Exploring the boundaries of predictability: what can we forecast, and when should we give up?

26 June 2015

Yahoo Big Thinkers

Sunnyvale, California

Friday 26 June 2015, 3:00-4:00 pm Location: Yahoo Sunnyvale Campus and LIVE at labs.yahoo.com

Why is it that we can accurately forecast a solar eclipse in 1000 years time, but we have no idea whether Yahoo’s stock price will rise or fall tomorrow? Or why can we forecast electricity consumption next week with remarkable precision, but we cannot forecast exchange rate fluctuations in the next hour?

In this talk, I will discuss the conditions we need for predictability, how to measure the uncertainty of predictions, and the consequences of thinking we can predict something more accurately than we can.

I will draw on my experiences in forecasting Australia’s health budget for the next few years, in developing forecasting models for peak electricity demand in 20 years time, and in identifying unpredictable activity on Yahoo’s mail servers.

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