High-tech models developed by quants have, once again, greatly underestimated risk. What will be the consequences?
In the waning days of April, as federal officials were declaring a public health emergency and the world seemed gripped by swine flu panic, two rival supercomputer teams made projections about the epidemic that were surprisingly similar – and surprisingly reassuring. By the end of May, they said, there would be only 2,000 to 2,500 cases in the United States.
May’s over. They were a bit off.
On May 15, the Centers for Disease Control and Prevention estimated that there were “upwards of 100,000” cases in the country,..