It's surprisingly refreshing to read a book that starts with a failed prediction. It shows how much the author has worked on her insight to be actionable and falsifiable.
Many readers would be tempted to immediately shut the book and write off its contents. Most of us love to discard altogether the views we dislike. In most contexts, “Your word is fiction” is an insult.
For millennia, we reasoned in Aristotelean terms: ex falso quodlibet. This has skewed our believing into a very common fallacy: affirming the consequent. For example, "If you are cheating on me, you will be out of the house a lot. You are out of the house a lot, so you must be cheating on me."
When we accept that any future-oriented knowledge has an expiry date and a probability measure things start to finally feel lighter. In Quine's terms, worldviews carry ontological commitments.
With an analogy we used before around here, valid knowledge should be like a financial derivative instrument. Worldviews are options, with a time-scale and a strike. Their ontological commitments (cost and utility!) should be assessed over their volatility surfaces by knowledge makers and takers: it takes two to tango.
An early account of a financial option is credited to the biography of the philosopher Thales of Miletus, an ancient Greek city of western Turkey.
One spring, thanks to his sharp astronomical observation, he forecasted a large harvest of olives. Because of this, he rented out most of the presses of the region for the upcoming fall. This way by summer, when the harvest became evident to most, he could book a sound profit due to the surge of demand for the mills by its fellow citizens (Aristotle, Politics, 1259a).
Although I am not aware any bet was ever made, in the first page of his 1976 Denationalisation of Money, Hayek suggests that a common European currency is impracticable and utopian. History so far has proven him wrong.
But what practical alternative did he propose? Most importantly, why?
Water ripples, what about clouds?
David