Taleb Slams Journalists: My New Book Is "Designed To Be Hated By Bullshitters"

Authored by Nassim Nicholas Taleb via Medium.com,

Skin in the Game is another addition to the Incerto, now volume 5; I avoided duplication by referring to where in the Incerto some points were developed such as via negativa or monoculture of forecasters or expert problems. You simply don’t repeat in chapter 23 what was said in chapter 5, but can make reference to it.

Now it so happens that I am in the BS busting category, which includes journalists (especially journalists). And the book is designed to be hated by BS operators who can be book reviewers. I instructed publishers to send the book to only doers, not people who make a verbagiastic living.

Let me say it again. I am intolerant of BS; I suffers no fools except when the BS is harmless.

The Judgment of Cambyses

So far three journalists have, while uninvited, attempted to do a (sort of) hack job: John Gapper (FT), Zoe Williams (Guardian), and Phil Coggan (Economist; yes I am outing him, SITG). The problem however is that they agree with the general message of the book (who doesn’t ?) except in what concerns them, so the best way is to perform some assassination on side points: 1) find what appears to be a “flaw”, 2) use the technique of Sam Harris, i.e. make the author look like a hateful spiteful person who hates everybody simply because he doesn’t like bullshitters. The problem of course is that it is hard to claim I am against all experts, not just the .1% faux experts so they disguize the claim as a he is a “hates everybody” type of fellow.

Also note that the book isn’t about SITG but the weird consequences (modern slavery, looks of surgeons, rationality of survival, religious practices, commercial ethics, Lindy effects, and, mostly, risk taking). You will also notice that given the homework done by journos, the “flaws” happen to be in the beginning, never at the end.

John Gapper (Financial Times)

John Gapper is a nice fellow with whom I sparred on Twitter for the usual reasons, his (justified) frustration over my open disrespect for the general members of hi profession. In all fairness, he finds the book entertaining (though hard to summarize journalistically, which explains the longevity of the Incerto but annoys reviewers) and important. As expected, he writes: “Taleb has again put his finger on a flaw in how society operates, one that has damaging moral and financial results.” But then he continues:

GAPPER: The book’s weakness is that it never satisfactorily addresses the counter-argument to the need for “skin in the game” — that having a stake in an outcome eliminates impartiality and causes conflicts of interest. Judges are not paid according to how many people they send to jail and, more trivially, it would be a bad idea if I were being paid a cut of Taleb’s sales.

On that, Mr Gapper misses twice. The book answers the point twice explicitly. Primo

ME in SITG: “We re- moved the skin in the game of journalists in order to prevent market manipulation, thinking that it would be a net gain to society. The arguments in this book are that the former (market manipulation) and conflicts of interest are more benign than impunity for bad advice. The main reason, we will see, is that in the absence of skin in the game, journalists will imitate, to be safe, the opinion of other journalists, thus creating monoculture and collective mirages.

(Background: in The Black Swan I show a statistical illustration of such monoculture with forecasters without skin-in-the-game cluster on a wrong answers, which is nonrandom: the variance within forecasters is smaller than that between forecasts and out of sample realizations. Too technical for Gapper).

Secundo, he missed the discussion of the corrupt Persian judge Sisamnes: a judge’s skin in the game is in the exquisite symmetry of justice. Skin in the game means consequences when you are wrong as much as when you are right. Being paid simply to jail people is asymmetric and has no penalties (I wonder how he can make such a blatant mistake and fail to realize SITG is about matching disincentives to incentives).

And John Gapper’s skin in the game as a reviewer is in the preservation of symmetry (again, not just incentives): my making him accountable in his review with a review of his review. Gabish?

Philip Coggan (The Economist)

It looks like Phil Coggan liked the book. He was just irritated by it. Fair:

The reader’s experience is rather like being trapped in a cab with a cantankerous and over-opinionated driver.

The point is I had the exact same tone in The Black Swan and in Fooled by Randomness (calling economists charlatans etc.), books he liked. Except that the message did not make him feel uncomfortable then (someone insulting lucky and rich fools give journos a feeling of revenge).

But one contention:

Yet even here Mr Taleb applies different standards to his own arguments and those of others. When he criticises Western politicians for intervening in Libya, he has no skin in the game.

I have extensively discussed the point in Antifragile, in the via negativa section. At length. Should one need intervention “to save the world” or something, one must the price for the failure. And it is a risk: to prevent the excuse of pushing a wrong button. Omission is not symmetric to commission under iatrogenics. The argument of “do something” is carefully plotted against the principle “first do no harm” and SITG is the solution: you own it if you break it. Under such symmetry, I am ready to act.

Sisammes

Zoe Williams (Guardian)

Now, she has a problem. A big problem. A very big problem. Reading comprehension at a high school or perhaps elementary school level.

(…)chief executives and shareholders who want values maximised — people whose skin is very much in the game of driving down wages.

What??? The book explains that skin in the game is not incentives, but disincentives. So I wonder about her own abilities …

You wouldn’t want homicide law to be written by the mother of a murdered child.

Of course, she doesn’t get the very notion of disincentives.

She also makes many, many such mistakes not worth discussing here: doesn’t get the minority rule, knows nothing about helicopters; she practically knows nothing.

*  *  *

We note that Mr. Taleb was not done with the industry's bullshitters and did not take kindly to Barry Ritholtz' comments...

Seems like a pretty clear rebuttal.

Comments

janus ???ö? Mon, 02/26/2018 - 19:16 Permalink

this looks like a great read.

Taleb has belly-fire; what's most appealing so regarding is his ability to channel the conflagation in a controlled burn. 

but i must say janus is flat-out flabbergasted -- how dare he do anything but praise a womyn!?!  it isn't so much that we must give womyn a pass in their mediocrity; it is of particular importance that we celebrate and fete their incompetence.  this much should be clear.  i reckon Taleb is due a fierce excoriation from the erudite ladies on The View. doesn't Taleb know that womyn are off-limits for crits?  this is pure, undiluted sexism.  Taleb is perpetuating the patriarchy and should expect a deluge of snarky tweets from the likes of ellen degeneres to extinguish these unseemly flares from his belly-fire.

janus

In reply to by ???ö?

nonclaim ???ö? Mon, 02/26/2018 - 19:12 Permalink

To be fair, in the early days of his blog (10 years ago?) he did a pretty good job at criticizing .gov numbers and how bankers were leeches, GS most of all.

And then one day he joined GS as a proprietary trader of sorts... As a public figure in his area of expertise, he should explain why he changed sides. He never did, he simple forgot his well stated past opinions.

From there, my point of view, you can't take his words to mean anything serious.

In reply to by ???ö?

FrankDrakman nonclaim Mon, 02/26/2018 - 20:21 Permalink

What are you, an idiot? An "IYI", as Taleb would have it? His time at GS as a trader taught him important lessons, like markets can stat irrational longer than you can stay solvent, cut your losses, etc. He also QUIT because he didn't feel at home in the culture.

I have more respect for him, because he went into the lions' den, learned something, and got out.

In reply to by nonclaim

garypaul anarchitect Mon, 02/26/2018 - 19:24 Permalink

Well, here's my two-cents of opinion/criticism:

 

I haven't read the book yet, but this remark stood out:

"I wonder how he can make such a blatant mistake and fail to realize SITG is about matching disincentives to incentives"

But isn't that the whole problem with people, that they pick and choose what suits them? How would you ever be able to enforce a "matching disincentives to incentives". Just think of all the snake-oil, con-jobs, etc. that would go into fooling people about this "matching".

 

In reply to by anarchitect

Endgame Napoleon garypaul Mon, 02/26/2018 - 21:30 Permalink

This was an interesting article, especially the concept of skin in the game. He seems to use it in the same way that Americans [used to] hold professionals to a standard of dispassionate, disinterested work quality, wherein they did not let themselves fall into the habit of letting subjective emotionalism determine their decisions in workplaces. The fake-feminist era has shredded this standard, intertwining work and personal life in family-friendly workplaces to the point where there is little professionalism left. Maybe, he is saying that, because humans are innately subjective, the skin-in-the-game approach restores some of the lost professionalism. 

In reply to by garypaul

Bondosaurus Rex Mon, 02/26/2018 - 17:51 Permalink

Barry! The man said fuck off! I think he meant fuck off!

 

Shits about to get all mathy and shit up in here. Get yo protractoh muthah fuckah and lets get to decimelin. Don't make me put a compass in yo ass.

Ignatius Mon, 02/26/2018 - 17:52 Permalink

"When he criticizes Western politicians for intervening in Libya, he has no skin in the game."

I guess by "no skin in the game" they mean Taleb's not a psycho, country killer, so who is he to judge.  Damn it, I also stand naked as I, too, have fallen into this cleverly laid intellectual trap of openly criticizing serial country killers.

NoDebt Mon, 02/26/2018 - 17:53 Permalink

"You wouldn’t want homicide law to be written by the mother of a murdered child."

Something the left has no problem doing on the backs of the FL school shooting victims nonetheless.

 

dchang0 Mon, 02/26/2018 - 17:59 Permalink

These journalists are funnily arrogant, thinking we would care what they think about this book. How about we read the book ourselves and judge its arguments on their own merit? Cut out the middleman, if you will.

karenm Mon, 02/26/2018 - 18:01 Permalink

He's not "in the BS busting" business. He's just another player and actor, only he gets to play good cop. These types tell partial truth, enough to make people think they're the good guys, but they always stop short of telling the whole truth.

 

Such is the game. 

Nuclear Winter Mon, 02/26/2018 - 18:03 Permalink

The Black Swan rises. Super Fragility in the markets. Go, Taleb, go. Break the balls and expose the bullshitters (I won't mention names, just acronyms: CNN, WP, NYT, WSJ, ABC, NBC, CBS).

taketheredpill Mon, 02/26/2018 - 19:09 Permalink

 

Barry "What's Wrong with Me and a Bunch of My Buddies Racing our Ferraris on the Interstate and Endangering The Lives of Hundreds of people?" Ritholz.

 

Fuck Off Indeed. 

I Write Code Mon, 02/26/2018 - 20:09 Permalink

>"This book is 25% probability theory, 25% classical anecdotes,
>25% stating the bleeding obvious, and 25% complete bullshit

Typical popular book on technical topics.

 

 

Musum Mon, 02/26/2018 - 20:17 Permalink

I didn't know Taleb was at war with Barry Ritholtz, Sam Harris and the nincompoops at FT and the Economist. Kudos to Taleb! I've had some animus for Ritholtz and Harris for a long time. Good to see I'm not alone.

atlasRocked Mon, 02/26/2018 - 21:16 Permalink

Correct assessment on Ritholtz.  I smoked him out years ago when I offered him a $50 gift certificate to his favorite restaurant if he could recite a single case where "stimulus" had revived an economy and the stimulus money paid back without a world war.  

He booted me off his discussion page.   Completely   dishonest fraud pusher. 

 

Complained about bank bailouts - but never blamed Obama.  Or if he said one tiny thing - he went back to exalting Obama the next day.  A fraud like Krugman.