Home > Work > Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets
141 " The mechanism is a probabilistic method called conditional information: Unless the source of the statement has extremely high qualifications, the statement will be more revealing of the author than the information intended by him. "
― Nassim Nicholas Taleb , Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets
142 " What sounds intelligent in a conversation or a meeting, or, particularly, in the media, is suspicious. "
143 " Einstein’s remark that common sense is nothing but a collection of misconceptions acquired by age eighteen. "
144 " One needs to go out and buy a lottery ticket in order to win. Does it mean that the work involved in the trip to the store caused the winning? "
145 " Mathematics is not just a “numbers game,” it is a way of thinking. "
146 " If my brain can tell the difference between noise and signal, my heart cannot. Such "
147 " My problem is that I am not rational and I am extremely prone to drown in randomness and to incur emotional torture. I am aware of my need to ruminate on park benches and in cafés away from information, but I can only do so if I am somewhat deprived of it. My sole advantage in life is that I know some of my weaknesses, mostly that I am incapable of taming my emotions facing news and incapable of seeing a performance with a clear head. Silence is far better. "
148 " It is hard to resist discussion of artificial history without a comment on the father of all pseudothinkers, Hegel. Hegel writes a jargon that is meaningless outside of a chic Left Bank Parisian café or the humanities department of some university extremely well insulated from the real world. "
149 " A random series will always present some detectable pattern. I "
150 " There is one world in which I believe the habit of mistaking luck for skill is most prevalent—and most conspicuous—and that is the world of markets. By "
151 " I have anecdotal evidence in my business that MBAs tend to blow up in financial markets, as they are trained to simplify matters a couple of steps beyond their requirement. (I beg the MBA reader not to take offense; I am myself the unhappy holder of the degree.) "
152 " I am also realizing the nonlinear effect behind success in anything: It is better to have a handful of enthusiastic advocates than hordes of people who appreciate your work—better to be loved by a dozen than liked by the hundreds. This "
153 " In a now famous experiment they found that the majority of people, whether predictors or nonpredictors, will judge a deadly flood (causing thousands of deaths) caused by a California earthquake to be more likely than a fatal flood (causing thousands of deaths) occurring somewhere in North America (which happens to include California). As a derivatives trader I noticed that people do not like to insure against something abstract; the risk that merits their attention is always something vivid. "
154 " Monte Carlo (the old name for a roulette wheel) "
155 " Before the “enlightenment” and the age of rationality, there was in the culture a collection of tricks to deal with our fallibility and reversals of fortunes. The elders can still help us with some of their ruses. "
156 " Mathematicians of probability give that a fancy name: ergodicity. It means, roughly, that (under certain conditions) very long sample paths would end up resembling each other. The properties of a very, very long sample path would be similar to the Monte Carlo properties of an average of shorter ones. "
157 " Not only is it difficult for the journalist to think more like a historian, but it is, alas, the historian who is becoming more like the journalist. "
158 " The brilliant British mathematician, eccentric, and computer pioneer Alan Turing came up with the following test: A computer can be said to be intelligent if it can (on average) fool a human into mistaking it for another human. The converse should be true. A human can be said to be unintelligent if we can replicate his speech by a computer, which we know is unintelligent, and fool a human into believing that it was written by a human. Can one produce a piece of work that can be largely mistaken for Derrida entirely randomly? "
159 " The implication is that we feel emotions (limbic brain) then find an explanation (neocortex). As "
160 " We said that mere judgment would probably suffice in a primitive society. It is easy for a society to live without mathematics— "