Author: Nassim Nicholas Taleb is a Lebanese American philosopher, essayist, scholar, statistician and former derivatives trader, whose work mainly concerns problems of randomness, probability, and uncertainty. He defines himself as a “skeptical empiricist”.
Book: I strongly believe that it’s impossible to summarize any of NN Taleb’s books, thus, I will only present some, and only some, general ideas;
We constantly underestimate the role of randomness in our daily life, in business, and even in evolutionary theory! We overestimate causality and always look for explanations even when there is none. We should consider survivorship bias and the type of distribution before making choices (i.e. when selecting a portfolio manager). The idea of the Black Swan (and the more general problem of induction) is also presented, although it is discussed more profoundly in his next book of the “Incerto” series, The Black Swan (2007). Finally, he also explains many concepts brought up by behavioural “economists” such as Kahneman & Tversky.
Opinion: Mind-blowing book. Just fantastic. After reading it, I changed the way I used to see many things, from portfolio managers to newspapers or even prostitutes. Find attached some extracts I underlined for being interesting or funny. I enjoyed every chapter, especially the 7th, which referred to David Hume, Karl Popper and the problem of induction. Now three additional considerations:
1. This is Nassim’s first book, but not the best one (for me). If you are going to read all his books (the non-technical ones), start with this one. If not, just go to “Antifragile” .
2. You get convexity with any of Nassim’s books, that is, they get even better at the second (or third reading).
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