Prediction Markets Round-Up

Prediction Markets are a tool for collecting group opinion using market principles. The price is usually based on a conversion of an opinion of the percent likely an event is to happen (i.e., the probability), for example there is a 40% change that Candidate X will win the election. The premise is that there is a lot of hidden information that can be sharable but there are not mechanisms to share it because information-holders either cannot or do not wish to share it (for example that a current work team project may not finish on time). Some research has found that prediction markets may beat polls or experts in terms of forecast accuracy [1].

Figure 1. Prediction Market Example

To aggregate hidden organizational opinion and expertise, Prediction Markets are in use at 100-200 large US organizations as of June 2014: Paypal, HP, BestBuy, Electronic Arts, Boeing, Amazon, Harvard, GM, Hallmark, P&G, Ford, Microsoft, Chevron, Lockheed Martin, CNN, Adobe, American Express, and Bosch. There are several enterprise Prediction Market vendors for enterprise idea management: Consensus Point, Inkling, Spigit/Crowdcast, Bright Idea, and Qmarkets. The main applications of Enterprise Prediction Markets are revenue forecasting, demand planning, and capital budgeting; innovation life cycle management (rate, filter, and prioritize ideas), and project management and risk management.

There are Enterprise Prediction Markets and also Consumer Prediction Markets for event prediction such as politics: election results; economics: box office receipts, product sales; and health: pandemic prediction. Some of the leading markets are Iowa Electronic Markets (and Iowa Electronic Health Markets), the Hollywood Stock Exchange (film box office, TV shows, celebrities), simExchange (gaming: video game consoles, video game launches), CROWDPARK (general), and LongBets (futurist). A new market, SciCast, has recently launched for detailed science and technology predictions.

Markets are typically real-money, reputation-based, or anonymous. In the wake of Intrade’s regulation-forced closure, Bitcoin Prediction Markets are enjoying a surge of trading activity; markets like Predictious, Fairlay, and Bitcoin Bull Bear.

More Information: Prediction Markets @ Singularity University

[1] Trepte, K. et al. Forecasting consumer products using prediction markets. MIT. 2009.

Systems-level Thinking Helps to Address Protein Folding

Deciphering protein folding is critical to a fundamental understanding of biology as proteins conduct most cellular operations, and since misfolded proteins are often causally implicated in disease.

The status of protein folding (describing proteins as folded into their final 3D shape) is that as of January 2014, the main resource, the Protein Data Bank, has 96,000 listed known protein structures. There has been much technological advance in determining the static and dynamic features of protein structures, including in X-ray crystallography, NMR (nuclear magnetic resonance spectroscopy), cryo-electron microscopy, small-angle X-ray scattering, and other spectroscopic techniques.

This sounds like good progress, however, taking the human example, only 24,000 of the Protein Data Bank's 96,000 listed proteins are human, and this is of an estimated total of 2 million human proteins. Further, all of the protein conformations have been determined empirically (e.g.; manually) rather than with prediction (e.g.; digitally). It was proposed that given the amino acid string, it should be possible to predict the 3D conformation of the protein as finally folded, but this has proved elusive. Both scientific and crowdsourced efforts are looking at the problem. Crowdsourced projects include games like fold.it, community projects like Protein Folding@Home, and prediction contests like CASP (Critical Assessment of Protein Structure Prediction), a community-wide, worldwide experiment for protein structure prediction, the next one taking place May – August 2014. All of these projects focus on the unitary folding of one target, such as TM019, as opposed to more universal system dynamics.

Complexity scientist Sandra D. Mitchell presented work at Stanford on January 15, 2014 suggesting that we need a plurality of conceptual representations and models (any model is only partial in some way), and that any complex problem should be addressed with an integrated multiplicity of approaches. Many (and possibly most) complex biological issues such as cancer and aging are now understood as deeply dynamic and systemic phenomena. Similarly, proteins do not fold in isolation, the local environment is highly involved with protein chaperones and other signaling processes (one example is the intricate behavior of toxic amyloid HSPs (heat shock proteins)).

Human Microbiome: Futurist Augmentation Platform

The human microbiome is essential in working symbiotically with the human (and indeed all animals) for nutrient synthesis and pathology prevention. However, the large numbers of microbial populations are complicated and dynamic which makes it challenging to profile their activity and construct meaningful interventions. The 14th Annual Microbiology Student Symposium, held at UC Berkeley on April13, 2013 addressed some of these issues (conference program). 

There is tremendous microbiomic variation between individuals – a person’s gut microbiomic signature is perhaps as uniquely distinguishable as a fingerprint. There may be variability within the individual too, but there is a strong trend to persistent populations over time. The microbiome adjusts quickly to dietary and environmental change, within a day, and can shift back just as quickly. If certain populations are wiped out, other substitute species within the same taxa or phylum may emerge to (supposedly) fulfill a similar function. Pathology conditions like Crohn’s disease, colitis, and irritable bowel syndrome (IBS, IBD) are likely to mean the dysbiosis (e.g.; microbial imbalance) of the whole biosystem (not just are certain disease-related bacterial populations elevated, but mitigating populations may be much lower. Given the complexity of the microbiome with thousands of species across tax and phyla, machine learning techniques may be useful in combining a series of weak signals into a prognostication as the SLiME Project in the Eric Alm lab at MIT has done, claiming to predict IBD as accurately as other non-invasive methods.

In the longer term, the microbiome could be the perfect platform for many different less-invasive augmentations for the human - bringing on board micro-connectivity, memory, processing, and electronic storage (Google Gut Glass?), with applications such as real-time life-tracking and quantified-self monitoring and intervention.

Top 10 technology trends for 2012

1. Mobile is the platform: smartphone apps & device proliferation
2. Cloud computing: big data era, hadoop, noSQL, machine learning
3. Gamification of behavior and content generation
4. Mobile payments and incentives (e.g.; Amex meets FourSquare)
5. Life by Siri, Skyvi, etc. intelligent software assistants
6. Happiness 2.0 and social intelligence: mindfulness, calming tech, and empathy building
7. Social graph prominence in search (e,g.; music, games, news, shopping)
8. Mobile health and quantified self-tracking devices: towards a continuous personal information climate
9. Analytics, data mining, algorithms, automation, robotics
10. Cloud culture: life imitates computing (e.g.; Occupy, Arab Spring)

Further out - Gesture-based computing, Home automation IF sensors, WiFi thermostat, Enterprise social networks

Is it ever coming? - Cure for the common cold, Driverless cars


Looking back at Predictions for 2011: right or wrong?

• Right: Mobile is the platform, Device proliferation, Big data explosion, Group shopping
• On the cusp: Crowdsourced labor, Quantified self tracking gadgets and app, Connected media and on-demand streaming video
• Not yet: Sentiment engines, 3-D printing, Real-time economics

Top 10 technology trends for 2011

1. Mobile is the platform; mobile payment ubiquity could be next
2. Device proliferation continues; tablets, e-book readers, etc.
3. Connected media and on-demand streaming video, IPTV, live event interaction
4. Social shopping: grouppurchasing, commenting, recommendation, LBS
5. Sentiment engines (ex: Pulse of the Nation, We Feel Fine) are ripe for being applied much more broadly to other keyword domains; sentiment prediction
6. Big data era explosion: machine learning, cloud computing, clusters, supercomputing
7. Labor-as-a-service: microlabor, on-demand labor, global task fulfillment
8. Quantified self tracking gadgets and apps (ex: WiThings scale, myZeo, BodyMetRx, medication reminder, nutrition intake, workout coordination, DIYgenomics, etc.)
9. Personal manufacturing, digital fabrication, 3D printing ("atoms are the new bits"); slow but important niche growth
10. Real-time economics: blippy, crowdsourced forecasting, stock market prediction

(Review predictions for 2010)

Real-time economy feeds and ambient economics

Social economic networks are just one part of the broader context of the transformational economics that may eventually lead to a post-scarcity economy for material goods. In addition monetizing alternative currencies and unlocking previously inaccessible value, social economic networks are also generating a critical meta asset: billions of data points which can be aggregated into real-time economy feeds.

At present, the pulse of the real-time economy can be read first through crowd-sourced websites such as Blippy, where users automatically post personal economic transactions as they occur, and consumer prediction markets sites like the Hollywood Stock Exchange and the simExchange, where users opine on box office receipts of new movie releases and the sales levels of new video games.

Aggregated longitudinal comparisons can be made, for example getting an early look as to whether this is a slower quarter for a particular company, or whether consumer spending in general is lower in this period compared to another.

Just as social media ‘likes’ and status update commentary can be used to infer consumer values and preferences with a sentiment engine for anticipatory demand, this data too can be aggregated. While many dismiss ‘I ate a hotdog’ as meaningless social media drivel, when aggregated at the macro level, it could be more broadly meaningful as a leading indicator of pork consumption.

Connecting social economic networks with real-time location through mobile networks and smartphone applications could be another significant step in shifting economics as buyers and sellers connect seamlessly in an ongoing process of ambient supply and demand interaction and automatic markets.

Humanity: hedgehog or fox?

Isaiah Berlin discusses an interesting paradigm for understanding different kinds of thinkers, the hedgehog and the fox. The hedgehog operates under a single vision while the fox incorporates many ideas into a worldview. Philip Tetlock applies this framework to an analysis of political predictors and finds that while all expert predictors are bad, foxes are not as bad as hedgehogs. The success of the fox is perhaps partly due to Bayesian updates, adjusting the synthesis-oriented worldview per new information, as opposed to the hedgehog being stuck trying to fit all new developments into the same model.

Humanity: hedgehog or fox?
It could be argued that so far all of human history has been organized around certain grand hedgehog visions such as mastery over matter, immortality or evolution, to name a few.

Mastery over Matter
Over time, humans have been continually demonstrating increasing mastery over matter. The current focus is on improving control of biology and indeed reengineering it with genomics and synthetic biology, matter with 3D printing and eventually molecular nanotechnology, the brain with fMRI technology and smart-drugs and space with a next-generation understanding of physics. Perhaps the most intense version of mastery over matter is the present focus on the biomolecular interface, the integration of organic and inorganic matter. However mastery over matter may not persist as a paradigm, a future redefinition could include mastery over information.

Immortality
Immortality is another grand vision, persisting from the time of the Pharaohs and earlier to long-established religious beliefs to the contemporary notions of life extension, uploading and cryonics. In some sense, immortality is just another kind of mastery over matter.

Evolution
Evolution is a strong paradigm, explaining many things, and connotes a higher order than just mastery over matter since not everything is matter. Evolution can examine more phenomena, including the progression of intelligence, possibly across substrates as is contemplated with artificial intelligence. However, despite myriad application attempts, it is not clear yet whether evolution can explain everything, for example the laws of physics and how the universe developed.

Conclusion
Since even in a simple analysis, no one model can explain everything and there are multiple ideas relating to a composite explanation of human activity, the conclusion would be that humanity bears more resemblance to the fox model than the hedgehog model. Tetlock’s finding that the multi-viewed more adaptable foxes are better could likely hold true for societies and humanity in general as well as for individuals.