Are you good at predicting the future?
When Cazenove was founded 200 years ago, few could have anticipated the world we live in today. We asked two futurologists about what the future might look like – and how we can all become better forecasters.
From the wild to the mundane, there are countless historic predictions about where we might be today that have not come true. Just a few examples include: flying cars, technology leading to the end of work as we know it and colonising other planets. “Bladerunner”, the 1982 science fiction film depicts a dystopian future in which humans are pitted against bioengineered humanoids… in 2019.
While it’s easy to look back and laugh, it’s important to remember that anticipating the future is a difficult and uncertain task. Many factors can influence the course of history. With this in mind, I spoke to two futurologists about what the future might hold.
Kate Ancketill, CEO and Founder of business futurist consultancy GDR, anticipates that decarbonisation technologies will continue to shape our lives as we need to find alternative energy sources. Medical self-diagnostic tools are likely to revolutionise healthcare as wearables and implanted devices become more sophisticated and tools that analyse a patient’s DNA to detect genetic predispositions become more advanced. Kate also predicts that AI deepfake technology – requiring new levels of security and authentication – will all have a big impact on the way we live and work in the future. AI tools, like ChatGPT, will also be hugely influential.
Inaccurate predictions can help you figure out the future
Warren Hatch, CEO of forecasting agency, Good Judgment, says that looking at why your predictions haven’t materialised is an integral part of forecasting. Warren is known as a “super forecaster” – typically distinguished from a regular forecaster by their ability to make more accurate predictions over a sustained period of time. He recommends always noting down predictions with commentary on your rationale. When you reach that future point in time, you can look back and you can see whether you missed something along the way.
One area that has progressed more slowly than anticipated has been the metaverse. “The ideas and vision are there – and there have been some great experiments in the last year,” notes Kate. But in this case, the technology to support and process the ideas haven’t been there. “When the tech catches up I expect big things. I’d give it another five years for the western world to really see the benefit,” Kate explains.
Warren takes the 18th-Century prediction that we would have flying cars by the 20th Century. “Perhaps they were being fanciful and it would be interesting to see their rationale for that prediction,” says Warren. He notes that we do have drones and helicopters so it may not be as far off as it first sounds.
What does history tell us?
Another important element of forecasting is looking at what history can tell us about similar scenarios. “Start by looking for events in history that have similarities to what you’re considering today,” he says. Taking climate change as an example, Warren says: “One of the things of history tells us is that when groups of people get together and decide to do something, the odds are good that they achieve what they’re setting out to do.” If we look back to just five years ago, Warren says that if he had set signpost questions to gauge whether we were on track to reduce carbon, we are hitting a lot of those today.
Convert your gut feelings into numbers
The accuracy of an investor’s predictions can have a huge impact on their portfolio. It is therefore important to keep a track record of your accuracy, says Warren. “You can convert your gut feelings and hunches into numbers.” Investors shouldn’t simply say, “I’ve got a good feeling about this stock”. They need to ask what that good feeling is, he argues. “Convert the hunch into a probability and provide a reason for it. Has it got an 80% probability of it outperforming the index this year? Then write down your rationale for this and come back to it in a year,” says Warren. If you do this with all of your forecasts, you can then work out the frequency at which your predictions are accurate, enabling you to make informed decisions about the precision of your instincts.
The future, according to AI
We asked ChatGPT to predict the next 200 years. ChatGPT is an AI tool that uses natural language processing to generate human-like responses to user queries. It takes information from across the internet. It pulled out four key areas for change. These include the impact of artificial intelligence, communications technology, demographic shifts and the future of space travel.
Advancements in communications technology are likely to enhance productivity as it will become easier to work with people across the world. “In the future, we may see new forms of communication emerge that we can’t even imagine today,” ChatGPT wrote. “It’s possible that we could develop the ability to communicate telepathically, or that we could use advanced virtual reality technology to communicate with others in a more immersive way.”
ChatGPT also predicted that space travel could have a significant impact on human civilisation in the next 200 years, including through exploration, colonisation, resource extraction and defence and security. “As space travel technology advances, it may become possible to use space-based technologies for defence and security purposes. For example, it may be possible to develop space-based weapons or use space-based surveillance technologies to monitor potential threats to national security.”
The AI software also wrote about the ethical and social implications of new technologies. It said there was a need for “policymakers and society as a whole to think carefully about how we want to shape the future, and to ensure that these changes benefit everyone, not just a select few”.
References to individual companies are not investment recommendations.
This article is issued by Cazenove Capital which is part of the Schroders Group and a trading name of Schroder & Co. Limited, 1 London Wall Place, London EC2Y 5AU. Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority.
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