Accurate prediction and the speed of light
This is the time of year when you see lots of baseball prediction stuff ... how many games teams will win, who will finish in first place, how the post-season brackets will go, and so on.
And I hate them, when they're taken seriously. Because, predicting outcomes with a high degree of accuracy is impossible. All you can do is guess at the basic probabilities. After that, it's all luck.
Suppose that you're able to figure that a certain team -- Milwaukee, say -- is actually a .500 team in terms of talent. Obviously, there's going to be a certain amount of error in your assessment, since it's impossible to know for sure -- but, for the sake of argument, let's say you just know.
Then, subject to certain nitpicks (which I'll leave in the comments), you can consider the Brewers season like 162 coin tosses. The most likely outcome is 81 heads and 81 tails, but it's probably going to be different just because of luck. Statistically, you can calculate that the standard error is around 6.4 wins. That means that, around 1/3 of the time, your estimate will be off by more than around 6.4 wins either way. And, around 1/20 of the time, your estimate will be off by more than 12.8 wins.
Suppose that, being rational, you predict 81-81. And, at the end of the season, the Brewers indeed wound up 81-81. You're a hero! But, you were lucky. The chance that an average team will go exactly 81-81 is ... well, I'm too lazy to calculate it, so I simulated it, and it's around 6.3 percent. You hit a 15:1 longshot.
Basically, it's like a law of nature that it is impossible to regularly forecast team records with a margin of error of fewer than around 6.4 wins. Not difficult, but *impossible*. It's impossible in the same sense as constructing a perpetual motion machine is impossible, or turning lead into gold on your kitchen stove is impossible, or accurately determining the temperature 100 years from today at 4:33 pm is impossible. No matter how much you know about the team, and the players, and the second baseman's diet, and the third baseman's mental state, and whether the right fielder is on PEDs ... the best you can do, in the long run, is a standard error of around 6.4 wins.
When forecasters have a contest, and after the season, one of them has "won" with, a standard error of, say, 4.9 wins ... well, you may be impressed. But he was certainly at least partly lucky. He beat the natural limit of 6.4. He was better than perfect. You may think you're praising his forecasting acumen, but, really, you're implicitly praising his ability to influence coin tosses.
As far as I'm concerned, this feature of randomness -- the existence of a "speed of light" limit to accuracy -- is so fundamental that it should be called "The First Law of Forecasting," or something. There is a natural limit that cannot be breached, and it usually comes much sooner than we expect.
The newspapers are full of writers, and pundits, that ignore this law, not just in sports, but in everything. They assume that if you're smart enough, and expert enough, you can accurately predict who's going to win tomorrow's game, or what the Dow-Jones average will be next year, or what's going to happen in North Korea.
But you can't.