Poor Mystic Marcus. The supposedly-prophetic pig who predicted that England would beat Croatia on Wednesday has been vilified on social media following England’s loss, with fans calling for him to be turned into bacon.
While these are dark days for Marcus, the pig might take some solace in the fact that he’s far from alone in being completely wrong about the World Cup. Before the tournament kicked off a number of investment banks built sophisticated computer models to try and predict the future world champions via the power of data analytics. It might seem bizarre that financial institutions are competing to be soccer soothsayers, but they do it as a kind statistical-model dick swinging; the theory being that if they are good at predicting the World Cup they should also be good at predicting the direction of the markets. Unsurprisingly, however, pretty much all of the big banks’ predictions have been embarrassingly wrong.
Let’s start with Goldman Sachs. This year the banking behemoth continued its unsuccessful tradition of picking Brazil as the winner (it has done so for the last three World Cups). Unlike Marcus the pig, Goldman Sachs didn’t arrive at this conclusion through instinct, but through “hours of number crunching, 200,000 probability trees, and 1 million simulations”. Goldman Sachs’ artificial intelligence-powered algorithms led them to conclude that “England meets Germany in the quarters, where Germany wins; and Germany meets Brazil in the final, and Brazil prevails.” What’s more, the banks stated: “For the doubters out there, this final result was cross-checked in excruciating detail by our (German) Chief Economist Jan Hatzius!”
After Belgium defeated Brazil in the quarter finals, they gave it another go, “with Brazil now out of the World Cup, Belgium is at the top of our probability table”, Goldman’s analysts wrote last week, shortly before Belgium lost to France. The bank also forecast that Belgium would be facing England in the final. (It’s actually France versus Croatia, as I’m sure you are aware.)
For more read the full of article at The Guardian
