You would expect those who predict the future to be right in their forecasts but the simple observation of Daniel Kahneman is that they make many errors, not because the world is unpredictable, but because high subjective confidence is not to be trusted as an indicator of accuracy. “Remove one highly assertive member from a group of eight candidates and everyone else's personalities will appear to change. Let a sniper's bullet move by a few centimetres and the performance of an officer will be transformed,” he writes in ‘Thinking, Fast and Slow' (

You should expect little or nothing from Wall Street stock pickers who hope to be more accurate than the market in predicting the future of prices, and you should not expect much from pundits making long-term forecasts, although they may have valuable insights into the near future, advises the author. For, ‘the line that separates the possibly predictable future from the unpredictable distant future is yet to be drawn.'

Posing the question, why do investors, both amateur and professional, stubbornly believe that they can do better than the market, the author finds ‘the most potent psychological cause of the illusion' in the fact that the people who pick stocks are exercising high-level skills.

Educative study for a contemplative afternoon.