Chronicles Of Depression 2.0: #346: Taleb

I told you so: bankers are brainless

Taleb is in a state of considerable excitement. He is greatly in demand because his recent book, The Black Swan, includes a scathing attack on the financial system. For years he has railed against the banks – bad risks taken for the wrong reasons by incompetent people using bogus financial models. Any fool can say that now. Taleb saw it coming.

“The financial ecology is swelling into gigantic, incestuous, bureaucratic banks,” he wrote in The Black Swan. “When one falls, they all fall.” Taleb’s ideas, widely ridiculed by economists at the time, are being vindicated.

Emphasis added by me.

His book, Fooled by Randomness, is one everybody should read. It’s one of those rare books that is universal in thought and no matter what your particular interest, it can enhance your thinking about that and everything else.

I wish now I’d written to him when I first read it, shortly after it came out. It’s too late now. He’s mobbed.

But I absolutely love this guy. Some more quotes from this article:

Taleb’s writing is a passionate attack on several of modern society’s favourite ideas. First, expertise – “idiots in ties,” Taleb calls so-called experts.

He is suspicious of received wisdom. ‘We think we know infinitely more than we do. We used to think that mother’s milk was no better than bottled milk because we couldn’t find anything special in it. Now we know that Mother Nature knew better than us.”

Taleb’s contempt for self-reinforcing cabals of experts cuts across disciplines: “Academics are usually subhuman.” When my pen pauses and I look up, he adds: “You can say I said that – they are. Academia has nothing to do with producing knowledge. They produce PR. The four most important thinkers of modern history – Freud, Marx, Einstein, Darwin – none was a conventional academic.”

Emphasis added by me.

Sidenote: Who is trying to fix this global financial mess?

Bernanke: An academic!

Scared now?

More wonderfulness:

“When someone says he’s busy, he means that he’s incompetent,” says Taleb. Having a stupidly busy schedule isn’t a sign of being important. It means that you become insulated from the real world.

Emphasis added by me.

There’s lots of that around! (You think $400M-bonused Dick Fuld walked the streets of New York City? What? And risk ruining his Gucci loafers?!)


Understanding luck and randomness has practical benefits for us all. “Leave some space and time redundant,” Taleb says. “It’s good for dealing with black swans.” Like slack in the system? “Exactly. We all need slack. Capitalism doesn’t teach slack. It teaches optimisation – if the banks had had twice the capital, this crisis never would have happened.”

Emphasis added by me.

I haven’t read Black Swan yet. I don’t know if that’s in the book itself.

But what did I say on September 23 in Chronicles Of Depression 2.0: #225

And you’ll hear it here first now too: The bailout will FAIL.

They are applying old self-destructive greedy solutions to a problem that requires — for lack of a better business-y term — massive amounts of Slack.


This is not something any of them are prepared to give.

And since they want to keep holding tight, they will strangle to death the very thing they’re trying to save.

They are seeking a logical solution. This requires a stochastic solution.

Emphasis in original.

This is a man, you eejits:

The colourless conformity of corporate life appals Taleb: “Screw the money. No money can compensate for being turned into a rat in a cage.” In a typical piece of intellectual mischief, his next book describes how two of his fictional characters meet Socrates when the Greek philosopher visits the modern world. One of them predicts that Socrates will notice the absence of slaves. “Absence of slaves?” the second replies. “We’ve got plenty of slaves. You can identify them because they wear neckties.”

Emphasis added by me.

Master of the Universe Self-Delusion

He had talents equal to business, and aspired no higher.


And finally, here is a snapshot of Taleb’s home page, with red highlighting by me:

Click = big

Yeah: Screw your money!

Think of it! Greed, ignorance. All television and no literature — think! And now any one thing is good as any other. Why, I can remember when people used to fall helplessly in love. … Now these sons of bitches love their goddamn jobs, so-called, more than their goddamn wives!

— Lee, by Tito Perdue; pgs. 64-65

Screw. Your. Money.

At the old blog:

Overclock Your Mind

Explore posts in the same categories: Bank Collapse Watch, Books - Other, C.O.A.T. - Belief, C.O.A.T. - Money, C.O.A.T. - Politics, C.O.A.T. - Scams, C.O.A.T. - Self-Defense, Depression 2.0, Quantum, Reference - Life, Reference - Science, Science, Stock Market Crash Watch, Writers - Living, Writing

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