Magazine article Foreign Policy

More of the Same: What Will the World Look like Tomorrow? A Lot like It Does Today

Magazine article Foreign Policy

More of the Same: What Will the World Look like Tomorrow? A Lot like It Does Today

Article excerpt

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Never underestimate the predictive power of inertia. To wit: It's a safe bet that Israeli-Palestinian relations will continue to fester; Pakistan will still be the tinderbox of tomorrow; and the United States will be highly indebted yet remain among the world's most prosperous countries.

The world is of course full of tumult, upheaval, and sudden change, but these shifts are extremely hard to predict. If pinpointing when and where the next revolution will appear is a task for sages, separating the wise men from the fools is a fool's game in itself: In a sea of predictions, it's hard to really know who really knows what's just around the corner.

Of course, some prognosticators occasionally turn out to be correct. Does that mean you should trust their next prediction? In this sense, picking one's prophet bears some similarity to trying to find a high-performing mutual fund manager. Every year, one in a hundred fund managers are, by definition, in the top 1 percent. They're celebrated as investment gurus; their funds swell in size. Yet there's little evidence of any persistence in fund returns--next year, these top managers are back in the middle of the pack. High-performing fund managers are, for the most part, lucky, not smart.

It's similarly difficult to separate the wheat from the chaff in the fortunetelling market. After the fact, the lucky ones look like geniuses, and their predictions seem obvious--we're all scratching our heads wondering why we didn't see the housing bubble or the global financial meltdown coming. …

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