PREDICTIONS—THE JULIAN SIMON BET REPEATED.

PREDICTIONS—THE JULIAN SIMON BET REPEATED. John Tierney had an article in the New York Times (December 27, 2010) about how he won a $5000 bet on the price of crude oil that was modeled on the Julian Simon Bet. In August 2005, Tierney had bet with a man that the price of crude oil, which was then at $65, would average $200 in 2010. As described in this wikipedia article, Julian Simon made a famous bet with Paul Ehrlich in 1980 that the prices of five commodities that Ehrlich was allowed to select would be lower in 1990. Simon won all five bets. I referred to the Julian Simon Bet in this post about how Professor Paul Ehrlich had continued to be a prominent environmentalist, despite the failure of his predictions, including that there would be “hundreds of millions of people starving to death” in the 1970s and ’80s. I think that one of the appeals of this kind of thinking is that the mathematical models are simple. Assume fixed resources, assume population growth, and there you are. John Tierney concluded his article: “I’d say that Julian Simon’s advice remains as good as ever. You can always make news with doomsday predictions, but you can usually make money betting against them.”

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