One more attempt with the title of the technical version.
Looks like:
*Elements of Risk Engineering: Probability and Decision in the Real World*
is more descriptive of the effort. I wanted Engineering in the title to stress the necessity of an anti-intellectual, nobullshit approach to risk.
I rewrote the introduction to cristallize the approach.
via One more attempt with the title of the… – Nassim Nicholas Taleb | Facebook.
NNT posted to his Twitter…
Fixed Tech Collection (added 50 pages) http://www.fooledbyrandomness.com/Technicalpapers.pdf
nntaleb: Finished My Central Paper http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1669317
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Links to pdf download page for:
Convexity, Robustness, and Model Error
Nassim Nicholas Taleb
NYU-Poly
August, 31 2010
Abstract:
This discussion makes the distinction inside the Fourth Quadrant “Black Swan Domain” between fragile an robust to model (or representational) error on the basis of convexity.
• The notion of model error as a convex or concave stochastic variable.
• Why deficit forecasting errors are biased in one direction.
• Why large is fragile to errors.
• How economics as a discipline made the monstrously consequential mistake of treating estimated parameters as nonstochastic variables and why this leads to fat-tails even while using Gaussian models.
• The notion of epistemic uncertainty as embedded in model errors.
In addition, it introduces a simple practical heuristic to measure (as an indicator of fragility) the sensitivity of a portfolio (or balance sheet) to model error. Finally, it sets an explicit path to conduct policy based on robustness
Working Paper Series
nntaleb: Chap from the nw essay on ROBUSTNESS & FRAGILITY (2nd Ed of TH BLCK SWN in US/UK, sprt bk in Eu/Asia) http://TwitPWR.com/GmF/ pdf download [Fixed]
Loved this- really, so many of our mistakes seem to lead simply from the poor choice of words.
Pg.320:
For consider the opposite: differences without a distinction. They can be brutally misleading. People use the same term, measuring, for measuring a table using a ruler, and for measuring risk—when the second is a forecast, or something of the sort. And the word measuringconveys an illusion of knowledge that can be severely distorting: we will see that we are psychologically very vulnerable to terms used and how things are framed. So if we used measuringfor the table, and forecastingfor risk, we would have fewer turkeys blowing up from Black Swans.
For those of us who have been following NNT’s Tweets, this will sound familiar.
So I am currently torn between (a) my desire to spend time mulling my ideas in European cafés and in the tranquility of my study, or looking for someone who can have a conversation while walking slowly in a nice urban setting, and (b) the feeling of obligation to engage in activism to ro- bustify society, by talking to uninteresting people and being immersed in the cacophony of the unaesthetic journalistic and media world, going to Washington to watch phonies in suits walking around the streets, having to defend my ideas while making an effort to be smooth and hide my dis- respect.