Predictions #1

July 5, 2023 at 2:24 PM

These are my predictions and thought processes for week 1 of the Metaculus Quarterly Cup which started yesterday, July 4th. All these predictions were made during the ‘hidden period,’ before the community prediction was made public. I plan to update my predictions throughout the week (they’re all ‘short fuse’ questions). I’ll summarize any major updates in next week’s post.

Will the Black Sea Grain deal be extended before July 19, 2023?

Resolution Criteria: This question will resolve as Yes if, before July 19, 2023, credible sources report that the Black Sea Grain Initiative has been extended beyond the current end date of July 18, 2023.

My Prediction: 87% Yes

Reasoning:

First, let’s establish a starting point. The Black Sea Grain Initiative has previously been extended 3 times, first for 120 days, then twice more for 60 days each. Russia temporarily withdrew from the deal last fall for a few days, prior to the first extension. In each case prior, the deal wasn’t extended until close to the deadline. So as a starting point, it seems likely that the deal will be extended again, however Russia is clearly okay with withdrawing, at least temporarily. [85% Yes]

Russia seeking to extract concessions in the lead up to the deadline is not new. Looking at news headlines in advance of the prior extensions, I found similar headlines to those we see today, though today’s do sound somewhat more dire. From May:

“The current extension of the deal expires on May 18, and Russia has said it will not extend the pact beyond that date unless its list of demands is met to remove obstacles such as restrictions on payments, logistics, and insurance.”

Russia’s rhetoric seems typical for a negotiation process - expressing willingness to walk away if its conditions are not met, but not outright stating that it’s done negotiating. Together, these factors slightly strengthen the ‘No’ case, but only slightly - it’s simply too far from the deadline to move strongly towards No. [80% Yes]

Russia’s primary demands are (1) reincorporation of Rosselkhozbank into the SWIFT payments network, and (2) that the west stops holding up its own grain and fertilizer exports (it’s unclear if this is actually happening or not). The U.N. has demonstrated some willingness to compromise on these points, suggesting alternatives to full reincorporation of Rosselkhozbank into SWIFT. Russia has rejected these proposals so far, but they indicate an actual negotiation process occurring. This strengthens the Yes case. [83% Yes]

Lastly, wheat futures show no indication that a major supply disruption in global supply is anticipated. If supply was expected to drop sharply, we would expect an uptick in the futures market. Futures have steadily declined since last October, and after an uptick mid-June, have declined to near their lowest levels since the invasion began. [87% Yes]

New evidence aside, this estimate should drop as the deadline approaches, slowly at first (in previous instances, deals came near the deadline) and more quickly near the deadline.

Will General Sergei Surovikin be stripped of his command by July 11th?

Resolution Criteria: The question will resolve Yes if there are official announcements, credible reports, or statements from authoritative sources—before July 12, 2023—confirming that General Sergei Surovikin is no longer the Commander-in-Chief of the Aerospace Forces. It will also resolve Yes if a new Commander-in-Chief of the Aerospace Forces is appointed.

My Prediction: 6% Yes

Reasoning:

Let’s first think about what the probability would’ve been prior to the Wagner mutiny, and then consider how much that should change our belief.

Before the mutiny, Surovikin was regarded as competent and was popular among Russian troops. He’s held this position for 5 years, and there was no indication he was in imminent danger of losing it. Battlefield conditions have been good for Russia in recent weeks, at least relative to other stretches during the war. [2% Yes] pre-mutiny.

At first glance, the recent turmoil would seem to significantly increase the chance of leadership changes. On the other hand, Putin may want to avoid the appearance of ‘giving in’ to Wagner’s demands by promptly making a major leadership change. Together, I think this should slightly raise the estimate. [4% Yes]

More significantly, and the reason this is even a question: there are reports suggesting that Surovikin was involved or aware of the Wagner plot in some capacity. I’ll try to unpack some of what we know:

• Evidence is very limited. Almost everything we know comes from one or two publications which received information from unnamed US intelligence sources. This should limit the magnitude of any other adjustments to the estimate.
• Surovikin reportedly was detained and questioned in the days following the mutiny. He hasn’t been seen in public for over a week. [9% Yes]
• He reportedly had a good relationship with Prigozhin. [9.5% Yes]
• It’s possible he was aware of the Wagner plan in advance. He may have been an active participant, he may have known and not taken action, or he may have known and attempted to tell others and prevent the mutiny. All of these are real possibilities, but the second and third seem most likely. It’s also possible he was not aware of the plan in advance. (No update here, no good information)

Other factors to consider:

• US intelligence is incentivized to seed chaos / stoke suspicion in Russian leadership. Surovikin was regarded as highly competent and it would be in Ukraine’s interest to take him off the table [8% yes]
• US media is also incentivized to exaggerate this story or publish it with less scrutiny / weaker evidence. It’s a juicy, palace-intrigue story that will get clicks 7% Yes
• Putin has given no indication that Surovikin’s position is threatened. His spokesman has dismissed any such claims as gossip. [6.5% Yes]
• Russia experts (Rob Lee, Stephen Kotkin) have not indicated they anticipate imminent action regarding Surovikin. [6% Yes]

If some of these updates seem too small, keep in mind this question is about only the next week, so there’s a high bar for making a large update.

Will the Dow Jones close at or above 35,000 before August 1, 2023?

Resolution Criteria: This question will resolve as Yes if, after July 3, 2023 and before August 1, 2023, the Dow Jones Industrial Average (DJIA) closes at or above $35,000 according to Yahoo Finance.

My Prediction: 59% Yes

Reasoning:

My prediction for this question is entirely based on historical averages - I don’t expect to be able to out-think the market on this one.

• The starting price (as of July 4) is $34,418.47
• $35,000 would be a 1.69% increase from the current price
• 20 trading days remain between now and August 1
• Over the last 10 years, for a given day, there was a 59.06% chance that over the ensuing 20 trading days, the price exceeded the price on the first day by more than 1.69% (data from FRED)

So my prediction is 59% Yes. After each day, I can run the numbers again with the new starting price and remaining number of days. Not going to overcomplicate this one, certainly there probably are better ways to do this, but I think this is at least a reasonable approach.