Quotes from book
Fooled by Randomness

Name: Fooled by Randomness
Author: Nassim Nicholas Taleb

Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets is a book by Nassim Nicholas Taleb that deals with the fallibility of human knowledge. It was first published in 2001. Updated editions were released a few years later. The book is the first part of Taleb's multi-volume philosophical essay on uncertainty, titled the Incerto, which also includes The Black Swan , The Bed of Procrustes , Antifragile , and Skin in the Game .

“Lucky fools do not bear the slightest suspicion that they may be lucky fools - by definition, they do not know that they belong to such a category.”

Nassim Nicholas Taleb book Fooled by Randomness

Fooled by Randomness (2001)

“We favor the visible, the embedded, the personal, the narrated, and the tangible; we scorn the abstract.”

Nassim Nicholas Taleb book Fooled by Randomness

Fooled by Randomness (2001)

“Wittgenstein's ruler: "Unless you have confidence in the ruler's reliability, if you use a ruler to measure a table you may also be using the table to measure the ruler."”

Nassim Nicholas Taleb book Fooled by Randomness

page 224
Fooled by Randomness (2001)

“Mild success can be explainable by skills and labor. Wild success is attributable to variance.”

Nassim Nicholas Taleb book Fooled by Randomness

Fooled by Randomness (2001)

“A mistake is not something to be determined after the fact, but in the light of the information until that point.”

Nassim Nicholas Taleb book Fooled by Randomness

Fooled by Randomness (2001)

“I always remind myself that what one observes is at best a combination of variance and returns, not just returns.”

Nassim Nicholas Taleb book Fooled by Randomness

Fooled by Randomness (2001)

“I try to make money infrequently, as infrequently as possible simply because I believe that rare events are not fairly valued, and that the rarer the event, the more undervalued it will be in price.”

Nassim Nicholas Taleb book Fooled by Randomness

Fooled by Randomness (2001)

“Unlike a well-defined, precise game like Russian roulette, where the risks are visible to anyone capable of multiplying and dividing by six, one does not observe the barrel of reality.”

Nassim Nicholas Taleb book Fooled by Randomness

Fooled by Randomness (2001)

“[E]conomists are evaluated on how intelligent they sound, not on a scientific measure of their knowledge of reality.”

Nassim Nicholas Taleb book Fooled by Randomness

page 85
Fooled by Randomness (2001)

“The more data we have, the more likely we are to drown in it.”

Nassim Nicholas Taleb book Fooled by Randomness

Fooled by Randomness (2001)

“Probability is not about the odds, but about the belief in the existence of an alternative outcome, cause, or motive.”

Nassim Nicholas Taleb book Fooled by Randomness

Fooled by Randomness (2001)

“It does not matter how frequently something succeeds if failure is too costly to bear.”

Nassim Nicholas Taleb book Fooled by Randomness

Fooled by Randomness (2001)

“At no point during his ordeal did Nero think of himself as 72% alive and 28% dead.”

Nassim Nicholas Taleb book Fooled by Randomness

Fooled by Randomness (2001)

“[E]conomics is a narrative discipline, and explanations are easy to fit retrospectively.”

Nassim Nicholas Taleb book Fooled by Randomness

page 257
Fooled by Randomness (2001)

“Trading forces someone to think hard; those who merely work hard generally lose their focus and intellectual energy. In addition, they end up drowning in randomness; work ethics draw people to focus on noise rather than the signal.”

Nassim Nicholas Taleb book Fooled by Randomness

Fooled by Randomness (2001)

“[In] economics… you can disguise charlatanism under the weight of equations and nobody can catch you since there is no such thing as a controlled experiment. Now the spirit of such methods, called scientism by its detractors, continued into the discipline of finance as a few technicians thought their mathematical knowledge could lead them to understand markets. The practice of financial engineering came along with massive doses of pseudoscience.”

Nassim Nicholas Taleb book Fooled by Randomness

page 115
Fooled by Randomness (2001)

“There is a saying that bad traders divorce their spouse sooner than abandon their positions. Loyalty to ideas is not a good thing for traders, scientists - or anyone.”

Nassim Nicholas Taleb book Fooled by Randomness

Source: Five: Survival of the Least Fit—Can Evolution be Fool by Randomness | A Review of Market Fools of Randomness Constants | The Traits They Shared
Fooled by Randomness (2001)

“Delivering advice assumes that our cognitive apparatus rather than our emotional machinery exerts some meaningful control over our actions.”

Nassim Nicholas Taleb book Fooled by Randomness

Fooled by Randomness (2001)