Tue, 21 Jul 2009
Nassim Nicholas Taleb, The Black Swan
Despite the author's annoying personality, arguably the best book that predicted the Global Economic Crisis of 2008.
Now it might be said that Taleb's argument can be simply put as, Do not assume a normal distribution. But then, so much of the quantative analysis that underlay financial risk models (and the consequent assurances of financial stability) were based on just that assumption. As far as I could tell, the only justification anyone ever presented was that it made the mathematics possible. Possible, but delivering predictions that did not match up to what actually happened.
Taleb, it must be said, is annoying and smug. But he has been proved right.
Nassim Nicholas Taleb . The Black Swan The Impact of the Highly Improbable. 2007, Random House, . paperback . 366 pages.
ISBN 1400063515 .
