Fooled By Randomness
The modern world regards business cycles much as the ancient Egyptians regarded the overflowing of the Nile. The phenomenon recurs at intervals, it is of great importance to everyone, and natural causes of it are not in sight.
~ John Bates Clark, 1898
~ Nassim Nicholas Taleb, 2001
It is one of those books with an interesting premise that grows steadily less interesting as you read. And as I read I had the growing feeling that the book could have been conveniently summarised in a dozen and a half bullet points with a few anecdotes tacked on for amu ...more
I think the powerful ideas could have been condensed down to a New Yorker length article:
1. We tend to see the "survivors"; by hiding those who have failed, our understanding of many systems is skewed.
2. Leveraged betting on conventional wisdom provides consistent returns in the short run, but can explode when something weird happens (his "black swan idea").
3. You can reproduce the results of many systems by s ...more
Instead, this book read like a pretentious, ranting diary. In the introduction, the author brags that he ignored nearly all of the suggested changes his book editors made (he labels book editors along with journalists, MBAs, and most social sc ...more
"trading rooms were populated by people ..devoid of any introspection, flat as a pancake..." p28
"these scientists ... devoid of the smallest bit of practical intelligence" p 30
The author likes the word 'devoid'.
"I was saved from the conversation of MBAs."
"but i could not conceal my disrespect ... as he could not make out the nature of my conversation" p.31
"a journal ...more
Taleb is a stock market trader. As a trader, he believes that there is no way in general to predict the stock market -- that there are so many variables that the resulting stock price is indistinguishable from pure noise. Unfortunately, his profession is filled with people who believe that they *can* predict the market. In fact, so ...more
We are so accustomed to looking at the world and seeing patterns that we do not always understand that we may be seeing randomness and imposing a pattern where none belongs. Taleb talks about the variou ...more
There is something wrong almost constantly, but the biggest WTF moment came for me, when Taleb, who constantly reminds the reader that everybody else is a fool and it's just him who has insight and the tools to master probability, talk ...more
Here is the crux of the book. Brokers have a very common weakness. They fail to appreciate that the likelihood of an event can not be the only factor one looks at when deciding to make a move. The likelihood, and the cos ...more
Всъщност, случайността се ражда с появата на хората, тъй като за да съществува тя, трябв ...more
Unfortunately these ideas come littered with classical references, none of them properly explained, that do little to strengthe ...more
Anyone reading both books might get the impression that this guy is an infalible trader. He is, if there are regular market catastrophes. He started his own fund based larg ...more
I read a used copy of this book lent to me by a friend who peppered it with wonderful marginalia. My favorite of these captured the narrative tone well in response to the author making a fairly mild generalizatio ...more
Having taken several probability and econometrics classes, I really respect how scientists get around the problem of uncertainty. Probability is a powerful tool, but we are not well informed yet. And to tell the truth, the way probability is taught doesn't help either: textbook would like to lose track of real life and our minds are not engineered to fathom abstract things so well.
I agree with Taleb's main ideas enoug ...more
Препоръчвам я на всички, които са им интересни икономиката, финансите и като цяло ролята на случайността в живота. Книгата би подействала и доста приземяващо на хора, които се взимат твърде насериозно.
Now that hi ...more
What I found is a witty, personable narrative about the dangers of pattern recognition, novelty addiction and overestimating our ability to be rational. Taleb draws on philosophy, mathematics, psychiatry and personal experience ...more
Самый интересный и наглядный пример того, что люди заблуждаются относительно причинности событий или последствий совершения каких-либо действий — в кусочке ниже.
«Когда я возвращаюсь домой из азиатской или европейской поездки, временной...more