I know nothing except that I know nothing... Nassim Nicholas Taleb, the quant trader who believes only that all models will eventually be wrong, has had his book come out in paperback. I haven't read it yet, but I'm going to.

Joe Nocera reviewed it in the NYT this week. Here's part of his review:

For me, the issue isn't so much that Mr. Taleb is wrong in his analysis. The problem is his fundamental nihilism. Taken to its logical extreme - something Mr. Taleb is happy to do - his stance strongly implies that it's pointless to even try to forecast things like stock prices or economic trends. Nor, he seems to be saying, should we even bother attempting risk management, since we always miss the big thing that winds up really mattering. And on both points, I think he's dead wrong.

Think about it: how would the markets work if people weren't trying to anticipate the future? On what basis would you buy or sell a stock? Predicting cash flow for the next 20 years might be "moronic" - but it's the only way we can try to value a stock.

What about current profitability? What about dividend payments? What about all the things that would matter if the stock market functioned according to the principles of INVESTOR capitalism rather than SPECULATOR capitalism?

Argh.

Anyway, I'm looking forward to the book. The Malcom Gladwell profile on Taleb in the NYer a few years back was very cool.  ¶ 3:25 PM