Hits and Misses

by John Quiggin on May 29, 2019

Looking back at past posts, it’s enjoyable to find those where I went out on a limb and have been proved right by events, or at least supported by subsequent evidence. A couple of examples

It’s less fun when things don’t go as expected. Take Bitcoin as an example. Its uselessness is now even clearer than it was when I started writing about it 2013. Use in legitimate market transactions is almost non-existent, while the darknet illegal markets in which it is the preferred currency are being busted so frequently as to suggest that anyone using them is taking a big risk of losing their money, or worse. Meanwhile, the dream that Bitcoin would justify itself through the magic of blockchain has evaporated. As far as I can tell, cryptocurrencies on the Bitcoin model are the only genuine examples of blockchain technology in actual use (the label has been attached to some other projects for marketing purposes.

I’ve always said that, given the irrationality of markets, no one can predict when Bitcoin will reach its true value of zero, and I was careful to maintain this position when I posted on Bitcoin’s decline below $4000 late last year. Still, I have to admit that I expected this mania finally to come to an end. That hasn’t happened; in fact the price has doubled.

I won’t worry too much about the occasional (or not so occasional) error. My track record is still far better than that of the many pundits who predicted success for the Iraq war and continued claiming imminent victory years after the disaster had become evident. And most of them are still in business, apparently just as credible as ever to their audiences.

{ 28 comments }

1

christian h. 05.29.19 at 8:37 am

Self driving cars for all the bad drivers. Granted you demanded that only 15 months ago and GM still has six months to mass produce those fully autonomous no steering wheel cars, but I’d be interested if you’ve adjusted your take? I’m as negative on the technology and sociology of the things as ever, if not more so.

2

John Quiggin 05.29.19 at 10:40 am

“GM, is releasing a fleet of self-driving Chevy Bolts this year. These Chevy Bolts have no steering wheels, pedals, or speedometers, and they mark a confident step toward driverless cars”

So, I don’t think I was way off about the technology

https://www.howtogeek.com/405158/when-can-i-buy-a-self-driving-car/

OTOH, from the same article “Level 5 autonomous cars need to outperform humans at every turn, stop, and wild act of God before lawmakers will allow them on our streets. “

Obviously, society is more worried about one death caused by a robot than about 100 deaths caused by drunken incompetents, but I didn’t have any expectation that my policy proposal would be accepted.

3

Timothy Scriven 05.29.19 at 11:53 am

I’m toying with the idea that maybe Bitcoin will remain afloat nearly indefinitely because there is a niche for a gambling activity shaped like Bitcoin*, and economies of scale and advantages to established products in that niche mean that it’s nearly impossible for the existing dominant player to be dislodged.

*A gambling activity tied into the following themes/aspects: futurism, libertarianism, allowing insiders to feel like they understand something very important outsiders don’t, edginess. As bitcoin has shown, these things have a natural synergy, and appeal to gamblers who wish to think of themselves as something more serious than gamblers.

4

Scott P. 05.29.19 at 2:22 pm

“GM, is releasing a fleet of self-driving Chevy Bolts this year. These Chevy Bolts have no steering wheels, pedals, or speedometers, and they mark a confident step toward driverless cars”

I’ll believe it when I see it.

5

Hidari 05.29.19 at 4:01 pm

I hide behind a pseudonym, and in any case, have no professional standing in economics, so have nothing to lose by saying this. So I’ll say it.

‘I’ve always said that, given the irrationality of markets, no one can predict when Bitcoin will reach its true value of zero,’

FWIW (probably nothing) I don’t agree with this, mainly because I have literally have no idea what phrase “the true value of a currency” might possibly mean. If people believe Bitcoin is worth something, it’s worth something: if they don’t, it’s not. QED.

I am perfectly aware of the logical arguments against Bitcoin, and accept them to a greater or lesser extent. I just have an intuition that they are wrong, and that we are all missing something. But I couldn’t say what. But FWIW (again, probably nothing) I think Bitcoin and other crypto-currencies will probably be around for a lot longer than people think: decades, not years.

6

Aardvark Cheeselog 05.29.19 at 6:30 pm

And most of them are still in business, apparently just as credible as ever to their audiences.

Audiences for punditry can remain irrational longer than you can remain patient.

7

Harry 05.29.19 at 8:12 pm

“My track record is still far better than that of the many pundits who predicted success for the Iraq war and continued claiming imminent victory years after the disaster had become evident.”

Not a high standard to hold yourself to John!

8

christian h. 05.29.19 at 9:41 pm

If you follow the link that the article you refer to gives as evidence for “GM is releasing …” you will notice that it links to a CNBC piece of 12 January 2018. Based on the very same GM press release referenced in your blog post more than a year ago. Don’t you find it curious that since that day 15 months ago there hasn’t been any update on progress by GM? No new release saying “now is the time”?

9

Cranky Observer 05.29.19 at 11:06 pm

= = = “GM, is releasing a fleet of self-driving Chevy Bolts this year. These Chevy Bolts have no steering wheels, pedals, or speedometers, and they mark a confident step toward driverless cars” = = =

I have a Chevy Volt, the big sister of the Bolt, with all the latest driver assist bells and whistles. It is a great car and the driver assist is already helping me to drive at a higher level of safety as I start down the long slide to Death(tm). But the technology is at least 20, and probably 50, years away from full self driving.

10

John Quiggin 05.30.19 at 12:47 am

Christian @8 Good catch! But GM is still claiming to be on track http://gmauthority.com/blog/2019/05/cruise-automation-plans-still-on-track-updates-inbound-gm-says/

and it appears that the primary obstacle is regulation rather than technology

https://leftlanenews.com/chevrolet/8518042791558614588/

11

Gabriel 05.30.19 at 4:28 am

TLDR: Game recognize game, Krauthammer, and you ain’t got none.

12

christian h. 05.30.19 at 6:47 am

JQ @10: Thanks! I googled around but somehow didn’t find that update – bad google skills clearly.

13

Cian 05.30.19 at 12:46 pm

John – a couple of responses on the GM car thing.

First of all – why do we believe the GM PR department when they say the technology is on track? Particularly when other company’s (including companies who have a track record here, such as BMW and Volvo) have failed to deliver?

Secondly, regulation here seems to be the insurance industry objecting to an untested technology with no safety statistics being released onto the roads. Which is a completely reasonable objection, and rather begs the question why haven’t GM subjected this technology to independent testing.

Which rather leads me to a good reason to be skeptical of all this technology. None of it has been independently tested. All we have are the heady claims of companies doing R&D in this area. You’re a finance guy – I’m guessing you’re familiar with the phrase “talking one’s book”.

AI is notorious for being an industry where the solution is perpetually 5 years away. Not sure why autonomous cars would be any different honestly.

14

Lee A. Arnold 05.30.19 at 7:42 pm

I second Timothy Scriven at #3. Cryptocurrency is a place to speculate that others will jump in and inflate prices too because the world is awash with stupid “surplus savings” looking for quick returns. This creates “value” in the minds of more than a few clods, as long as you aren’t the last one holding the crap. It could go on for a long time.

Touting my own “hits”, I predicted about 12 years ago (in these very comment threads) that the US Republicans would crack in half, because they are on a self-canceling crash-course with reality, engineered (in this era) by Reagan’s false teaching that government can get smaller.

Around 5 years ago I named Trump (in these very threads) as a possible opportunist/parasite/freeloader who might insert himself into the GOP breach into functional incoherence.

Then two years ago I noted (also in these threads) that the FBI probably freaked out at the Trump campaign’s contacts with Russians because they knew he had been rubbing elbows with the Russian mob for a decade or two, and they know that Putin is the capo di tutti capi who possibly holds compromising info on him, and now, there appeared to be evidence that his campaign coordinated with the Russians to win the election.

Now we learn from the Mueller Report, (putting it in a nutshell if you haven’t read it,) that: 1. They found some evidence of CONSPIRACY, but could not access other existing evidence to look at it further; and 2. they found enough evidence to win a case on OBSTRUCTION. But, for either case, Mueller’s charging decision would follow the Justice Dept. rule that only Congress can deal with the bad actions and crimes of a President. So, Mueller has flipped it to Congress.

I now predict that, as this seeps into the blockheaded crania of the American booboisie, the Senate GOP has already realized that their best chance of keeping the WH in 2020 is by dumping Trump, and going with Pence, even if possibly knocking Pence off in the primaries. (Of course Pence would be happy to kiss their butts while he preaches “Keep Trumpism Alive” for the base voters.) Maybe the GOP knows it already — and they are secretly waiting, to vote to convict on impeachment?

Pelosi is probably right to try to wind it out in various committees, perhaps to find other high crimes and misdemeanors that were outside Mueller’s purview. But events may overtake her strategy. Mueller’s on-camera press statement yesterday reaffirmed that his report is a referral to impeachment, and now there are a slowly increasing number of Republicans who say, Dump the guy!

15

NomadUK 05.30.19 at 8:10 pm

https://www.eschatonblog.com/2019/05/your-kids.html

You don’t have to be as pessimistic as I am about the current and future state of self-driving car technology to agree with the idea (as almost everybody in the field does!) that what they call level 2 and level 3 technologies – basically self-driving kinda works but you still have to be paying attention 100% just in case – are extremely dangerous. I think it’s worse than has usually been written about, in that the issue isn’t just that drivers are unlikely to maintain 100% attention as they should, it’s also that even a 100% alert driver is never going to be quite sure when s/he is going to have to “fight” the autopilot. At 65 MPH, at what point are you supposed to realize it’s about to kill you or someone else? This is an impossible task, even for that 100% alert driver.

16

John Quiggin 05.30.19 at 11:36 pm

@NomadUK I agree, there’s a gap that has to be leapt between moderate assistance and full automation, and that’s a big problem. OTOH, with reference to my post that started this, note the implicit assumption that drivers of level 0 cars are paying 100 per attention. That’s never been true, and the technological innovation of mobile phones (and particularly text) has made things even worse. I’d far rather the oncoming car on the highway be driven by a fallible robot than by someone texting their friends as they drive.

More generally, I think the 15 months since I first posted hasn’t produced enough evidence to shift views much, one way or the other. If you saw striking progress then, that’s still the case, and similarly if you saw vaporware.

17

hix 05.31.19 at 3:31 am

The better question would be “when can i get a robot taxi”. Which is alright too. The first level 5 cars will not be a software updates for cheap assistance level hardware.

18

nastwoman 05.31.19 at 4:29 am

”It’s less fun when things don’t go as expected”.

I never expected that my homeland could be clowned back so far.

19

Hidari 05.31.19 at 5:54 am

@`4

‘I now predict that, as this seeps into the blockheaded crania of the American booboisie, the Senate GOP has already realized that their best chance of keeping the WH in 2020 is by dumping Trump, and going with Pence, even if possibly knocking Pence off in the primaries’.

My counterprediction is that this will not happen.

20

Feliquid 05.31.19 at 9:09 am

you might wish to hear about Imogen Heap’s use of blockchain to ensure all musicians that work on a piece of music get paid appropriately:

https://www.forbes.com/sites/paularmstrongtech/2018/07/05/imogen-heap-talks-mycelia-mi-mu-gloves-and-creative-passport-blockchain-project/

21

Cian 05.31.19 at 1:37 pm

@Feliquid – do you have any links that explain how this platform is going to solve any of these problems?

22

Cian 05.31.19 at 2:03 pm

More generally, I think the 15 months since I first posted hasn’t produced enough evidence to shift views much, one way or the other. If you saw striking progress then, that’s still the case, and similarly if you saw vaporware.

Well no what I saw was a lot of R&D lab demos (I’ve seen a lot over the years – most don’t result in anything much), and companies repeatedly miss their deadlines.

Even if one believes that autonomous cars will eventually happen (I’m neutral – though I’m pretty skeptical about the current approach given that it’s never succeeded previously), your timelines seem very ambitious. Even if GM make their deadline – all that means is that they’re testing a bunch of cars that may, or may not, work. Nothing’s being commercialised.

23

Hidari 05.31.19 at 6:25 pm

I would have thought that Professor Quiggin’s proudest prediction would have been his prediction that the ‘golden age’ of (manned) space travel is over, and that, indeed, the Golden Age of all forms of (carbon-fuelled) transport is over.

Did anyone watch the news about the A380? The largest passenger plane ever built, and, of course the overwhelming probability is that it is the largest (oil fuelled) passenger plane that will ever be built. Mothballed decades ‘before its time’ and another sign that the ‘age of flight’ is winding down. (History will record the end of Concorde and the end of the A380 as the first signs that the flying party was reaching its inevitable conclusion, just as the end of the Space Shuttle indicated that the Space Age was coming to an end).

24

John Quiggin 06.01.19 at 9:28 am

Cian ” a lot of R&D lab demos … and companies repeatedly miss their deadlines. ” Isn’t that the textbook definition of vaporware?

Hidari, I’m certainly standing by my predictions there, though with plenty of regrets about being right. I love SF and the A380 was (still is, I suppose) a great plane.

25

David J. Littleboy 06.01.19 at 3:50 pm

It’d be real nice if the age of flight were winding down, but passenger miles flown have been up 5 to 8% every year for the last 10 years (the 2007/2008 recession took a bite out of said growth for two years, but it was back up immediately after), China is building over 100 new airports. The insanity remains in full force.

FWIW, as an ex-AI type (all-but-thesis, 1984), the whole self-driving car thing looks to me to be more hype than content. “Neural net” image recognition is quite fragile (easily fooled* e.g. can’t recognize cows on a beach since there’s no green), “neural nets” have no similarities to neurons whatsoever (really, they don’t**). There are probably some technological kludges that can be implemented to prevent some classes of accident (cell phone monitor that forces the driver to pull over to make a call), and these will be good things that save lives, but they won’t be AI, they’ll be ad-hoc kludges.

*: Gary Marcus discusses this. More generally, kids at a young age, long before they learn language, learn the concept of “physical object”. Watch a parent playing “peek-a-boo” with their kid. Kids figure out that physical objects actually exist real early. Current AI systems don’t/can’t do that (they can’t recognize objects*** rotated more than a few degrees, e.g. can’t recognize an upside down school bus). We AI types failed miserably at figuring out how to make the computer do anything that even vaguely looked like “reasoning”, and retreated to ad hoc kludges. There’s no “I” in AI. (My basic view of AI is that human intelligence is seriously amazing, we aren’t anywhere close, and we’re not even trying.)
**: This was covered in an article in Science recently. It’s not a secret. Real neurons in real mammalian brains are extensive in space (long projections), have large numbers of inputs (7,000 on average), and compute logic functions of subsets of their inputs. “Neural nets” are layered, locally connected (4 to 10 inputs) arrays of computing elements, and deal with weights and averages, not logic. Completely different beasts.

***: This is subtle: neural nets have no way of representing or talking about “objects” at all. They are pure pattern recognition systems, with nothing higher level than that. It sometimes looks as though they are “recognizing objects”, but they’re not.

26

Bruce Baugh 06.02.19 at 2:04 am

I’ve just realized that cryptocurrencies are financial block holes, in an almost literal way. They distort local spacetime and periodically suck in matter, including both attention and amounts of more viable concerns. They have their own Hawking radiation, in which random events near their event horizons turn virtual loot into small quantities of real loot. Such events gradually dissolve the cryptocurrency, and in the end they explode in a shower of matter and radiation, with nothing left.

27

derrida derider 06.02.19 at 9:47 am

That’s a funny way of looking at the A380, Hidari. The A380 failed because smaller cheaper planes achieved just as much range, plus Boeing got their tame regulator to make a change that favours those smaller planes (ETOPS – the distance a twin engined plane is allowed to be away from the nearest airport in case an engine fails – is now up to 7 hours, where once it was deemed dangerous for them to be more than 40 minutes away).

The result is that there are a lot more point-to-point flights to relatively minor airports, at the direct expense of the big planes doing hub-and-spoke. Which has meant far MORE planes doing long hauls and burning, net, more fuel in total. For better or worse it doesn’t look like the end of the flying age at all.

28

Cian 06.02.19 at 9:43 pm

Vaporware is typically when a company announces a product that is never released.

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