From the Editor: Predicting the Future
Harvard psychologist Daniel Gilbert posed in his book, “Stumbling on Happiness,” that, “the human being is the only animal that thinks about the future.” In other words, it is our imagination that sets us apart as a species.
Armed with knowledge of the past and present, and with a vision of the future, many set off on a path to try and predict the future. It happens all around us. Every year, football fans and analysts alike quote statistics, play out arguments or just rely on gut feelings to make their predictions for the winner of the Superbowl.
Whether these fans’ predictions are motivated by potential monetary gain or not, one place where it most decidedly is is Wall Street. Investors, brokers and traders brave the chaos of the trading floors every day trying to predict the future of companies and commodities around the world, investing money in companies poised to make a profit and selling the stock of those they believe will fail.
In fact, so many are engaged in sorting through market data and analyzing the health of companies, that some perceive the markets as efficient, a hypothesis originally proposed in the 1960s by Dr. Eugene Fama, who believed “stock prices are ensured by the ready availability of ample information and by the vast number of rational investors avidly following each stock.”
Others pour through this data in search of incorrect stock prices. They have a belief that the markets are inefficient and, therefore, present an arbitrage opportunity, or a chance to make money on a company or stock that is priced lower than it should be, giving them a chance to purchase the stock of a company on the rise at a cheap price.
Whether you believe markets are efficient or not, few places have developed as many tools or theories on their trade as the financial sector. The shear number of equations and algorithms developed, or “invented,” to measure the health of a company is amazing. Not only do we as human beings have the ability to imagine the future, but also invent that which can get us there.
The idea is evident in the famous quote from Robert Kennedy, “Some men see things as they are and ask why...I dream things that never happened and ask why not?” It is our ability to imagine the future that is the cornerstone of innovation.
Innovation leads not only to new methods and inventions, but also the improvement of existing products and practices. And I am not just talking about taking an existing product and sticking a clock in it.
Check out this month’s Quality feature, “Flash Forward: Today᾽s Environmental Test Chamber” and see what’s being done to improve test chambers. Also, discover new ideas taking shape in sensing systems with Norm Axelrod’s article, “Best Practices for the Development of Sensing Systems for Production and Quality Control.”
As always, enjoy and thanks for reading!