Oprah Time: The Black Swan: The Impact of the Highly Improbable by Nassim Nicholas Taleb
Originally published at renaissancechambara.jp on June 12, 2016. It’s been nine years since Taleb wrote The Black Swan. Like Francis Fukuyama’s The End of History and the Last Man before it, The Black Swan is widely cited and paid lip service to.
The timing of publication for Taleb was particularly pertinent as the book became popular as the financial system broke down in 2008. Some eight years later, the economy has limped along as financial issues were punted into the future, rather like a child kicking a can down an alley. Like the can, the financial issues are still here to be ran into. I thought it was time to re-read Taleb’s book.
Taleb’s work is philosophical rather than scientific in its method. Although he avoids the talk show friendly cliches of Malcolm Gladwell or Seth Godin. Much of our world is based around the normal distribution, it is used by insurance companies and pension funds to access risk and longevity. Taleb points out that the really big changes that rock the boat often don’t fit neatly within these models.
Taleb’s solution boils down to two things
- A defensive skepticism that would encourage the average person to question common wisdom and ask ‘what if’
- For those that can afford it, an offensive posture that asks ‘what if’ and has a mix of savings or investments most of which is put in very safe vehicles and 15 per cent or so on high risk speculative investments to take advantage of change
Taleb’s work doesn’t seem to have had the impact that one would have expected just five years ago when it was quoted as a touchstone to modern life.
Much of the excess and risk that had happened previously is happening again, despite a plethora of disruptive forces laid out in the media.
Audiences are paying too much attention to listicles that go something along the line of ‘5 habits you need have to be like Bill Gates’. Where is the critical filter?
McMansions Are Back And Are Bigger Than Ever — There was a small ray of hope just after the Lehman collapse that one of the most lamentable characteristics of US society — the relentless urge to build massive McMansions (funding questions aside) would have subsided
The market’s most crowded trades could be causing dangerous bubbles — Business Insider
Many Middle-Class Americans Are Living Paycheck to Paycheck — The Atlantic
Economic Conditions Snapshot, March 2016: McKinsey Global Survey results | McKinsey & Company
Andy Grove’s Warning to Silicon Valley — The New York Times — Mr. Grove contrasted the start-up phase of a business, when uses for new technologies are identified, with the scale-up phase, when technology goes from prototype to mass production. Both are important. But only scale-up is an engine for job growth — and scale-up, in general, no longer occurs in the United States. “Without scaling,” he wrote, “we don’t just lose jobs — we lose our hold on new technologies” and “ultimately damage our capacity to innovate.
Crap IT means stats crew don’t really know how UK economy’s doing • The Register — and people make accusations about Chinese economic data…
Return of ‘100% mortgages’ ease burden on Bank of Mum and Dad | FT