This a naturally accounts for two puzzling aspects of cortex. First, it provides a rationale for the tight balance and correlations between excitation and inhibition. Second, it predicts asynchronous and irregular firing as a consequence of predictive population coding, even without any external source of noise. These networks are far more accurate and robust than comparable rate models. This suggests the reliability of cortical representations could have been strongly under-estimated. Moreover, this model has implications implications for sensory and motor tuning curves. We will concentrate on two illustractive examples: a "diffusion model" for decision making and a simplified arm controller.