rss

Taleb's aphorisms

Just in time for holiday sales Nassim Taleb is back with what The New York Times dubs a “happily provocative new book of aphorisms,” The Bed of Procrustes. If you are among the unwashed who don’t understand the reference, “the Procrustes of Greek mythology was the cruel and ill-advised fool who stretched or shortened people to make them fit his inflexible bed.” It’s easy to understand why Taleb invoked this fool: “we humans, facing limits of knowledge, and things we do not observe, the unseen and the unknown, resolve the tension by squeezing life and the world into crisp commoditized ideas, reductive categories, specific vocabularies, and prepackaged narratives, which, on the occasion, has explosive consequences.”

The book is short and inexpensive. I will undoubtedly succumb and buy it even though it evokes mixed memories of exchanged aphoristic barbs with a titan in his (very different) field. Academic cleverness can easily turn ugly. But then why should the battles for intellectual capital be any different from those for other forms of capital?

NASSIM NICHOLAS TALEB AND THE BED OF PROCRUSTES- Quotes

Nassim Nicholas Taleb, the former trader and well known author of The Black Swan and Fooled By Randomness, has put together a new book of aphorisms, entitled The Bed of Procrustes.  The Procrustes of Greek mythology was a cruel fellow who stretched or shortened people to make them fit his inflexible bed. Mr. Taleb’s new book addresses the modern day ways in which “we humans, facing limits of knowledge, and things we do not observe, the unseen and the unknown, resolve the tension by squeezing life and the world into crisp commoditized ideas, reductive categories, specific vocabularies, and prepackaged narratives, which, on the occasion, has explosive consequences.”  In other words, we live under self-imposed delusions.  Here are a few of the aphorisms that expose our delusionary thinking, many of which can be applied to trading.  But, in order to understand their application, we must first step out of our delusional state.

The stock market, in brief: participants are calmly waiting in line to be slaughtered while thinking it is for a Broadway show.
You are rich if and only if money you refuse tastes better than money you accept.
The best test of whether someone is extremely stupid (or extremely wise) is whether financial and political news makes sense to him.
You can be certain that the head of a corporation has a lot to worry about when he announces publicly that “there is nothing to worry about.”
The main difference between government bailouts and smoking is that in some rare cases the statement “this is my last cigarette” holds true. (more…)

Go to top