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3.72 AVERAGE
3.72 AVERAGE
Fooled by Randomness by Nassim Nicholas Taleb, examines the world of Wall Street trading and how randomness plays a part. I found the writing to be extremely arrogant and condescending, not to mention outright boring. This book was extremely disappointing, especially after reading a review that compared it to Freakonomics (which I found fresh and interesting).
Complete review at http://chereemoore.blogspot.com/2010/01/ilym-52-books-in-52-weeks_27.html
Complete review at http://chereemoore.blogspot.com/2010/01/ilym-52-books-in-52-weeks_27.html
Challenged my thoughts with a pinch of humour + realism.
Black Swan event;
• an outlier/rarity
• extreme impact
• retrospective
Black Swan logic: what you do not know is far more relevant than what you do know.
Key points from Black Swan:
• The normal bell-curve distribution predict approximation of results that does not necesserily accounts for Black Swan outliers —shift the distribution significantly. Contributed by pure chance and the tendency for obvious outliers which leads to significant impact due to specific circumstances.
* Gaussian bell curve —few data sets can be effectively analysed using the normal bell distribution in reality.
• Platonifying: The human mind tends to create an illusion of understanding things that are too complex for it to grasp, making chaotic events seem orderly and predictable in retrospect, and overvaluing neat classifications.
• Complex systems are viewed as random due to the lack of available or comprehensible information —predictability is relative to knowledge.
• Predictive models are distorted as a result of generating simplified narratives of the causes of Black Swans and demonstrating their probability after the fact prevents people from taking into account the many complex factors that actually caused the event caused the event, which then distorts predictive models.
• Bad predictions are mostly rooted in extrapolating from the past, which does not always take into account actual, current threats faced.
• Almost evryone of us, especially experts in rapidly changing fields, have tendency to be overconfident in their knowledge —additional information of a topic leads to blind confidence in uninformed determination and unwillingness to revise conclusions and predictions.
Strategy for withstanding Black Swan:
• Be true to ourselves especially on our ignorance/things we do not know
• consider decisions based on available information instead of long-term assumptions
• contemplate on possible risk and adopt methods to minimise risk
I have a lot of comments on it as well but honestly a good read
Very interesting book, and glad I got the second edition with the book-length essay with updates at the end. The premise of the book is that we shouldn't attempt to calculate the odds or the risks of the unknown unknowns, but rather create robust systems that are more likely to withstand the inevitable black swan. All in all great advice, and I do need to rethink some of my investment strategies.
But, the journey to get to the conclusion was a bit painful, with many self-congratulatory stories and sometime humorous but incessant jibes at economists, the French, etc.
But, the journey to get to the conclusion was a bit painful, with many self-congratulatory stories and sometime humorous but incessant jibes at economists, the French, etc.
A tour de force! What a great use of critical narrative techniques.
Saggio molto interessante sulla difficoltà di prevedere -e contemplare- gli eventi rari, nonché sulla fallacia dei modelli previsionali basati sulla curva gaussiana.
Nonostante l'approccio analitico (quasi ridondante), il tono dell'autore è spesso egoriferito e supponente, in aperta polemica con i suoi detrattori.
La parte matematica è meno complessa di quanto temessi e si riesce a seguire con un po' di concentrazione.
Tre stelle e mezza arrotondate a quattro per la sorprendente facilità di lettura.
Nonostante l'approccio analitico (quasi ridondante), il tono dell'autore è spesso egoriferito e supponente, in aperta polemica con i suoi detrattori.
La parte matematica è meno complessa di quanto temessi e si riesce a seguire con un po' di concentrazione.
Tre stelle e mezza arrotondate a quattro per la sorprendente facilità di lettura.
I don't know enough about economics and mathematics and philosophy to critique Taleb's critique, but this was an interesting read and, for my metaphor-loving brain, made me think differently about interpersonal relationships and self-reflection (since I sure wasn't going to think about econometrics). I spent most of it thinking that Taleb was insufferably arrogant, too proud of his own erudition, and a seriously annoying namedropper. But he redeemed himself with the last lines "Always remember that you are a black swan. And thank you for reading my book." Aww, so sweet.
I had to read the book that predicted the financial shenanigans that caused the 2008 recession/market crash. Basically, unknown unknown stuff is out there and will happen and will have a huge impact positively or negatively. Try not to be a sucker by minimizing the impact of the black swans negatively. I’ll stick with my current index investment style and keep black swans in mind by stacking emergency fund cash and having decent insurance coverage.
I relate to black swans more on a medical side as a young survivor of a unknown caused stroke. I actually find solace in thinking of it as just random black swan than an underlying condition waiting to take me out. One of my favorite parts was the end. Our very existence is a black swan.
Bit bloated and long for some of his points, but I enjoyed it enough to keep reading.
I relate to black swans more on a medical side as a young survivor of a unknown caused stroke. I actually find solace in thinking of it as just random black swan than an underlying condition waiting to take me out. One of my favorite parts was the end. Our very existence is a black swan.
Bit bloated and long for some of his points, but I enjoyed it enough to keep reading.
The Black Swan was an unusual reading; a list of thoughts, opinions and author's ideas about absolutely unpredictable but extremely impactful events in our life. The title refers to the opening of Black Swan’s in Australia, a groundbreaking event in the 17th century when Europeans believed that swans could be only white. Interestingly, people tend to easily find clear reasons for “black swans“ after it has occurred and are powerless to predict them in advance.
An author differentiates two categories of areas widely spread in our life - one where such events are frequent - Extremistan (economy, politics, wealth), and the other more stable - Mediocristan. And we are almost living in Extremistan, where you can win a lot eventually and lose everything in a day. Since we are there, the huge recommendation is to remember about extremum cases, swans. Prefer fractal instead of gaussian distribution for analytics, which is relevant for Mediocristan. Barbell Strategy is a recommendation for doing staff safely in Extremistan. When you want to do some risky action, have a stable backup, and probably invest 80% in stable things and the other 20% in venture and risky but beneficial ones.
The main idea the author has inspired me is to focus on our reaction in case of such an event happens, but not on thinking when or if it happens. A funny but clear example of future prediction described in this book was the “turkey challenge”. Every day turkey is fed well; it thinks everything is going better and better. But in reality, turkey is one day closer to being roasted for some family celebration every holy day, and eventually, it happens. Paradox...
An author differentiates two categories of areas widely spread in our life - one where such events are frequent - Extremistan (economy, politics, wealth), and the other more stable - Mediocristan. And we are almost living in Extremistan, where you can win a lot eventually and lose everything in a day. Since we are there, the huge recommendation is to remember about extremum cases, swans. Prefer fractal instead of gaussian distribution for analytics, which is relevant for Mediocristan. Barbell Strategy is a recommendation for doing staff safely in Extremistan. When you want to do some risky action, have a stable backup, and probably invest 80% in stable things and the other 20% in venture and risky but beneficial ones.
The main idea the author has inspired me is to focus on our reaction in case of such an event happens, but not on thinking when or if it happens. A funny but clear example of future prediction described in this book was the “turkey challenge”. Every day turkey is fed well; it thinks everything is going better and better. But in reality, turkey is one day closer to being roasted for some family celebration every holy day, and eventually, it happens. Paradox...
A squeezed version with empiricism, scepticism, Popperian falsification, chaos theory, economics (and making bucket loads of fun at them).
This book has a weird humility to it, it's not humble in a lot of places and is downright modest in some. Mr. Taleb surrrre loves to present his past readings.
A wonderful, eye-opener that just begs the statement "Can you please, for Fs sake, not believe in everything the snake oil salesmen around you peddle?"
This book has a weird humility to it, it's not humble in a lot of places and is downright modest in some. Mr. Taleb surrrre loves to present his past readings.
A wonderful, eye-opener that just begs the statement "Can you please, for Fs sake, not believe in everything the snake oil salesmen around you peddle?"
The Black Swan is at its most essential a book about unknown unknowns or ‘how to not be a sucker’. The most important book anyone in the business of quantifying risk could read.