Q&A, Excerpt of OWP 2010 Evening Session with Nassim Nicholas Taleb – Author of the international bestseller The Black Swan. We live in a complex system that delivers extreme deviations. Current risk management and economic analyses methods fail us in such a system because of low predictability. What should we do in such an environment? In this evening session, Taleb will present simple rules (lower leverage, less reliance on deficit spending, less mathematical risk management) for a black swan robust economic system.
NASSIM TALEB: The governments have transformed private debt into public debt. Now, that’s not something very commendable, because your grandchildren — and I know you have grandchildren — your grandchildren and their children will bear the price. This is immoral.
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Tagged bell curve, dave lull, fat tails, inflation 'tax', nassim taleb, Nouriel Roubini, Paul Solman, PBS, private liabilities to public debt, recession, Video
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Airtime: Thurs. Jun. 10 2010 | :30:0 10 ET “We have no other solution but to slash debt,” Nassim Taleb, author of ‘The Black Swan’, told CNBC Thursday. He discusses the outlook for the global economy with Bob Long, CEO, Conversus Capital. Summary from Huffington Post: Author and New York University professor Nassim Taleb [...]
NNT enters the conversation around 5:45 NYU-POLY is the school NNT chose to teach at.iatrogenics http://en.wikipedia.org/wiki/Iatrogenics Interview with Morton L. Topfer Distinguished Professor and Department Chair Charles S. Tapiero and Distinguished Professor Nassim Nicholas Taleb .Also on Facebook: www.facebook.com/video/video.php?v=396575527762
For the inaugural video in the New Yorker Currents series, Nassim Nicholas Taleb talks with James Surowiecki about the causes of the 2008 financial crisis and the future of the economy. Read more: http://www.newyorker.com/online/blogs/newsdesk/2010/06/video-currents-nassim-nicholas-taleb-james-surowiecki.html?utm_source=twitterfeed&utm_medium=twitter#ixzz0q9XOjFYM .
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Tagged austerity measures, Continental Illinois, debt bubble, eliminate complex derivatives, eliminate moral hazard, get rid of debt, grey swan event, James Surowiecki, moral hazard, Nassim Nicholas Taleb, nature restrains size, New Yorker, redundance, S&L bailout, the black swan
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Why do we not acknowledge the phenomenon of black swans until after they occur? Part of the answer, according to Taleb, is that humans are hardwired to learn specifics when they should be focused on generalities. We concentrate on things we already know and time and time again fail to take into consideration what we don’t know. We are, therefore, unable to truly estimate opportunities, too vulnerable to the impulse to simplify, narrate, and categorize, and not open enough to rewarding those who can imagine the “impossible.”
I was a trader for 21 years, and anyone taking markets seriously needs to consider the following… You remember the day when Kervial was liquidated? The SocGen rogue trader… ‘the hero’ in France. They sold $50 billion dollars worth of stock. How much did capitalization drop world-wide, based on that? Markets went down 12 percent! With a $50 billion order, you drop markets by 12%. We lost 7, 8 Trillion. A huge amount. So it tells you, don’t pay attention to stock markets. They’re driven by the marginal buyer. It means nothing. Short term markets mean nothing.
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Tagged Anil Gaba, bernanke, cash for clunkers, converting private debt to public debt, debt to equity, deleveraging, Geithner, Kervial, nassim taleb, Nouriel Roubini, rewarding failure, short term markets mean nothing, Summers, the risk is still there, Volcker Rule, who got us here
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When it comes to economic life, we have evidence that a cab driver knows as much as a political scientist-anyone in Washington- in what’s going to happen tomorrow.
People tend to fit their beliefs to the profession, rather than fit their professions to their beliefs…
…when people’s income depends on certain set of beliefs, they will endorse these sets of beliefs, just for the sake of maintaining their lifestyle.
HatTip to Dave Lull. ai5000 interviews Nassim TalebThis is a link to the streaming video (which wasn’t playing very well the day I discovered it. Just added the YouTube links). So I made an audio recording of it. You’ll hear a few skips and pops and the last few seconds of the video wouldn’t [...]
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Tagged ai5000, Audio, avoid clustering, cash, collection of currencies and metals, etfs, Investing, low leverage, mediterranean real estate, Nassim Nicholas Taleb, over-insured, rare events, robustness
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