For fat tailed distributions, the empirical distributions does not reflect the true statistical properties, particularly for extremes. This is a simplified side note to a paper with Mark Spitznagel on why people make a mistake by looking at raw historical data as “empiricism”.

So I am fed up with academics who say “we know it is fat tails” yet not understand the consequences.

Nassim Taleb’s Probability Moocs: The empirical distribution is … not empirical

Posted on

June 12th, 2017

Category

Academic, MOOCs, Videos

I will always remember my encounter with the writer and cultural icon Susan Sontag, largely because it was on the same day that I met the great Benoit Mandelbrot. It took place in 2001, two months after the terrorist event, in a radio station in New York. Sontag who was being interviewed, was pricked by the idea of a fellow who “studies randomness” and came to engage me. When she discovered that I was a trader, she blurted out that she was “against the market system” and turned her back to me as I was in mid-sentence, just to humiliate

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Medium Post: The Merchandising of Virtue

Posted on

May 29th, 2017

Category

Writing

This tutorial presents the intuitions of the randomness of sample correlation (spurious correlation) and the methodologies in derivations. Some later sections are somewhat technical as Nassim rederived an old equation with more precise functions (in order to apply to fat tails) and showed the distribution of the maximum of d variables with n points per variable. This paves the way to the real scientific work on random matric theory under fat tails and the failure of Marchenko-Pastur.

Randomness of Correlation & Its Hacking by Big Dataists

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May 24th, 2017

Category

Academic, MOOCs, Videos

An interview of Nassim by Bloomberg TV at the SALT Conference. Nassim explains what people aren’t getting about President Trump, then discusses tail hedging and the current risks in the environment.

Nassim on Bloomberg News

Posted on

May 24th, 2017

Category

Politics, Videos

One of the problems of the interventionista –wanting to get involved in other people’s affairs “in order to help”, while genuinely wanting to do good, results in disrupting some of the peace-making mechanisms that are inherent in human’s affairs, a combination of collaboration and strategic hostility. As we saw in the prologue, the error continues because someone else is paying the price.

I speculate that had IYIs (intellectuals yet idiots) and their friends not gotten involved, problems such as the Israeli-Palestinian one would have been solved, sort of –and both parties, especially

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Medium: Peace: Neither Ink nor Blood

Posted on

May 4th, 2017

Category

Academic, Writing

Skin in the Game is necessary to reduce the effects of the following divergences that arose mainly as a side effect of civilization: action and cheap talk (tawk), consequence and intention, practice and theory, honor and reputation, expertise and pseudoexpertise, concrete and abstract, ethical and legal, genuine and cosmetic, entrepreneur and bureaucrat, entrepreneur and chief executive, strength and display, love and gold-digging, Coventry and Brussels, Omaha and Washington, D.C., economists and human beings, authors and editors, scholarship and academia, democracy and governance, science and scientism, politics and politicians, love and

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Medium Post: On Interventionistas and their Mental Defects

Posted on

May 4th, 2017

Category

Academic, Writing

Writing for Family Capital, David Bain talks about the Lindy Effect, as elaborated upon by Nassim, in terms of family businesses and their longevity.

Could something called the Lindy Effect help to understand why family businesses often survive for so long? Possibly – but one thing is for sure, the Effect offers an intriguing explanation for why some businesses survive longer than others.

The Lindy Effect says that the observed lifespan of a non-perishable item like a business is most likely to be at its half-life. So, if a business is 100 years old, it should expect it to be

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The Lindy Effect and Family Businesses

Posted on

April 11th, 2017

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Uncategorized

You who caught the turtles better eat them (Ipsi testudines edite, qui cepistis) goes the ancient adage.

The origin of the expression is as follows. It was said that a group of fishermen caught a large number of turtles. After cooking them, they found out at the communal meal that these sea animals were much less edible that they thought: not many members of the group were willing to eat them. But Mercury happened to be passing by –Mercury was the most multitasking, sort of put-together god, as he was

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Medium Post: Why Each One Should Eat His Own Turtles: Equality in Uncertainty

Posted on

April 11th, 2017

Category

Writing