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Nassim Taleb (Black Swan) open letter to David Cameron

guardian.co.uk

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Re: Nassim Taleb (Black Swan) open letter to David Cameron

#41

Post by katamole »

cia_plant wrote: post #40
jkuria wrote: post #34

Taleb needs to find something new to talk about. In his book Fooled By Randomness, he takes a paragraph and makes it a chapter. Takes a chapter and makes it a book, talking endlessly about black swans, how people who are successful are successful because they got lucky and repeating analogy after analogy to make the same basic point. In this post he makes sweeping statements about debt being bad, based on wisdom from…

Isn't it better to have one idea that is insightful and correct, than to have many ideas which are wrong, like most commentators?

Not when it keeps being rehashed ad nauseum.

Re: Nassim Taleb (Black Swan) open letter to David Cameron

#44

Post by bendtheblock »

jkuria wrote: post #34

Taleb needs to find something new to talk about. In his book Fooled By Randomness, he takes a paragraph and makes it a chapter. Takes a chapter and makes it a book, talking endlessly about black swans, how people who are successful are successful because they got lucky and repeating analogy after analogy to make the same basic point. In this post he makes sweeping statements about debt being bad, based on wisdom from…

It's a letter to the leader of the opposition and, potentially, the next primeminster. Taleb must be concise with his argument - it's not new to us because many of us have read The Black Swan or Fooled by Randomness.

I agree that commercial debt can be used for investment and is therefore useful. I think he is commenting on national debt. The problem is that the UK and US hold a magnitude of debt that will not be re-paid for several generations. Most of us would agree this is not healthy.

Further to this, his point about debt is that it is used to prevent the old institutions from failing and the resulting tax increases are hindering the next wave entrepreneurs. The financial crisis should have sped up the next wave of creative/destructive innovation in the financial sector but instead we are pretty much back to the status quo in The City and on Wall Street.

Re: Nassim Taleb (Black Swan) open letter to David Cameron

#45

Post by jacobolus »

cia_plant wrote: post #40
jkuria wrote: post #34

Taleb needs to find something new to talk about. In his book Fooled By Randomness, he takes a paragraph and makes it a chapter. Takes a chapter and makes it a book, talking endlessly about black swans, how people who are successful are successful because they got lucky and repeating analogy after analogy to make the same basic point. In this post he makes sweeping statements about debt being bad, based on wisdom from…

Isn't it better to have one idea that is insightful and correct, than to have many ideas which are wrong, like most commentators?

Isn’t being better than most commentators an awfully unambitious goal?

Re: Nassim Taleb (Black Swan) open letter to David Cameron

#46

Post by jpcx01 »

sh1mmer wrote: post #25

Having not read his book, was I the only person annoyed that he used the phrase "black swan" a dozen times in the first paragraph without qualifying it? He could have been saying "You and your party may be the only hope we have for a resilient society insulated from negative oranges and in which everyone has the opportunity to benefit from positive oranges." for all the difference it makes to me.

Ditto. I read his book, and liked it. But this letter seems to try to force the point a little much.

Re: Nassim Taleb (Black Swan) open letter to David Cameron

#48

Post by huntse »

cia_plant wrote: post #40
jkuria wrote: post #34

Taleb needs to find something new to talk about. In his book Fooled By Randomness, he takes a paragraph and makes it a chapter. Takes a chapter and makes it a book, talking endlessly about black swans, how people who are successful are successful because they got lucky and repeating analogy after analogy to make the same basic point. In this post he makes sweeping statements about debt being bad, based on wisdom from…

Isn't it better to have one idea that is insightful and correct, than to have many ideas which are wrong, like most commentators?

Well perhaps. So let's think about it. Black swans are not rare, they were thought to be completely impossible, and then people found them not to be impossible. So far maybe not so correct.

Secondly, regarding insight. This idea which everyone credits to Taleb is of course described all over the place. For example, as "the impossibility of inductive reasoning in the natural sciences" in The Mathematical Experience. As far as fat tails are concerned, every textbook on financial maths I own talks about fat tails the corrections that must be made to account for them, and they were all published before either of Taleb's books.

Re: Nassim Taleb (Black Swan) open letter to David Cameron

#49

Post by bwd2 »

joubert wrote: post #47

Before one gets hysterical, consider debt as a function of GDP. http://en.wikipedia.org/wiki/File:USDebt.png http://en.wikipedia.org/wiki/United_States_public_debt

Yeah, but the problem is that the rest of the world is not currently blown to smithereens and in need of American labor and capital to rebuild it the way it was in 1945 (not to mention deeply indebted to the United States as well). The trough of that graph is about the point where Western Europe and Japan managed to rebuild their economies to the point where they could actually compete effectively. The United States has no such competitive advantage at this point.

Re: Nassim Taleb (Black Swan) open letter to David Cameron

#50

Post by euroclydon »

cwan wrote: post #3
keven wrote: post #2

"Work on building a "robust" society, capable of withstanding errors, in which the role of finance (hence debt) would be minimal. We want a society in which people can make mistakes without risk of total collapse. Silicon Valley offers a good example, where people have the chance to fail fast (and repeatedly)."

Impressively scathing of both the Obama and former Bush administrations. I'm not sure how he would go about implementing some of his ideas since on one hand he argues against additional regulations and on the other he argues for a ban certain types of complex financial products (ie who would be the arbiter of what he calls a return to products that dependend on trial and error?). He is however a great writer and more…

"I'm not sure how he would go about implementing some of his ideas"

Mocking the young math-geek (I studied math) analysts, bankers, derivative creators or whatever their titles are, is a good start. I heard it somewhere that over the past decade or two, everyone's mom went from wanting their kid to be a doctor or lawyer to instead be a Wall Street I-banker. All we really need is for society to trust elaborate investment and debt schemes less.

I'm not sure if the moms had it right the first time though, because we have too many lawyers and doctors are taking a beating now from Obama,

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