Blog post by Morgan Housel: “During the Vietnam War Secretary of Defense Robert McNamara tracked every combat statistic he could, creating a mountain of analytics and predictions to guide the war’s strategy.
Edward Lansdale, head of special operations at the Pentagon, once looked at McNamara’s statistics and told him something was missing.
“What?” McNamara asked.
“The feelings of the Vietnamese people,” Landsdale said.
That’s not the kind of thing a statistician pays attention to. But, boy, did it matter.
I believe in prediction. I think you have to in order to get out of bed in the morning.
But prediction is hard. Either you know that or you’re in denial about it.
A lot of the reason it’s hard is because the visible stuff that happens in the world is a small fraction of the hidden stuff that goes on inside people’s heads. The former is easy to overanalyze; the latter is easy to ignore.
This report describes 12 common flaws, errors, and misadventures that occur in people’s heads when predictions are made….(More)”.