What is Taleb's own black swan?
http://en.wikipedia.org/wiki/Black_Monday_(1987)
That unpredicted event made him and his organization loads of money, and made him a sudden seer of markets. Which is humorous because his book Fooled By Randomness is primarily a bit of a bitter tirade about how we declare people savants because they happened to be in the right place at the right time.
Since then he gets the classic seer type treatment, for instance the other post notes that he "predicted" the financial collapse of 2008 (weird that someone would register just to post that). Yet almost everyone predicted 2008. No, seriously, the house bubble and crisis, and the probable impact on the market, was absolutely common knowledge by the time Taleb made his pronouncements, and was the endless material of virtually every financial discussion. There was absolutely nothing of worth predicted in that, but that's what you get when you got lucky once.
I am not sure what would convince you otherwise though, since it seems like you have made up your mind already. Please loosen up on the snark.
And yes, I've seen a lot of claims of various other successes of Taleb, with a lack of any actual citations or proof at all: His own fund folded after yielding mediocre returns, and then he started consulting for a fund that seems to demonstrate a tremendous amount of bluster, with some curious and cringe-inducing ways of reporting returns, the narrative reading like the story of a gambler, telling you with great pride about the 35:1 payout on their roulette bets, skipping over the 0:37 payout on all their other bets.
I've worked with a large number of hedge funds, many of whom made a lot of money in 2008. You haven't heard a word from them because they have no need to do PR or to pitch the one bet they made right. I become suspicious of any who does.
And the danger of Taleb's lucky bet was that he is listened to as an expert, at least by some. Virtually everything he had to say about government intervention after the financial crash has been proven fundamentally wrong -- actual reality demonstrated that. Thankfully a lot of people didn't listen to him.
For instance if you asked 1000 people to guess coin flips, on average one half will be wrong on each flip. So on the first flip you'd drop to 500, then 250, then 125, then 65, then 32, then 16, then 8, then 4, then 2, then you'd -- in a perfectly ideal scenario -- have one person left. A person that remarkably, "against all odds", guessed 10 coin flips in a row right! Surely they must be some sort of magician or seer, right? Yet their probability of guessing the next coin flip is no better than the people eliminated in the first round.
But that is exactly what we do with things like exceptional events: We find the person who was right about a set of events, among a collection of people guessing almost everything, and assume they've cracked the code. Even outside of financial situations (like being a guy who happened to have a portfolio that did great during an extreme black swan on October 19th, 1987, even if that same portfolio generally did terribly), just look at what happened with 9/11: Of all of the millions of scenarios that people concocted for fiction or just postulating, anyone who talked about a plane hitting the WTC suddenly became prophetic.
It's actually a pretty good book, as an aside.
For instance, Taleb's example of fund managers that beat the market for five years in a row. You start with a cohort of 10,000 and a 50% chance of beating the market each year. There will be a group of 300 or so fund managers that consistently beat the market 5 years in a row. This does not differentiate the lucky from the skillful. 1) Analyzing other cohorts that had higher success rates and 2) their investment strategies and decisions would be necessary to make the determination.
Well, a broken clock is right twice a day. Someone who always calls for a market correction will eventually be right. The real question is how will the investment strategy fair over decades or longer.
We may have different takeaways from the book. My takeaway was that one should invest in becoming skilled (learn strategies that work in the long run) rather than seeking or worshiping those who may just be lucky.
The implication is obvious. 'gggggggggggggg is either an employee of yours, or is in some other situation such that she doesn't want to get on your shit list. Nevertheless, the truth must come out! Hence, anonymity.
A different discussion concerns the fact that Taleb's possible luck in 1987 makes him a prescient seer for things like the financial crisis. But he isn't, and a tremendous number of things he has said have simply been wrong (most notably, and importantly, everything he said about government intervention. He was 100% wrong in every way).
People ask why people get the heckles up about Taleb, and it isn't actually about Taleb at all. It's about the, for lack of a better phrase, Taleb "fan boys". Bizarre that such a thing exists, but people like having their prophet.
>>> There was absolutely nothing of worth predicted in that,
I think it was quite worthy for those who was on the right side of the market. From what it looks like, though, a lot of people were on the wrong side. So presenting it as "everybody knew" is a bit misleading, it seems.
There was zero specificity in Taleb's proclamations. It was just the vague "there are a lot of debts and an inflated housing market that is bound for a correction and is immensely interest rate dependent". Yeah, that's great, but is the same thing everyone else was saying.
GM went bankrupt during the financial crunch. This may blow your mind but the bankruptcy of GM was predestined for years -- their debts kept growing larger while their profits stayed static or shrank.
Everyone knew it was coming, it was only a question of when and what would precipitate it. Yet, people still traded in GM. Exactly the same concept -- people don't trade on what they think will happen tomorrow or next year, they trade on what they think other people think will happen tomorrow or next year.
So there is no misleading, and honestly only "rubes" fall for the "I predicted this" bit.
You realize "everyone" and "every economic fear monger" are very distinct groups? Before the crisis struck, those fear mongers were generally thought of as curiosities or cranks, not visionaries. It wasn't that long ago, too early yet to rewrite history.
Moreover, theories like these: http://www.wired.com/wired/archive/7.09/zeros.html http://bullnotbull.com/archive/predictions-2007.html http://useconomy.about.com/b/2007/01/03/2007-forecast-for-th... http://knowledge.wpcarey.asu.edu/article.cfm?articleid=1344 or even this one: http://www.amazon.com/gp/product/0385514344
were pretty popular. At the last one, we've got excellent review from top people at Federal Reserve and Fannie Mae.
>>> There was zero specificity in Taleb's proclamations.
Huge surprise from a guy who talks about principally unpredictable events as the basis of his philosophy. You expect him to talk about black swans and then say "the market would go down X points at day Y"?
>>> In the same way that the world is pretty certain we're going to run out of oil.
Are you sure? http://cnsnews.com/news/article/gao-recoverable-oil-colorado...