Quotes About Uncertainty

There is, in the Black Swan zone, a limit to knowledge that can never be reached, no matter how sophisticated statistical and risk management science ever gets.

It is often said that is wise he who can see things coming. Perhaps the wise one is the one who knows that he cannot see things far away.

Mark Buchanan's Ubiquity, Philip Ball's Critical Mass, and Paul Ormerod's Why Most Things Fail.

Wittgenstein's ruler: Unless you have confidence in the ruler's reliability, if you use a ruler to measure a table you may also be using the table to measure the ruler. The less you trust a ruler's reliability (in probability called the prior), the more information you are getting about the ruler and the less about the table.

How? Probability is not a mere computation of odds on the dice or more complicated variants; it is the acceptance of the lack of certainty in our knowledge and the development of methods for dealing with our ignorance.

And the Black Swan is what we leave out of simplification.

In this world, you should always be suspicious of the knowledge you derive from data.

The only condition for such brand of more sophisticated rationalism: to believe and act as if one does not have the full story—to be sophisticated you need to accept that you are not so.

The hidden benefit of antifragility is that you can guess worse than random and still end up outperforming.

we are too brainwashed by notions of causality and we think that it is smarter to say because than to accept randomness.

The longer one goes without a market trauma, the worse the damage when commotion occurs.

Huet presents arguments against causality that are quite potent—he states, for instance, that any event can have an infinity of possible causes.

Alas, investors and businesses are not paid in probabilities; they are paid in dollars. Accordingly, it is not how likely an event is to happen that matters, it is how much is made when it happens that should be the consideration. How frequent the profit is irrelevant; it is the magnitude of the outcomes that counts.

illusion of local causal chains—that is, confusing catalysts for causes and assuming that one can know which catalyst will produce which effect.

If you know all possible conditions of a physical system you can, in theory (though not, as we saw, in practice), project its behavior into the future. But

The turkey problem can be generalized to any situation where the same hand that feeds you can be the one that wrings your neck.

The fact that you got heads or tails on the previous flip does not change the odds of your getting heads or tails on the next one.

Forecasting (in words) bears no relation to speculation (in deeds).

Things break on a small scale all the time, in order to avoid large-scale generalized catastrophes.

The more you summarize, the more order you put in, the less randomness. Hence the same condition that makes us simplify pushes us to think that the world is less random than it actually is. And

Nassim Nicholas Taleb

fragility and absence of skin in the game.

My idea is that not only are some scientific results useless in real life, because they underestimate the impact of the highly improbable (or lead us to ignore it), but that many of them may be actually creating Black Swans. These

our successes depend on randomness).