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40 of 47 people found the following review helpful
5.0 out of 5 stars Exposes the Flawed Assumptions of the Bell Curve Nudists, Those Who Always Decide by Using Normal Distribution Models
Do you agree that being hit with a tsunami has a totally different effect from a normal high tide? If so, you'll be glad that Professor Taleb has decided to point out that all tsunamis (low probability, high impact events) need special attention, even if they occur infrequently. His advice: Minimize exposure to large potentially harmful events while taking maximum...
Published on Aug. 13 2007 by Donald Mitchell

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2 of 2 people found the following review helpful
3.0 out of 5 stars At first I wasn't sure I was going to get through the whole thing.
After reading the Black Swan I'm not really sure what just happened. At first I wasn't sure I was going to get through the whole thing. The prose is very different for a non-fiction-science-and-probability book. At least not what I was expecting. The book has small parts of memoir woven throughout, some of which seem to fit, others seem like filler, and others yet are...
Published on Aug. 25 2011 by Jeff Nijsse


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2 of 2 people found the following review helpful
3.0 out of 5 stars At first I wasn't sure I was going to get through the whole thing., Aug. 25 2011
This review is from: The Black Swan: The Impact of the Highly Improbable (Hardcover)
After reading the Black Swan I'm not really sure what just happened. At first I wasn't sure I was going to get through the whole thing. The prose is very different for a non-fiction-science-and-probability book. At least not what I was expecting. The book has small parts of memoir woven throughout, some of which seem to fit, others seem like filler, and others yet are probably over my head and just add to the confusion.

In the 3rd chapter Taleb tells a story about an obscure, unpublished novelist Yevgenia Krasnova and how the success of her novel was a highly improbable event'a Black Swan. Not having heard of this unique success story I put down my book and went to Amazon for more info. After a few minutes of unsuccessful searching in circles I kept reading only to find a footnote at the beginning of Chapter 3 telling me that Yevgenia is fictional!

This didn't sit well with me, especially because my internet search behaviour was predicted and footnoted on the very next page. I began to wonder what other sorts of liberties Taleb was going to take but I kept going because I didn't want to be the type of 'Sucker' Taleb talks about. (Yevgenia's character comes up again and I'm curious how purely fictional or perhaps partially autobiographical her character is.)

Taleb is clearly a very well read and studied man and is not shy about letting you know it. But through this self confidence (possibly arrogance) comes a very lively and passionate dissection of economics as a science and those in it's business, specifically market and economic theorists, traders, investment bankers, portfolio managers, etc.

It's great to read Taleb call out the Economics Nobel Prize committee. One section titled "More Horror" starts:

"Things got a lot worse in 1997. The Swedish academy gave another round of Gaussian-based Nobel Prizes to Myron Scholes and Robert C. Merton, who had improved on an old mathematical formula and made it compatible with the existing grand Gaussian general financial equilibrium theories'hence acceptable to the economics establishment."

It's not the easiest book to read through (the philosophical references come fast and furious) and Taleb's style is sometimes discontinuous, sometimes wordy, and sometimes longwinded, however, there are some great ideas in this book.

7 of 10 (which rounds down to 3 stars)

I'll definitely be reading Taleb's earlier book, Fooled by Randomness.
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40 of 47 people found the following review helpful
5.0 out of 5 stars Exposes the Flawed Assumptions of the Bell Curve Nudists, Those Who Always Decide by Using Normal Distribution Models, Aug. 13 2007
By 
Donald Mitchell "Jesus Loves You!" (Thanks for Providing My Reviews over 124,000 Helpful Votes Globally) - See all my reviews
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This review is from: The Black Swan: The Impact of the Highly Improbable (Hardcover)
Do you agree that being hit with a tsunami has a totally different effect from a normal high tide? If so, you'll be glad that Professor Taleb has decided to point out that all tsunamis (low probability, high impact events) need special attention, even if they occur infrequently. His advice: Minimize exposure to large potentially harmful events while taking maximum exposure to large potentially helpful events.

I was particularly thrilled to see that Professor Taleb points out the foolishness of economists in preparing theories without checking the data to see if the theories work in practice . . . the greater foolishness of the Nobel committee granting prizes for such work . . . and the greatest foolishness of relying on the advice of such economists.

Why all the fuss? Many phenomena display high predictability and the differences from the average usually don't make all that much difference to you and me (that quality is captured by a statistical display called a bell curve where most cases cluster near the average and vary symmetrically from the average). But in some cases, there are rare events that change the reality so strongly (like a tsunami can do on the negative side or a selection as an Oprah book of the month can do on the positive side) that it would be the height of foolishness to ignore the possibilities.

When it comes to assets, wealth, book sales, athlete pay, and lots of other places where there is lots of competition, there are geometric rewards for a few while the mass do poorly. These are long-tail events (the way statisticians talk about lots of variation from the norm). But almost all human decision making assumes that there is little variation from the norm.

The book concentrates on helping you understand why such a potentially harmful bias exists (brain structure plays a large role). We also assume a continuance of what's in front of us, even when there's obvious evidence to the contrary.

I was pleased to see these descriptions. I constantly run into the same problem with executives who are subject to stalled thinking and don't see opportunities right under their noses to accomplish 20 times as much. I liked Professor Taleb's points about overcoming our ignorance of antiknowledge . . . our tendency to discount what we haven't experienced or measured. I frequently see executives estimate that the best anyone will ever do at a level that someone already exceeded in 1880. In fact, in many important areas such as herbal health remedies, our actual knowledge is receding very rapidly, turning into antiknowledge.

To help break you free of how you think now, he uses a metaphor (a black swan -- is that really a swan?) and new terms (Mediocristan -- where the bell curve is the right way to think about things and Extremistan -- where powerful in effect black swans lurk). I found this tendency to be both helpful and not. It made it clearer to me what he was talking about the first time, and then made things seem muddier after that.

I suspect that for most people, the metaphor itself will be the biggest problem. Do you really care about black swans, per se? I don't. I think Professor Taleb would have done better to use two metaphors (one positive -- perhaps like formation and attraction of wealth to the Bill and Melinda Gates foundation and the foundation's effects on world health, and the other negative -- perhaps like a tsunami) than to focus on one that is mostly about definitions (black swan).

If you agree with Professor Taleb's main points, you will probably want to get lots of advice about how to do so. He's specific only in regard to two areas (wealth management and book publishing opportunities). That's a shame. Perhaps he will write a future book that will go more into solutions.

I was surprised to see that the book pretty much ignores the scenario work that many organizations use to identify the large impact, unlikely occurrence events and to devise strategies that work better under all possibilities. If that subject interests you, I suggest that you read books like The Art of the Long View and Inevitable Surprises by Peter Schwartz, Scenarios by Kees van der Heijdan, and The Irresistible Growth Enterprise by Carol Coles and me.

I was pleased to see that Professor Taleb also feels that many black swans can become "grey swans" by employing new prediction methods (although we cannot predict specifics, we can often predict up or down reasonably well in some situations). That has been my experience is seeing that Modern Portfolio Theory makes no sense in unsettled market conditions while more refined methods built stock-by-stock can be quite predictive over the short run in identifying over and under performers, even during unsettled market periods.

Check your models before you use them each day. Otherwise, you've just checked into work without your brains intact.

Keep your eyes and ears open whenever you are away from bell curves!
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7 of 9 people found the following review helpful
5.0 out of 5 stars The most important events in life cannot be predicted., May 22 2008
By 
Len (Slave Lake, Alberta, Canada) - See all my reviews
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This review is from: The Black Swan: The Impact of the Highly Improbable (Hardcover)
Taleb's primary thesis is that our lives are governed by black swans, the highly improbable, the circumstances that cannot be foreseen. A turkey will live its life in eager anticipation of the farmer who feeds it. In no way can it anticipate the day the farmer will decide to serve it for Thanksgiving dinner. Most of the world did not expect 9/11 or the impact it would have on their lives. J.R. Rowling could not have predicted the phenomenal success of her Harry Potter series. Mr. Taleb differentiates between those parts of our lives that are governed by mediocristan and those by extremistan. Mediocristan are those parts of our existence that fit a bell curve like who well we do on a test or our size relative to others or the time it takes to run a quarter mile compared to others. Variations from one person to another are limited by intelligence and physicality. Our income relative to others is governed by the laws of extremistan. It is not limited by any practical element. Knowing the income of one person gives no clue as the relative income of another if we take the example of me and Bill Gates or the average income of any 10,000 people if Bill Gates is included in that number. Mr. Taleb definitely provides another perspective on the world. One that's definitely worth reading.
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3.0 out of 5 stars Master of the Universe, Feb. 6 2012
By 
RondoReader (Fort Saskatchewan, Alberta Canada) - See all my reviews
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This review is from: The Black Swan: The Impact of the Highly Improbable (Hardcover)
Mr. Taleb is disagreeably enamoured with his own intellect and rather disdainful of that of the rest of us. He presents as the living embodiment of the "Master of the Universe" persona depicted by Tom Wolfe in "Bonfire of the Vanities." Apparently such massive egos really do exist.

I suppose Mr. Taleb deserves kudos for tackling a topic, probability and statistics, which is most easily described in mathematical terms without once resorting to mathematical formulae and for minimizing the use of figures and graphs but any benefit is quickly nullified by Mr. Taleb's opaque writing style and his tendency to wander off into unrelated side issues. That wandering feels suspiciously like padding.

Happily, arrogance and abstruse writing does not mean Mr. Taleb is incorrect or does not have something important to say. He does. His main point, that the Gaussian (or Bell) Curve is overused which leads to damaging errors, is well taken and we can all profit from the knowledge. Plus there are a few other nuggets such as his discussion of common shortcomings in critical thinking. I might have nudged my rating up to four stars if Mr. Taleb had managed to include a few concrete examples of applying his black swan model to real, everyday situations but, alas, with one or two exceptions, they are conspicuously absent; surprising, perhaps, from an author claiming to be a "bottom-up" sceptical empiricist.

I wish I could recommend an alternate author or book that covered Mr. Taleb's topic more agreeably but I can't. Proceed with caution.
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15 of 21 people found the following review helpful
5.0 out of 5 stars Compelling and radical thinker, Oct. 30 2007
This review is from: The Black Swan: The Impact of the Highly Improbable (Hardcover)
This is one of the titles that you shakes you by the limbs with intelligence and radical thought processes. Taleb has serious disagreements with MBA's and PH'Ds in psychology, business, finance, and socialogy, in that one cannot assume the data they study in the past can be projected forward and analyzed with the same tools.

In finance, the market is not static, and the business cycle and stock market cannot use normal distributions and curves based on time, because innovations, be them technical, financial, technological have no standard dynamics or predictable market reactions. By its very nature, the flow of dollars is unpredictable by the market participants, and the news is more propaganda than crystal ball accurate.

On the very inside of Wall Street, there are many super wealthy who will wait with infinite patience, and react with swift big bucks to take advantage of the uncertainties before John Q. Public has the slightest hint of what is really going on, and before he has the chance to adjust his portfolio. Taleb feels this is where the real players of the world navigate with tremendous results.

On a side note, if you happen to be rich and single, also pick up the best seller in the asset protection category, which doubles as a very funny dating guide, called The Professional Bachelor Dating Guide - How to Exploit Her Inner Psycho.

The Black Swan has very brilliant theories and thought packed on every page. Get it and rattle your brain some.
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3 of 5 people found the following review helpful
5.0 out of 5 stars A great book by a somewhat arrogant writer..., March 7 2010
By 
Vangel Vesovski (Mississauga, ON Canada) - See all my reviews
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This review is from: The Black Swan: The Impact of the Highly Improbable (Hardcover)
Let me begin this review by noting that Nassim Taleb is the type of author who evokes strong responses in most individuals. You either love his work or hate it. What I find interesting is that the response tells us far more about ourselves than about Taleb's books.

It is easy to understand why The Black Swan is such a huge best seller. The book is written in a very engaging style and includes very interesting narratives that are full of powerful images and interesting subjects. Taleb writes about such topics as scalability, confirmation errors, epistemic arrogance, the ludic fallacy, Mandelbrodtian randomess, Extremistan, Mediocristan, the fallacy of silent evidence, narrative fallacies, Platonic folds, randomness and (as) incomplete information, future blindness, etc.

Taleb points out to his readers that the world is a far different type of place than they imagine it to be. To this end, Taleb brings out two Weberian Ideal Types: Mediocristan and Extremistan. They are 'utopian' places that are defined by the idea of 'non-scalability' or 'scalability.' Taleb points out that we have non-scalability when the consequences of an action or activity are dependent on the efforts that are used. He notes that the compensation of a Doctor, Lawyer, or call girl is not scalable because it depends on the time available to the individual providing the service. On the other hand, a painter, composer, or author can produce returns that are unconnected to the quantity of effort. A Picasso sketch can sell for a few million dollars even though the artist may have taken a few minutes to create it. But the work of another painter who took months to complete it may not sell for $50. The art world does not care how much time went into producing a work because its value has little to do with the labour or materials that went into producing it.

In Mediocristan, nothing is scalable. Output and rewards are constrained by time, boundary conditions, and other factors too numerous to mention. It is a place which is dominated by random variation and can be adequately described by Gaussian probability models. In such a well ordered world no single value can have a large affect on the distribution that we are looking at. If we are looking at the average weight, height, or hat size of an adult, an extreme outlier will not have a material effect on our result. Think of a sample of 1,000 randomly selected adults that gets a sumo wrestler being selected as the 1001st addition. The fact that the sumo wrestler is much heavier than average will not be meaningful to the calculated mean.

Things are very different in Extremistan where variations within distributions are not as constrained. It is the place where scalability dominates and actions produce distributions that can frequently have extreme values. Those extreme values will often affect the total of attribute values and the mean in a sample distribution. In that world the probability of observing extreme events is much greater than what is seen in the typical Gaussian models that are adequate for describing Mediocristan. While it is easy to use to use Gassian distributions to describe adult weight, height, hat size, mortality rates, etc., they cannot be used to describe distributions of income, wealth, film sales, etc.

Taleb points out that we live in both worlds but try to apply the distribution models of Mediocristan to try to predict what happens in Extremistan. In our weight example we saw that the addition of a sumo wrestler did little to our mean and distribution. That is a perfect example of how Mediocristan works. But if we change that to wealth and add a Bill Gates or Warren Buffett as our next data point to our sample we see that both the mean and distribution change significantly because either man has more than a million times the wealth of our 'average' individual. That is what makes Extremistan so different.

The problem arises when individuals try to use a model of Mediocristan to describe the social and economic spheres, where the models are not applicable and have never been applicable in a human society. In modern human societies power law distributions are dominant in the social sphere so it is not usual to see most of the income, wealth, and power be concentrated in the hands of a few. It does not matter if the society is socialist, fascist, democratic, or a limited government republic.

Most harm is done when people and professional forecasters, who know far less than they think that they do, are fooled by randomness and use the wrong probability models to predict outcomes. The problem is that most of the people who are considered 'experts' cannot deal with the real world distributions in the social sphere and wind up making assumptions that are only suitable for the physical world. They come up with all kinds of models that bring them undeserved fame and prestige. As Taleb points out, most of the Economics Nobel Prizes have gone to idiots who got the story wrong and came up with models that do much more harm than good. And this is where Taleb crosses the line and angers many readers who do not want to hear his message. Most people are comfortable with the way things are and do not want to see their cherished myths exposed by a rational review of the facts. They are particularly angered when Taleb makes it clear that he is well aware of his considerable intellect and that he is much smarter than his average reader. That arrogance does not play well with many readers and more than a few are likely to rate his book poorly even though it is one of the best books that one could hope to read on the subjects that are covered in its pages.

My advice is to look into the mirror and figure out what kind of person you are before you buy the book. If you don't have the time or energy to read the book carefully, or like your view of the world as it is and do not wish it to be challenged then stay away. But if you have an open mind, like to have your views challenged, have no problem working through a few difficult passages that may require you to do some additional reading, and love well written material by an author who brings knowledge of many subjects, than this book is for you. Good luck. I hope that you make the right decision.
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0 of 1 people found the following review helpful
5.0 out of 5 stars This Book Altered my View of the Financial Industry., March 10 2009
By 
James DiCenzo (Dundas, Ontario, Canada) - See all my reviews
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This review is from: The Black Swan: The Impact of the Highly Improbable (Hardcover)
Although some might find the book perhaps too theoretical in nature, in my business, his approach is quite practical. Being in the finance industry, Mr. Taleb's views and opinions certainly altered my view of the overall state of North America's financial markets.

In a recent interview, Mr. Taleb said that in his opinion, the real Black Swan will be if we come out of the current financial crisis unscathed. If you want to find out the probability of that happening, this book should be of interest to you.
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3 of 6 people found the following review helpful
4.0 out of 5 stars Living Betwix and Between, Feb. 23 2008
By 
Ian Gordon Malcomson (Victoria, BC) - See all my reviews
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This review is from: The Black Swan: The Impact of the Highly Improbable (Hardcover)
Most of us are content to live within the parameters of what we think we know about our environment. Our safety zone is found between what we know for certain and what we can never be quite sure of. Into this midst Taleb drops a bombshell in the form of the Black Swan, a coined term describing the element of the highly unlikely or improbable. It is this less than two-percent chance of the unexpected that requires the individual to be skillful anticipating possible success or failure. As humans we live between either too narrow an existence where are no risks, hence no rewards, and a too wide-open domain, where risks are the order of the day. Taleb's book offers a lot of commonsensical tips on how to manage the zone that exists between these two popular extremes of all or nothing. Some of them involve understanding statistical odds, randomness, diversification, and volatility; all of these contain the potential for being deadly Black Swans. What I found especially helpful in the book was Taleb's way of backing up all his philosophical observationsand arguments with evidence from the scientific world. For him, it all comes down to the fact that in order to be successful we must able to manage the area of uncertainty in our lives by developing plans that allow for latitude and flexibility. In a nutshell that means attacking the unknown by intelligently and prudently enlarging our boundaries so that it doesn't close in on us and choke of our very existence.
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5.0 out of 5 stars Five Stars, Sept. 7 2014
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This review is from: The Black Swan: The Impact of the Highly Improbable (Hardcover)
Fun to read
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0 of 1 people found the following review helpful
5.0 out of 5 stars The Black Swan: The Impact of the Highly Improbabl, June 25 2009
By 
Joe Ralko "Dad of Six" (Regina, Canada) - See all my reviews
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This review is from: The Black Swan: The Impact of the Highly Improbable (Hardcover)
I was pleasantly surprised how readable the book was. Taleb has broken his theory into bite size, edible food for the brain that made the book easy to follow, put down when family time took priority in my life and just as easy to pick up again because of the modular format.
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The Black Swan: The Impact of the Highly Improbable
The Black Swan: The Impact of the Highly Improbable by Nassim Nicholas Taleb (Hardcover - April 17 2007)
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