Nassim Nicholas Taleb Angry

This is wonderful -- a talking head who states frankly that he doesn't know. He also tries to explain to reporters that no one knows, and that there are not two sides to the debate that make sense.

There are two types of people: those who try to win and those who try to win arguments,they ae never the same.
Nassim Nicholas Taleb

Taleb, in his book The Bed of Procrustes: Philosophical and Practical Aphorisms, makes the point as I understand it that we live in a world of which we are largely ignorant and thus we should devise strategies to protect us from the unexpected.

Risk management is usually based on models in which the alternatives are not only understood, but their probability is assumed to be known. Some experts go the next step and assume that they can not accurately define the probabilities. As I get Taleb, he is concerned with situations in which we don't even know what all the alternatives are. He suggests that a lot of important decisions are of this class. Taleb clearly knows a lot about formal models of decision making (especially in the field of investments), and I assume he finds them to be intellectually stimulating. He simply believes that they should not be taken to be factually accurate guides to action in most important circumstances, and that their misuse led us into the financial crisis we are now living.

I note that{

• The new information and communications technology is making things work faster than ever before, and we depend on computer analysis even though we can not fully understand the programs which the computers are following.
• Smart people are working to design new financial instruments all the time and many (most?) of the people using those instruments don't understand them well.
• The rest of us have our wealth and our incomes affected by these people using financial instruments we are barely if at all aware of.
• Firms hire public relations people to put their practices in the best possible light for the rest of us.
• People in firms tend to hide their mistakes even if they recognize them, and hide their ignorance.

Ignorance multiplies and we reach the unknowable. And the Republicans think that we should not regulate markets and that the public servants who try to do so are overpaid and provided with too many benefits!