Appraisal of The Black Swan from Nassim Nicholas Taleb

From the man who brought to us ‘Fooled by Randomness’ comes another epic, sweeping masterpiece that is guaranteed to change the way you think – The Black Swan! Nassim Taleb is back with this stunning intellectual work on probability theory, philosophy, psychology and epistemology!

This famous quant trader, financier, philosopher and pseudo-psychologist explores the Black Swans – the ‘highly improbable’ events that leads to massive consequences. Taleb begins the book with the story of mankind’s discovery of black swans on earth. Some time ago our not-so-distant ancestors thought that all swans are white, because it has been empirically observed in all known lands that the swans are all white. Until one fine day the discovery (from the perspective of the Europeans) of Australia led to the observation of a black swan. Surprise! The notion of all swans being white has to be discarded and all scientific records updated. This is the typical ‘Black Swan’ event that Taleb coins – an event thought to be highly improbable but with massive consequences.

Taleb brought up further examples of Black Swan events like the rise of Hitler, the breakup of the Soviet Union, the rise of Islamic Fundamentalism, the September 11 Attacks. All of them bearing massive consequences to the world and yet once deemed to be highly improbable. Taleb also leads a polemic against the Gaussian Theory (Bell Curve/Normal Distribution) and the use of it in risk management plans. He adopts an interesting approach based on what he calls himself: ‘an empirical skeptic’

Taleb also warns us with how we deal with our acquired knowledge. Have an antilibrary (library with books not read) and antiknowledge. We should be focused on what we do not know rather than what we know and what we specialize in. He talks about epistemic fallacies (ludic, narrative) and what he calls ‘tunneling’ and how these are unavoidable; being inherent in our human natures, and how these would lead to us being unaware of Black Swans.

An epic masterpiece that touches everything from Medicine to History, from Cicero to Bertrand Russell, from Mandelbrot and Gauss to Henri Poincaré. A book that would challenge your presumptions and academic assumptions, and a book that would help you remain a critical thinker in this society drowned with opinions popularized by the media. Read it!

Ferdinand’s Rating: 4.5/5

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1 Comment

Filed under Business, Economics & Finance, History, Philosophy

One response to “Appraisal of The Black Swan from Nassim Nicholas Taleb

  1. Zwhale

    Yeah, a superb book. I’d give it 5/5!

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