Fooled by Randomness Revision (Not Available in US): The Hidden Role of Chance in the Markets and Life
by Nassim Nicholas Taleb
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Read in August, 2007
"Expect the unexpected" -- an aphorism that almost completely summarises the book. Cliches exist for a reason, but 196 pages later I feel the point has been well made.
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 marke...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 marke...more
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Read in April, 2008
Well, if you can get beyond the fact that Nicholas T Taleb most likely hates you, his arguments are valuable. The idea of the book is that we discount the true probablistic picture of most situations and make decisions that we think are smarter than they are... we are lucky enough just not to get caught. He hates people who think they made wise decisions but were, in fact, just fortunate not to experience the bad outcomes. Hates them. They are so incredibly stupid. The neat idea I found mys...more
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Renowned statistician George Box once said, “All models are wrong, but some are useful.” The author of Fooled by Randomness is all over the first part of this statement, but apparently doesn’t consider it part of his job as an iconoclast to say anything about the second. Taleb goes to great lengths to point out how some of the original assumptions made in investments and finance have blown up in people’s faces. Yes, unusual events do happen more often than a normal distribution...more
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Read in July, 2007
This is a reread of Taleb's first discourse on probability and markets, which I wanted to reread after reading The Black Swan earlier this year. I still found the ideas important and well organized. There was just a hint of the author's attitude that literally permeated the second book, making this a much more effective read.
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 b...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 b...more
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Read in February, 2008
This is one of the best books I have ever read. It has everything in a book that I yearn for....interesting ideas...some of which I don't grasp because hey are too clever for me...a smug narrator who seemingly knows more than everyone else...and a well-written and pleasing style.
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...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...more
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Read in May, 2007
recommends it for:
people who think they are better than journalists, pundits, economists, or sociologists
The book is an easy read and most of what it offers can be gleaned from undergraduate level statistics and psychology classes. Specifically: a catalog of unintuitive statistical results, and explanations/anecdotal examples of many psychological biases, and a lecturer with a swollen ego.
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 genera...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 genera...more
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Read in November, 2008
Fooled by Randomness combines a few of my favorite topics into one riveting, if wandering, discussion of how probability combines with psychology to fundamentally change our lives.
If you've heard about this book because you are an investor, and you expect it to offer tips on how to make more money on trades, you will likely be disappointed. The lessons of the work are certainly applicable to the markets, but, more importantly, the ideas contained are more valuable as an excursion into some ...more
If you've heard about this book because you are an investor, and you expect it to offer tips on how to make more money on trades, you will likely be disappointed. The lessons of the work are certainly applicable to the markets, but, more importantly, the ideas contained are more valuable as an excursion into some ...more
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recommends it for:
an unthinking Randian or Hayekian.
One of the most self-congratulatory, didactic books I've ever read. Taleb is a convinced ideologue whose expertise in stock trading has created the conviction that he sees the invisible hand at work.
He constantly reminds the reader that he is writing, restating and recasting sections with a reference to his earlier statements (never trust a writer that quotes himself) while dismissing whole schools of thought by selectively quoting from philosophers to make them look silly and misgui...more
He constantly reminds the reader that he is writing, restating and recasting sections with a reference to his earlier statements (never trust a writer that quotes himself) while dismissing whole schools of thought by selectively quoting from philosophers to make them look silly and misgui...more
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Read in July, 2008
This is a book that has and will continue to irritate many readers, both in its content, which argues with a lot of mainstream economic theory and practice, and in its style, which is sometimes arrogant or abrasive. And I think it's safe to say that the book's author would be perfectly well pleased to have those irritated readers shut the book and ignore what he has to say. Taleb comes across like a lot of polymath autodidacts -- he's obviously very smart, doesn't suffer fools lightly, and is h...more
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Read in June, 2008
How can you not love a book in which the author has this to say about himself as a successful Wall Street trader:
"We are a bunch of idiots who know nothing and are mistake-prone, but happen to be endowed with the rare privalege of knowing it."
Not only does this fully illustrate the knowledge to be gained from a book that illustrates, often in technical mathematical and financial terms that are difficult for laymen like me to understand, the role in which randomness plays in m...more
"We are a bunch of idiots who know nothing and are mistake-prone, but happen to be endowed with the rare privalege of knowing it."
Not only does this fully illustrate the knowledge to be gained from a book that illustrates, often in technical mathematical and financial terms that are difficult for laymen like me to understand, the role in which randomness plays in m...more
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Read in July, 2008
Some authors' personalities suffuse their books. This can be both good and bad: Steven Johnson, for example, seems like the kind of guy that I'd love to sit next to at a dinner party: funny, smart, interesting and amiable.
Nassim Taleb, on the other hand, seems like the kind of guy I'd rather avoid. In this book he tells us how little he is impressed by people with money, wh...more
Nassim Taleb, on the other hand, seems like the kind of guy I'd rather avoid. In this book he tells us how little he is impressed by people with money, wh...more
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Read in August, 2008
recommended to Brian by:
State Streetrecommends it for: misanthropes who like schadenfreude
You have to admit that Taleb is a smart man, who at the very least wants us to realize that humans just don't really understand probability and statistics. Sometimes its genetic and beneficial(i.e. running from a tiger instead of trying to process to a certainty whether or not it wants to eat you). Other times we are blinded by greed or fear. Randomness pervades our lives and we innately or unintentionally seek to eliminate it. And when he's got a case, he's got a case.
However, one must also...more
However, one must also...more
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Read in January, 2007
This review has been hidden because it contains spoilers. To view it, click here.
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Read in April, 2008
recommended to Sophie by:
Boyfriend
I am not an economist or a trader so I had to spend a great deal of time and effor to actually understand the book. I know that this book has mixed reviews; many feel the author is too arrogant while some feel that he has made some salient points about today's investment traders.
Since I am no expert on trading, I do not want to make any strong comments about the book. All I can say is that from a non-trader's point of view, the book has only one idea ; and that is clearly stated in the title...more
Since I am no expert on trading, I do not want to make any strong comments about the book. All I can say is that from a non-trader's point of view, the book has only one idea ; and that is clearly stated in the title...more
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Read in February, 2008
Locks of good anecdotes in this book that are buried in terribly boring text. I couldn't read more than 3 pages without my eyes glazing over.
Overall, the theme of the book is that most events are random. Though people think things happen for a reason, in truth there may not be a reason.
A few exerps that I found interesting:
"Imagine a donkey equally hungry and thirsty placed at exactly equal distances from sources of food & water. In such a framework, he would die of both thi...more
Overall, the theme of the book is that most events are random. Though people think things happen for a reason, in truth there may not be a reason.
A few exerps that I found interesting:
"Imagine a donkey equally hungry and thirsty placed at exactly equal distances from sources of food & water. In such a framework, he would die of both thi...more
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Read in January, 2008
recommends it for:
investors and 'traders'
just downloaded from audible.com
This was a very thought provoking and enjoyable audiobook. Anyone who invests is the stock market or thinks they are a trader should read it. It is also of general interest to people who would like to understand the impact of randomness on life.
Narrator: Sean Pratt
Publisher: Gildan Media Corp, 2008
Length: 10 hours and 1 min.
What the Critics Say
"[Taleb is:] Wall Street's principal dissident....[Fooled by Randomness:] is to convention...more
This was a very thought provoking and enjoyable audiobook. Anyone who invests is the stock market or thinks they are a trader should read it. It is also of general interest to people who would like to understand the impact of randomness on life.
Narrator: Sean Pratt
Publisher: Gildan Media Corp, 2008
Length: 10 hours and 1 min.
What the Critics Say
"[Taleb is:] Wall Street's principal dissident....[Fooled by Randomness:] is to convention...more
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Read in December, 2006
I just finished rereading this book. I liked it much more the first time than this time.
A lot of good points are made in this book, such as people are innately unable to grasp the amount that randomness/chance plays in their lives unless they really think about it; that emotions play a necessary but sometimes unfortunate role in making decisions; and that even rational people aren't as rational as they think.
The book takes a long time to make these points and throws in a lot of frustrati...more
A lot of good points are made in this book, such as people are innately unable to grasp the amount that randomness/chance plays in their lives unless they really think about it; that emotions play a necessary but sometimes unfortunate role in making decisions; and that even rational people aren't as rational as they think.
The book takes a long time to make these points and throws in a lot of frustrati...more
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Read in September, 2007
recommends it for:
anyone thinking life is unfair
If last week somebody told me a stock market trader/mathematician can write a thrilling non fiction, I would think he is crazy. Not anymore. 'Fooled' gives me rushes as much as Dan Brown's Angels and Demons or the last chapter of Tom Clancy's Sum of All Fears, you just can't put it down. All this from a finance/maths geek!
The premise of the book is simple, and can be both humbling/alleviating at the same time. In this life we probably have underrated randomness/luck/'hokkie' by too much. We ...more
The premise of the book is simple, and can be both humbling/alleviating at the same time. In this life we probably have underrated randomness/luck/'hokkie' by too much. We ...more
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Read in July, 2007
Fooled by Randomness is both a very interesting book, and a not very well written one. It is constructed in an almost random (ha!) manner, leaping from one subject to another and never landing on any of its many ideas for very long. The basic concept of the book (and of Taleb’s work in general) can be laid out in a single sentence - We underestimate the role of chance in out lives. His explanation for why we underestimate it, and how that under estimation affects our lives is what makes up the...more
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Read in August, 2007
This book really blew my mind and challenged my thinking and assumptions I'd been making about phenomena that *seem* related. Many times, it's really us that give context to events and coincidences that are really, truly, random and unintended. I found it liberating to ponder the possibilities, and how I could add my own meanings and significance to the past- or not.
The pacing was a little slow and it was hard to get through but the insights were worth it.
The pacing was a little slow and it was hard to get through but the insights were worth it.
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