Money and Finance
- The Calm Before The Storm - By Nassim Nicholas Taleb And Gregory F. Treverton
Link to article: The Calm Before the Storm: Why Volatility Signals Stability, and Vice Versa The divergent tales of Syria and Lebanon demonstrate that the best early warning signs of instability are found not in historical data but in underlying...
- Learning To Love Volatility – By Nassim Taleb
Several years before the financial crisis descended on us, I put forward the concept of "black swans": large events that are both unexpected and highly consequential. We never see black swans coming, but when they do arrive, they profoundly shape our...
- Dundee 2011 Annual Report
We have been living through such a time as we witness the financial markets ebb and flow based on not totally understood macroeconomic events. The world remains in a major financial crisis and central bankers are taking extreme gambles which could have...
- Risk, Exposure, And Probability
From the book What I Learned Losing A Million Dollars by Jim Paul and Brendan Moynihan: "The definition of risk is to expose to the chance or possibility of loss. Most people erroneously try to assign a numerical value to that chance, which simply confuses...
- George Soros On The Coming U.s. Class War
Whenever reading Soros’ market thoughts, it’s good to keep in mind that he maintains the flexibility to change his mind on a dime. And to keep in mind what Hugh Hendry said about him in The Invisible Hands: “Take Soros and the insights he generously...
Money and Finance
George Soros quote
“My financial success stands in stark contrast with my ability to forecast events. In this context, we must distinguish between events in financial markets and events in the real world. Events in financial markets determine financial success; events in the real world are relevant only in evaluating the scientific merit of my approach.
Even in predicting financial markets my record is less than impressive: the best that can be said for it is that my theoretical framework enables me to understand the significance of events as they unfold—although the record is less than spotless. One would expect a successful method to yield firm predictions; but all my forecasts are extremely tentative and subject to constant revision in the light of market developments. Occasionally I develop some conviction and, when I do, the payoff can be substantial; but even then, there is an ever-present danger that the course of events fails to correspond to my expectations. The concept of the “bull market of a lifetime” is a case in point: it was highly rewarding in Phase 1 but it became more of a hindrance than a help in Phase 2. My approach works not by making valid predictions but by allowing me to correct false ones.
With regards to events in the real world, my record is downright dismal. The outstanding feature of my predictions is that I keep on expecting developments that do not materialize. During the real-time experiment I often envisioned a recession that was just around the corner, but it never occurred….” –George Soros, The Alchemy of Finance
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Related previous posts (see quotes from Hendry and Taleb in these posts relating to Soros and the quote above):
George Soros on the Coming U.S. Class War
Nassim Taleb on the importance (and difficulty) of being willing to change your mind if the facts change
- The Calm Before The Storm - By Nassim Nicholas Taleb And Gregory F. Treverton
Link to article: The Calm Before the Storm: Why Volatility Signals Stability, and Vice Versa The divergent tales of Syria and Lebanon demonstrate that the best early warning signs of instability are found not in historical data but in underlying...
- Learning To Love Volatility – By Nassim Taleb
Several years before the financial crisis descended on us, I put forward the concept of "black swans": large events that are both unexpected and highly consequential. We never see black swans coming, but when they do arrive, they profoundly shape our...
- Dundee 2011 Annual Report
We have been living through such a time as we witness the financial markets ebb and flow based on not totally understood macroeconomic events. The world remains in a major financial crisis and central bankers are taking extreme gambles which could have...
- Risk, Exposure, And Probability
From the book What I Learned Losing A Million Dollars by Jim Paul and Brendan Moynihan: "The definition of risk is to expose to the chance or possibility of loss. Most people erroneously try to assign a numerical value to that chance, which simply confuses...
- George Soros On The Coming U.s. Class War
Whenever reading Soros’ market thoughts, it’s good to keep in mind that he maintains the flexibility to change his mind on a dime. And to keep in mind what Hugh Hendry said about him in The Invisible Hands: “Take Soros and the insights he generously...