Author Archives: John

Dance With Chance – Making Luck Work For You


In a nutshell, Dance with Chance is all about knowing what you can and cannot predict and, therefore, what you can and cannot control.

Think about it. Every day human beings make decisions. Some are important: should you invest your life savings in the stock market? Others are trivial: should you take an umbrella today? But in both these cases you have no control. The stock market will go up or down, it will rain or it won’t… and there’s nothing you can do about it.

The problem comes when people seek to gain control by making predictions. By consulting an investment expert or a weather forecast, they think they can control the value of their investments or avoid getting wet.

But this is just an illusion. An illusion that psychologists call ‘the illusion of control’.

In many areas of life – the stock market and the weather are just two examples – accurate prediction just isn’t possible. There is always uncertainty about the future in most areas of our lives. Throw in some emotions, such as greed, fear and hope, and human beings’ predictions get even less accurate. So what are we to do?

Fortunately, Dance with Chance comes up with plenty of positive suggestions. Most importantly, it uncovers a ‘paradox of control’ that’s the antidote to the ‘illusion of control’. By knowing when to give up control, we can actually gain more control over many aspects of our lives than we had in the first place.

Dance with Chance: Making Luck Work for You Audio Only.

Nassim Nicholas Taleb – The Future Ain’t What It Used To Be

Nassim Nicholas TalebIf you want to be a dentist, it’s rational to assume that if you go to school, get your degree, and set up a dental practice, you will be able to attain a comfortable standard of living. You may be able to project your probable income range with some degree of accuracy.
But if you want to be a rock star, it’s irrational to assume that if you go to rock school, get good at guitar, and start a band, you will become rich and famous.
According to Nassim Nicholas Taleb’s way of thinking, the dentist and the wannabe rock star fall into two distinct categories with drastically different risk characteristics. The dentist falls into the domain he calls ‘Mediocristan’, and the rock star, ‘Extremistan’. Extremistan is dominated by ‘fat tails’, or rare but profoundly significant events. Problems arise when we think we’re operating in Mediocristan but in fact are operating in Extremistan.
“Karl Marx wanted to turn knowledge into action, what I want to do is turn our lack of knowledge into action”. Taleb suggests that by becoming aware of our own ignorance, we can stop taking action where our action is irrational.
I’m on my second reading of Fooled By Randomness and am very much looking forward to The Black Swan. In the meantime I’ve been hunting down all the audio I can find on Taleb because his talks are extremely interesting and he is a very engaging speaker. He has a bit of attitude when addressing an audience, in part no doubt because much of what he has to say offends of lot of people, especially anyone whose expertise is related to forecasting. He has obvious disdain for financial forecasters in particular, probably because he sees the impact these ‘guys in suits riding around in limousines’ have on the lives of ‘people taking the subway to work everyday’ (i.e.pensions).
What Taleb has to say has resonated with me at a very deep level. Much of the facts and studies he brings to light confirm my long lingering suspicion that something about the way the world sees itself is profoundly inaccurate and weirdly irrational.
I’ve listened to each of these talks at least a half dozen times and every time I do I take away another profound insight. Be sure to check out Taleb’s Home Page as well.
Taleb on April 30, 2007
LongNow Lecture-The Future Has Always Been Crazier Than We Thought Feb. 4, 2007