#impact-probability

#impact-probability

An email was sent to White House staff on 24 March, warning them against using insider information to place bets on prediction markets like Kalshi or Polymarket.

"Gambling on the weather has become an institution throughout a great part of the United States." This sentiment from the Fort Worth Star-Telegram in 1915 highlights the long-standing tradition of weather betting in American culture.

Pi is an infinitely long decimal number that never repeats. How do we know? Well, humans have calculated it to 314 trillion decimal places and didn't reach the end. At that point, I'm inclined to accept it. I mean, NASA uses only the first 15 decimal places for navigating spacecraft, and that's more than enough for earthly applications.

While humans have assembled a lot of weather data, flash floods are too short-lived and localized to be measured comprehensively, the way the temperature or even river flows are monitored over time. That data gap means that deep learning models, which are increasingly capable of forecasting the weather, aren't able to predict flash floods.

“fireball burning everything in its path”

Weather impacts sales. Every retailer knows it. But for most, the likelihood that it might rain, snow, or sleet on the third of March somewhere in the Midwest is rarely used. Vendors such as Weather Trends have offered accurate, long-range forecasts for more than 20 years. But the opportunity is not predicting the weather; it's knowing what to do with the data. AI might change that.

When discussing their results, they tell us that Facebook's reporting or Google Analytics show the ad campaigns as barely breaking even. Yet they keep investing in this channel. They reason that Facebook can only see a fraction of the sales, so if Facebook is reporting a 1x return on ad spend (ROAS) then it's probably at least 2x in reality.

AI was everywhere, but I wasn't focused on product launches. I was looking at how companies think about data itself: how it's shared, governed and ultimately turned into decisions. And across conversations with executives and sessions on security and compliance, a pattern emerged: the technical limitations that once justified locking data down have largely been solved. What remains difficult is human. Alignment, trust and confidence inside organizations are now the true barriers.

We're seeing more frequent, more severe extreme weather events and that inevitably affects claims and affects pricing it can't not. And this is happening all over the globe. More, after this week's most important reads.

On October 1, 2022, something strange happened in the Philippines: 433 people won the jackpot in the local lottery. For this particular lotto, six numbers ranging in value from 1 to 55 were randomly selected, and the 433 winners all matched. Even more bizarre, when arranged in ascending order, the winning numbers were: 9, 18, 27, 36, 45 and 54. In other words, the winning numbers were multiples of 9 (9 1, 9 2, 9 3, etcetera).

Our view is that large-language model digital agents can effectively do a non-immaterial portion of the work currently provided by 20-30k independent agents across the United States. The core of the firm's bearish thesis centers on a massive pool of routine, low-complexity insurance policies.

Data science and artificial intelligence are fundamentally redefining what constitutes skill in investment management, shifting the sources of sustainable competitive advantage in ways most firms have yet to comprehend. This is not about automating existing workflows. It is about reconceptualizing which analytical tasks can be systematized and which genuinely require human judgment, then rebuilding investment processes around that distinction. Firms that fail to recognize this depth are not simply adopting tools more slowly. They are misunderstanding the nature of the change itself.

I am a worrier, and have been for most of my life. At some point, someone dear and smart teased me that I worry about the wrong things. The things that hit me, she noted, were never the things I worried about. For a while that left me feeling like an incompetent worrier-until my research caught up. I realized that the things I worry about often don't end up hurting me precisely because worrying helps me diffuse them ahead of time.

Time pressure, limited information, confusion, fatigue, and mortality salience combine to set the stage for decision-making errors, sometimes with grave consequences. An example is the downing of Iran Air Flight 655 by a missile launched by the USS Vincennes in 1988, resulting in the death of 290 passengers and crew. In a time of heightened tension between the U.S. and Iran, the captain of the Vincennes misidentified the airliner as an incoming hostile aircraft and ordered his crew to shoot it down.

A new study analyzing data from 1990 to 2023 found that AI can predict 71% of mutual fund managers' trade directions. The research suggests that thousands of high-paying finance jobs could become automated. The study, published by the National Bureau of Economic Research, looked at the $54 trillion asset management industry and discovered that senior managers in less competitive categories are the most predictable-and thus the most replaceable.