As the financial sector shifts, so does the reach of the jolt to economic structures around the world. Economist Nassim Nicholas Taleb and his mentor, mathematician Benoit Mandelbrot, speak with Paul Solman about chain reactions and predicting the financial crisis.
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Nassim Nicholas Taleb talks about the challenge or failure of predications and Black Swans. Recorded before the current global economic turmoil
Speaker(s): Professor Nassim Nicholas Taleb
Recorded on 5 December 2012 in Sheikh Zayed Theatre, New Academic Building.
Taleb believes that many of the best and most successful systems in the world (such as evolution) have antifragility at their heart. Conversely, those systems which reject antifragility and suppress volatility (such as modern politics and banking) become weaker and less able to withstand the inevitable shocks – the major tragedy of modernity, according to Taleb. But antifragility is not simply an antidote to “black swan events”. Taleb believes that understanding antifragility makes us less fearful in accepting the role of these events as necessary for history, technology, knowledge and everything.
Nassim Nicholas Taleb spends most of his time as a flâneur, meditating in cafés across the planet. A former trader, he is currently Distinguished Professor of Risk Engineering at New York University. He is the author of Fooled by Randomness and The Black Swan, an international bestseller which has become an intellectual, social and cultural touchstone. This event marks the publication of his new book, Antifragile.
Nassim Taleb talks about the financial crisis, how we misunderstand rare events, the fragility of the banking system, the moral hazard of government bailouts, the unprecedented nature of really, really bad events, the contribution of human psychology to misinterpreting probability and the dangers of hubris. The conversation closes with a discussion of religion and probability. From http://www.econtalk.org/archives/2009/03/taleb_on_the_fi.html