There are three things in the past decade that I am not only wrong once about, but actively being wrong while the situation is evolving. Introspecting how that happened would serve as a useful guide for the future.
Cryptocurrencies
I’ve been exposed to cryptocurrencies, particularly Bitcoin pretty early on, somewhere around 2009 on Hacker News. I’ve run the software at that time (weirdly, on a Windows machine). However, the idea of Austria-doctrine based currency sounded absurd to me. If you cannot control the money supply, how do you reward productivity improvements? Not to mention it also sounded otherworldly this is going to fly with regulators with its money-laundry potential.
Fast-forward today, these concerns are all true, but it doesn’t matter.
Covid-19
One day in February 2020, when walking with a friend, I told him that I thought the Covid-19 was almost over: CDC didn’t report any new cases for a couple of weeks, it all seemed under-control. In March 2020, everything seemed real, but I was optimistic: the worst-case, that is, we didn’t do a damn thing, this thing probably was going to fade away in a year or two. Given that we were doing something, probably a couple of months at most?
Fast-forward today, the end is near after 2 and half years. But the world is not functioning as it was before.
2022 Russian Invasion of Ukraine
Feb 22th, 2022, after Putin announced his recognition of Donetsk and Luhansk as independent regions, I told a friend: it was probably the end of the 8-year war, now there would be a long political battle for Ukrainians.
Fast-forward only 8 days later, we are on the verge of World War 3.
What’s wrong? Why at that time, I seemed unable to grasp the significance of these events even when everything was presented?
For a very long time (really, since I was twelve), I loved to read non-fictions. Unsurprisingly, many of these non-fictions discussed people, companies or events that happened in modern times. These books helped me to shape my world views. They also turned out to be very helpful to predict near-future events.
However, non-fictions presents a very short slice of modern history. A snapshot is static. With many of these snapshots, a static world view was built. A static world view is great locally: easy to understand, and easy to predict. But it is terrible for once-in-a-life-time events.
Equipped with modern economics theory, it is easy to see why cryptocurrencies cannot work. But if history is any guide, this is simply a different group of bankers trying to issue private money again. A fixed-supply system indeed worked a hundred years ago prior to WW1. Many central banks who control our money-supply today were privately-owned a century ago. Cryptocurrency folks will try to be the new central banks of our time. They might fail. But at that point, it is less about sound economics theory, but more about politics and excitement. The device itself can be modified to fit whatever utilities and theories we see suit.
A pandemic is not a linear event. No, I am not talking about infection modeling. China’s successful control of SARS in the beginning of this century was an anomaly, not the rule. Once the containment failed, the duration difference between doing a good job and doing a bad job diminished. The virus will take its course to run out. At that point, vaccines and treatments are wonderful things to reduce fatalities, but not to reduce the length of the suffering collectively. After a century, we still cannot meaningfully reduce the length of a pandemic.
Russia’s invasion is a major violation of post WW2 international order. An invasion to a sovereign nation without provocation, not to mention its casually threatening with nuclear arms is unthinkable if all the reference points are from the past 30 years.
But Putin’s talk, with its nationalistic pride, a blame on Soviet Union for Russian’s suffering, can be rooted clearly back to Peter the Great.
Many people now flocked to compare what happened in Ukraine to what happened prior to WW2. I am not so certain. For one, Germany, while suffering from WW1, was a country on the rise. The similarity stopped at personal ambition, and the nationalism running high in that country.
The only way to model a dynamic world, is to read more on history, much much more than what I was doing before. Although I am not sure where to start.
What will happen next? It is anyone’s guess. I would humbly suggest looking over WW2 and trying to find relevant examples before that. Maybe somewhere about 200 years ago.