Are you a “Speculator” or an “Evaluator”?
June 26, 2011 Leave a comment
In the days leading up to last week’s NBA draft my go-to form of procrastination was reading all the draft-related rumors and predictions I could find. Then the draft happened and I didn’t bother to read a single analysis of the picks. My rationale was that “professional” pundits generally know nothing because it’s impossible to effectively evaluate picks until the players start playing.
Alternatively, one could argue that the pre-draft coverage is completely valueless when compared with the post-draft coverage. Why concern yourself about a myriad of possibilities when you’ll soon find out exactly what happens? In fact, this is my attitude when it comes to political speeches. I have no interest in what people think Obama will or should say, but after he says it I’m usually interested in reading what people think.
The rapid demise of my interest in draft coverage got me thinking about the consequences of having a tendency to prefer pre-event coverage (being a “speculator”) or post-event coverage (being an “evaluator.”) It seems that being a speculator is beneficial when reacting to a low probability event that reveals little new information about the world (a single soccer game, a successful high-risk terrorist attack). In these cases the pre-event analysis is still accurate and the post-event analysis is likely to be skewed by over-emphasis on the event.
On the other hand, being an evaluator is likely to be beneficial when reacting to an event that reveals significant information (a seven game NBA series, an IPO, a TV show plot twist). In these cases the pre-event analysis is rendered relatively obsolete and those who eagerly consumed it will likely be left with inaccurate beliefs.
Are you a speculator, an evaluator, or both?