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Interesting but flawed....Scotty79: to argue that models cannot be blamed for market crashes is the same type of argument that says guns don't kill people. Both
by cjbenedikt 14y ago
Interesting but flawed....Scotty79: to argue that models cannot be blamed for market crashes is the same type of argument that says guns don't kill people. Both statements outside context are correct, yet...btw: another academic created the option formula already: Vincent Brontin who taught in Triest in 1910...and not the physicists who knew howcto treat formulae appropriately survived the crashes but street smart traders like Taleb did...experienced option traders never used Black-Scholes anyway because they knew it was flawed...an accident waiting to happen...
- barry-cotter 14y agoTaleb's fund failed.
- yarou 14y agoAnd? That makes his point about ridiculous risk models no less valid.
- cjbenedikt 14y agoactually it didn't ...its successor Spitznagel's Universa made enormous profits in 2008 to the tune that he now manages $6 billion....also: Taleb made his money in the '87 crash...and Empirica made a lot in 2000/2001. Taleb closed it because he suffered from trader fatigue....something quite common btw