Nassim Taleb Makes Billions and Attacks Richard Dawkins

My $.02 on NT:

I own 2 of his books (swan and fooled), and in my mind he deserves plenty of credibility for being a sound thinker, a competent articulator and interesting analogist.

I am sure that some of his net worth comes from book sales. I am also fairly certain than he made some jack in ’87. $50M sounds ridiculous. Maybe for First Boston, but not for himself. I guess he hit is big on a large ootm call position on the Eurodollar when the fed opened up the floodgates in late’ 87. That must have been one big position…

I think he had a clear view of some of the things that were going wrong with risk management, good insight into human nature and how we fool ourselves. Last, but not least, he had a good idea of the plausible extent of the fallout, once the leverage/risk shoe dropped.

Many of us had the exact same thoughts about risk, the “upside” versus “downside” of being a bank, and the “envelope of serendipity,” as he so nicely put it. However most of us (and I think this includes NT) weren’t able to get the timing right on it this last go-round. I think NT admits himself that you can be 100% right on an issue and still blow up because you enter your position too early.

Anyway, I would be interested to know the name of the Fund that he supposedly made billions for in 2008.

P.S.: I’ve read pieces of his vanilla options work, and there’s no doubt that the man can apply some math…
 
I'm not sure about your definition of black swan. Having actually taken several lectures from him at NYU, I'm pretty sure he meant black swans as improbable events that are usually too remote to hedge, not un-imaginable.

His point is, I believe, before you actually see a black swan, you have little basis in believing that it exists; It's that information barrier that he's concerned about, not whether some one thought it might exist.


Quote from Cutten:

I agree. So far he has not given a single example of a true Black Swan in the markets. Nor has anyone else I am aware of. It is possible there are not even true Black Swans in *any* area of life. For example, an alien invasion is not a Black Swan, plenty of people think it is possible even though they would say the probability in any given year is low. Ditto for a global pandemic killing half or all of the population, the sun exploding, nuclear armageddon, a giant asteroid hitting earth and causing human extinction etc etc. All these things are known as possibilities, so by definition they can't be Black Swans. A true Black Swan would be something like the earth disappearing instantly for no known cause - basically something radically outside the "laws" of science/physics.

One must also assume that at least one human being imagined the possibility of actual black swans too, before they were discovered. So even his metaphor is flawed. He should have called it the Chromatic Yeti.
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Quote from texrex2002:

My $.02 on NT:

I own 2 of his books (swan and fooled), and in my mind he deserves plenty of credibility for being a sound thinker, a competent articulator and interesting analogist.

I am sure that some of his net worth comes from book sales. I am also fairly certain than he made some jack in ’87. $50M sounds ridiculous. Maybe for First Boston, but not for himself. I guess he hit is big on a large ootm call position on the Eurodollar when the fed opened up the floodgates in late’ 87. That must have been one big position…

I think he had a clear view of some of the things that were going wrong with risk management, good insight into human nature and how we fool ourselves. Last, but not least, he had a good idea of the plausible extent of the fallout, once the leverage/risk shoe dropped.

Many of us had the exact same thoughts about risk, the “upside” versus “downside” of being a bank, and the “envelope of serendipity,” as he so nicely put it. However most of us (and I think this includes NT) weren’t able to get the timing right on it this last go-round. I think NT admits himself that you can be 100% right on an issue and still blow up because you enter your position too early.

Anyway, I would be interested to know the name of the Fund that he supposedly made billions for in 2008.

P.S.: I’ve read pieces of his vanilla options work, and there’s no doubt that the man can apply some math…
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per the article, the fund is named "black swan fund"

i chatted with NT couple years ago. he advised that he bought so many books he single handily supported a borders store--- tongue in cheek im sure, but funny none the less...
 
Quote from texrex2002:

... he deserves plenty of credibility for being a sound thinker, a competent articulator and interesting analogist.
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Yeah, but how about as a trader? After all every theory is just as good as it can be used in real life....
 
He made bank before he wrote his books as an options trader. Then, he had his hedge fund which did fairly well. So, it's hard to call him a hack judging by his performance.

Unless you narrowly define "trader" as someone who has to trade every few minutes to make a living, it's hard to make a case that he isn't a decent one.

Quote from Pekelo:

Yeah, but how about as a trader? After all every theory is just as good as it can be used it in real life....
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Quote from sjfan:

He made bank before he wrote his books as an options trader.

But did he use the "black swan OTM putbuying" strategy back then??? I was refering to this idea/strategy.

Then, he had his hedge fund which did fairly well.

If by fairly well you mean it was closed down because it slowly was bleeding to death.
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I'm reasonably sure that his strategy wasn't to just buy otm put.

Sorry, his hedge funds shut down because of poor performance? that's news to me: http://lawandmore.typepad.com/law_a...ans---talebs-hedge-fund-up-65-to-115-oct.html

Furthermore, I'd hesitate to call his book a strategy book. It's more of an intersection between portfolio management, theoretical statistics, and epistemological philosophy. No where in his books (or his lectures, or talks) did he say "you should trade like so and so"

Quote from Pekelo:

Quote from sjfan:

He made bank before he wrote his books as an options trader.

But did he use the "black swan OTM putbuying" strategy back then??? I was refering to this idea/strategy.

Then, he had his hedge fund which did fairly well.

If by fairly well you mean it was closed down because it slowly was bleeding to death.
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i am certain there is a plethora of investors who didnt get what they expected in empirica, so they come here spreading innuendo and rumours of falsehoods with no proof of their own statements. suggest paying them no mind and sticking to facts....

surf
 
Is a spectacular fall from grace in the cards??

NT is making the VN ego appear downright puny.


As they say about hubris, back to the beach, carry on....

surf:D

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