5 ms·
I liked both and learned significant things from both. Haven't yet read anti-fragile. In particular, the idea that the financial models (think Black Scholes an
by wglb 10y ago
I liked both and learned significant things from both. Haven't yet read anti-fragile.
In particular, the idea that the financial models (think Black Scholes and Long Term Capital Management) are based on seriously bad (e.g., non-fractal) ways of thinking about the way that the world works. The incident where Mandelbrot detected the prices of cotton to have an element involving some unexpected exponent (one sixth? memory isn't bringing that up). The standard way of thinking about these facts admit that they can't handle that. Thus, much of the way risk is modeled is like the guy looking for his lost ring under the street lamp even though he lost it half a block down. "At least there is light here."
Who else is telling us that bell curves and current risk models don't work? Not CNBC, Yahoo, Fox.
Another thing that I took away was how uncomfortable financially successful people are with the idea that luck is a significant component, perhaps even more than their talent and business skill.
Insofar as the issue of his tone or arrogance is concerned, I don't get that. Is it possible that when we complain about an adversary or messenger with bad "tone" or "arrogance" that there is something in the message that we don't like? Certainly he is direct and blunt in his approach. Doesn't put me off.
I feel like it is similar to the reaction that many classically trained engineers when confronted with chaos theory. The world can't possibly be that "random". Except that there is some deep beauty in this oddly-named "Chaos" theory that lends exceptional stability to many phenomenon.
And on the topic of Chaos, it is interesting to go back to James Gleick's Chaos: Making a New Science and read the part about how "there is no climate". Essentially, there isn't anything that guarantees us that the whole system won't just float off arbitrarily into a new Ice Age. Contemplate that in today's debate about climate change. That is, if you postulate that there is "global warming" (renamed to the more apparently less controversial "climate change") and get everybody to agree, what do you do? Is it not possible, in a chaotic system that is moving to a new attractor, that actions we take, like cutting in half carbon emissions, might have a totally unexpected effect? That would be my bet. Kind of a complicated decision to make in a heated political arena, populated by tribes of one sort or another, don't you think?
So the lesson from Swan and Fooled, in the large, to me, are "your models for how stuff works is likely busted, particularly if your income depends on you believing in them."
But then I am just a simple country boy.
- tptacek 10y agoYeah, that's the message I got. Maybe I'm just too receptive to that idea? I felt like, for the number of words and metaphors he spent, there must be some subtlety I was missing.
- cossatot 10y ago> Insofar as the issue of his tone or arrogance is concerned, I don't get that. Is it possible that when we complain about an adversary or messenger with bad "tone" or "arrogance" that there is something in the message that we don't like? Certainly he is direct and blunt in his approach. Doesn't put me off. Wasn't a substantial part of Black Swan a story about a fake novelist writing a novel that people didn't like and wouldn't publish or something? It's been a while so I don't remember the details but it was pretty clearly Taleb coyly describing how he couldn't take editorial criticism. There was also a lot of shit talking about sycophants, and then talk about how Benoit Mandlebrot was so smart that he thought Von Neumann was not that bright, and Mandlebrot likes Taleb so therefore Taleb's work must be super important. I don't think any of that falls under the category of being direct and blunt in making an intellectual argument. It's just extraneous ego-driven bullshit. The climate stuff is unrelated but worth making a short note on. The physics of climate change (not called that because it's less politically controversial, but because it's an umbrella term that describes a host of related phenomena that aren't solely an increase in temperature) are obviously complicated but not completely chaotic. As a professional (caveat emptor!) geoscientist I would phrase it that the longer-term changes are more linear but the shorter-term changes are less so, described quite nicely by you: "'Chaos' theory that lends exceptional stability to many phenomenon.' That being said, there is certainly a fair amount of stochasticity in the system but cutting carbon emissions by half (back to 1977 levels) just is not going to result in ice bulldozing Omaha. Really. It wouldn't be adding a new attractor, but it might be bringing one on a little more slowly. But then again I'm just Ozark trailer trash...
- wglb 10y agoI don't think any of that falls under the category of being direct and blunt in making an intellectual argument. It's just extraneous ego-driven bullshit I probably can't strongly disagree with that. And you are probably right about the fake novelist--it has been some time. Certainly Mandelbrot was one who got seriously delayed recognition for his contributions. As did Lorenz for his remarkable discovery that he couldn't get anyone to pay attention to. I don't disagree that both Mandelbrot and Taleb are/were arrogant. I would rather pay attention to someone who is arrogant and smart rather than arrogant and stupid. Your statement obviously complicated but not completely chaotic intrigues me. The reading I have done on the topic suggests that weather systems are to their core chaotic. I wonder if there is additional reading you can point to that suddenly cutting carbon emissions by half won't result in Omaha getting hammered. This conclusion does in fact seem to be the one that anti-climate-change-deniers have reached. The massive increase in carbon dioxide into the system is an impulse that seems to have moved the attractor in a scary direction. Why wouldn't a massive impulse in the opposite direction do the same? An engineer, not a climate scientist.