Real life vita beata is when your choices correspond to your duties and vice versa.
via Real life vita beata is when your choices… – Nassim Nicholas Taleb.
Real life vita beata is when your choices…
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The Lucretius Problem
Floods in England are simply from the Lucretius Problem, believing that the worst future flood equals the worst past one (Antifragile).
(Corollary) If you socialize with someone with a smaller bank account than yours…
(Corollary) If you socialize with someone with a smaller bank account than yours, you are obligated to converse exactly as if you had the same means, eat in the places where he normally eats, at no point in time show the pictures of your vacation in Provence or anything that hints at the differential in means.
via (Corollary) If you socialize with someone with a… – Nassim Nicholas Taleb.
Do not socialize with people much richer than you; but if you do…
Do not socialize with people much richer than you; but if you do, do it in your own territory (restaurants you can afford, wine, etc.)
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(As the tribe might have noticed, I am adding a list of 99 prescriptive heuristics, with rationalization, as a short standalone addition to the INCERTO).
via Do not socialize with people much richer than… – Nassim Nicholas Taleb.
Would-be Error Detectors: Suit Up | AllAboutAlpha
Taleb writes thus: “Many have the illusion that ‘because Kolmogorov-Smirnov is nonparametric’, it is therefore immune to the nature specific distribution under the test….”
What does that mean? The Kolmogorov-Smirnov test is a standard measure of how a certain data sample compares with a reference probability distribution. It focuses on the largest observed distance between the actual set and the corresponding figure in the referenced distribution. If the largest observed distance is acceptably low, then presumably the one is acceptably conformable to the other. This test is widely said to be “non-parametric,” which in this context means that it is free of question-begging assumptions.
So what Taleb contends here is that the nonparametric nature of that test is an illusion. This is part of his effort to discredit patch-up jobs. In his view, Kolmogorov-Smirnov is one of many ways in which quants persuade themselves that they at last have a fix on how fat those fat tails can really get. If true, this would allow the quants to return to their pre-crisis mechanical ideas about risk management. But it isn’t, and they shouldn’t.
Or, as Taleb puts it at his most eloquent, “Shkmolgorov-Smirnoff.” Though I’m not sure I could manage the pronunciation of that.