Book Review – Black Swan by Nassim Nicholas Taleb

Academic, Irreverent but very Relevant

Well, this one blew me away. Non fictions generally don’t do that to me. Since they state facts,  or at max hypothesis, they can at best be beautiful, such as Freakonomics, or inspirational, such as Seth Godin’s books. But this is in your face, intensely academic (but not in a pejorative way), very irreverent (rather insulting, to economists, historians, bankers and anyone who ‘theorizes’ on historical data) and bold enough to say – here is the black swan problem, but I don’t know the solution.

I thoroughly enjoyed the book over solitary lunches, dinners and coffee sessions. This one took a long time to read. Last time I recall spending so much time finishing a book was Atlas Shrugged, because digesting Ayan Rand’s thoughts took a while. This one, because Nassim Nicholas Taleb just compels you to believe that most of the professions that involve theorizing on historical data, are fraud. He bashes economists (especially the Nobel laureates), historians, finance professionals (not the traders though). His strongest tirade is against the philosophers, who NNT believe should stand most scrutiny since their only job is to think and help society through their though. His attack is mild against people who hold ‘real’ jobs – doctors, engineers, factory workers.

Basic Premise

Book’s basic premise is – there are very few but fiercely strong incidents that shape our future (of economy, evolution, behaviour, any profession) and we can’t predict them. NNT calls them Black Swan and these could be negative (wars, market crash, epidemic) or positive (accidental invention/discoveries, book sales). Even though we can’t predict them, we should cushion ourselves against them (in case of – Black Swan) or take speculative bets to benefit from them (in case of + Black Swan).

What I learnt from the book

I couldn’t have predicted that Jiju will die suddenly in March. But I definitely could have ensured that his Life insurance, Mediclaim and other paperwork is in order. My personal learning from the book is:

1. I can’t predict strong events in my life, but I should insure my risks
2. 80% of my portfolio in safe investments – FD, real estate and gold. Rest 20% in intensely speculative bets – options trading, lending start-up capital in lieu of shareholding and others that I have to figure out
3. Past behaviour is not an indicator of future performance (even though every MF document says it, very few actually understands it, and even fewer take corresponding action)
4. Competition theory – the race to the top slot only needs a little difference in ability over your competitors. Try a little harder, and you may get it.
5. No Evidence of Disease doesn’t equate to Evidence of no Disease.
6.  A data point that disconfirms your assertion/theory is way more important than 100s of data points that confirm it

Overall, a highly recommended read. But beware of the strong language. It is a necessary evil.

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Book Review – Dork by Sidin Vadukut

How I got hold of the book

Once in a while I used to be amused by the Office Humor column Cubiclenama at the business newspaper Mint. Then I stopped reading mint. Maybe a year later, a friend recommended following Sidin on twitter and reading his Cubiclenama. But that’s not how took up this book.

Some time back, I prepared a reading list of Indian Novels based on genres. One of these genres is lightweight reading published recently (say last 3 years). Dork was in it, Sidin was recommended and luckily, it was present in my office library too. So, borrowed it and voila! Finished reading in two straight sittings. You can actually finish in one but I didn’t want to read it beyond midnight.

The Good Stuff

• Office humor – especially consulting humor
• Writing style – as diary entries. I haven’t read any novel in this format earlier. Update (a little online search later): The genre is called epistolary novel i.e. a novel written as a series of documents, in the form of a journal entry, letters etc. That said, I remember Nehru’s Letters of a Daughter being of such format. Never read it though.
• Light read

Some funny stuff

• Kart(h)ik called Yetch and Kartik called Rajni
• Youtube video of Einstein flying – 300k hits in a  few days
• Flip flop between Megha and Gouri when Megha wears short skirts
• Ball bearing episode
• The ‘testimonials’ from William Dalrymple’s biggest fan’s youngest sister and the likes
• Malayali brotherhood – there was no code of ethics when it comes to two Malayalis (Babykutty)

Didn’t understand

• Getting proposed for a threesome from a girl who saw Dork pissed drunk thrice

Could have been better

• Sudden ending
• Work at JHA was too long

Quotes:

1. She is hot. In a Nandita Das sort of way.
2. Yogita. Idiot. Cow.
3. 5 is awesome and 1 is deep shit
4. None of the phones in the Corporate Communications department is working
5. Only Principals and Partners could create information
6. Amelie has a flashback. Only I had a flashforward.

Conclusion

Would recommend this for a light reading, if you can get the book for free (or minimal cost) – a library, a friend, a gift. Or at max from a roadside pirated bookseller. Not otherwise. INR 200 is too costly for this.

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