Black Swan

I really enjoyed the Black Swan by Nassim Taleb. The author is a pretty impressive guy and even more impressive after saying what he said below. This was sent to me by a neighbor who gave me a hard time for my views before the election and then stopped me in the street a month ago to tell me that he wanted his vote for Obama (and his money) back.

Taleb, ‘Black Swan’ Author, Wants Obama Vote Back

2009-09-16

By Joe Schneider Sept. 15 (Bloomberg) --

U.S. President Barack Obama has failed to appoint advisers and regulators who understand the complexity of financial systems, Nassim Taleb, author of “TheBlack Swan,” told a group of business people in Toronto. “I want my vote back,” Taleb, who said he voted for Obama, told the group. The U.S. has three times the debt, relative to the country’s economic output, or gross domestic product, as it had in the 1980s, Taleb said. He blamed rising over confidence around the world. U.S. Federal Reserve Chairman Ben Bernanke, who was appointed to a second term last month by Obama, contributed to that misperception, Taleb said. “Bernanke thought the system was getting stable,” Taleb said, when it was on the verge of collapse last year. Debt is a direct measure of over confidence, he said. The national debt, according to the U.S. Debt Clock Web site, is at $11.8 trillion. The nation must reduce its debt level and avoid “the moral sin” of converting private debt to public debt, he said. “This is what I’m worried about,” Taleb said. “But no one has the guts to say let’s bite the bullet.” As the founder of New York-based Empirica LLC, a hedge-fund firm he ran for six years before closing it in 2004, Taleb built a strategy based on options trading to protect investors from market declines while profiting from rallies. He now advisesUniversa Investments LP, a $6 billion fund that bets on extreme market moves. --Editor: Josh Friedman