and why he's sticking to politics.

by Rebecca Burn-Callander
Last Updated: 19 Aug 2013

Nate Silver made a name for himself by correctly forecasting baseball games and successfully predicting the result of the 2012 US elections in all 50 states.

In 2008 he established his own website, fivethirtyeight.com, and correctly predicted the results of the primaries and the presidential winner in 49 states during the 2008 presidential election.  

Silver's book, The Signal and the Noise, was published in September 2012.

He explains his best and worst decisions in business.


 

MY BEST DECISIONS...

 

The smartest choice I ever made was to stay away from economic forecasting. It's a no-win career, a dead end. The reason why your Bank of England governor will always be cagey about predicting GDP rates in six months is because it's impossible to see more than two months in advance. That's why macroeconomic forecasters have a terrible track record.

However, in politics you just have to have a decent model and do your research and you can be a stand-out statistician. I like medium complexity - enough data to work on and experiment with but not so much that everybody's done it a million times before.

That's why my next move will probably be into retail and logistics, using the data that companies like Walmart collect to create pricing strategies and manage inventory. If the price of corn suddenly rises, how will that affect price and the consumer's mindset and behaviour? That's the kind of data that companies are desperate to get their hands on.

Also, deciding not to play poker as much was probably wise - I used to make a living playing online in the early 2000s. Back then I was much better than everyone else but being good at statistics isn't enough now.

There are 16 year-olds out there who are truly gifted. I play in the occasional tournament but it's not the passion it was.

MY WORST DECISIONS ...

 

Going on Twitter has been challenging. People really don't like hearing that their favourite political candidate is going to lose. Hardcore political junkies in the US tend to be extremely partisan, very passionate for one side or other.

They don't like it when you point out the obvious. When Obama was the clear favourite, there were a lot of people who didn't like me talking about that. They attack the messenger rather than the technology.

Political forecasting has been my bread and butter for the past few years so I can't regret my decision to get into the business, but I'm definitely tiring of it. The industry appeals to a lot of sociopaths and crazy people. And I don't like the fact that in politics telling the truth is seen as optional.

I also wish that I had never taken a boring KPMG consulting job straight out of college. I wasted a lot of time being miserable in my professional career, and the difference in your quality of life when you pursue what you love is amazing.

Writing a book was one of the toughest decisions I've ever made professionally, but one of the best too. With blogging, you get instant gratification but it means you never step back and get a proper perspective on your argument. With books, you have to fill in the detail.

Nate Silver was the keynote speaker at the LiNC 'future of social' conference in San Francisco.

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