View
628
Download
32
Category
Tags:
Preview:
Citation preview
The Black Swan
Book Presentation Presentation by Pradeep
“The world will not evolve past its current state of crises by using the same thinking that created the situation” ….. Albert Einstein
Pradeep-XYZ
Music Irregular Fracture Disorder
Chaos
Failure
Roughness Error err…
Risk
NoiseImperfect
Crises Complex
Unknown
IrrationalUnlucky
Theme
Pradeep-XYZ
Connect the dots
Pradeep-XYZ
Contents What is a Black Swan ? The World Today Problem of induction and biases We just can’t predict Aesthetics of randomness Conclusion- Lessons from The Black Swan
Pradeep-XYZ
What is a Black swan ? History behind the title (Once upon a time in
Europe) Highly improbable (difficult to predict- an
outlier) Highly Consequential Retrospective ( see it coming!)
Pradeep-XYZ
Examples 9/11 Oct. 19, 1987 Harry Potter Computer Internet iPod (10 years back) Google(15 years back)
Pradeep-XYZ
The world today Extremistan Vs Mediocristan1
The Flat World (Globalised and interconnected with Web)
Recursive (The Harry Potter effect)
Pradeep-XYZ
Mediocristan Vs Extremistan
[ Height, Weight, IQ] [ Wealth, Book Sales, Hits]
Pradeep-XYZ
Mild Randomness Wild Randomness
Problem of induction
Pradeep-XYZ
Biases Behavioral Economists- irrationality (Daniel
Kahneman and Amos Tversky1) Confirmation bias2
Narrative fallacy3
Silent evidence Fight with the pecking order Ludic fallacy4
Pradeep-XYZ
System 1 and System 2 (Biases) System 1 : Experiential one, effortless,
automatic, fast, Opaque, parallel-processed and can lend itself to errors
System 2 : the cognitive one (thinking), reasoned, effortful, slow, logical, serial and self aware
Pradeep-XYZ
Economist.com – what’s your choice ?
Pradeep-XYZ
Economist.com- what’s wrong ?
Pradeep-XYZ
Narrative fallacy (Biases)
A BIRD IN THE THE HAND IS
WORTHTWO IN THE BUSH
Pradeep-XYZ
We just cant predict Examples Track record – Philip Tetlock’s research1 and
WWII Attitude towards prediction2 ? (I don’t know
Vs Guesstimation) Tools of predictions (Bell curve-extremistan
and Spreadsheet-anchoring) Serendipitous world (Sextus empiricus) &
Complex world (Sensex and Swine flu) What to do when you can’t predict ?
Pradeep-XYZ
Examples on prediction errors Computer (IBM) Telephone Beatles (expectation) Recent economic recession Tsunami Charles Darwin’s “The origin of species”
paper
Pradeep-XYZ
“This telephone has too many shortcomings to be seriously considered as a means of communication.
The device is inherently of no value to us.”
(Western Union memo, 1876)
Pradeep-XYZ
“I think there’s a world market for maybe five computers.”
(Thomas Watson, Chairman of IBM, 1943)
Pradeep-XYZ
"Everything that can be invented has been invented." -- Charles H. Duell, Commissioner, U.S. Office of Patents, 1899.
Pradeep-XYZ
“We don’t like their sound and guitar music is on the way out.”
(Decca Recording Company rejecting the Beatles, 1962)
Pradeep-XYZ
Aesthetics of randomness From Mediocristan to Extremistan Challenges with Bell-curve Fractal Geometry (aka Geometry of nature)
Pradeep-XYZ
Mediocristan to Extremistan The economics of superstars1
Cumulative advantage (Academic citations) Lingua franca2 (Zipf’s law) The Long Tail- Chris Anderson Globalisation (Reason behind recent
recession ?)
Pradeep-XYZ
The aesthetics of randomness Benoit Mandelbrot ( Rock star of
Mathematics- Author- (Mis) behavior of markets)
Fractal Geometry or Geometry of Nature (irregularity, Chaos )
What’s common (Connect Dots ?) (Music, Literature, Markets, Sociology, Temples, Nature, Star wars graphics)
Symmetry, Scalable2 , exponential1 80/20 or 50/01
Pradeep-XYZ
Pradeep-XYZ
Pradeep-XYZ
Fractals captured in camera…
Pradeep-XYZ
Indian Temples
Pradeep-XYZ
Animated fractal mountain
Pradeep-XYZ
The End
“Our knowledge can only be finite, while our ignorance must necessarily be infinite.”…Karl Popper
Pradeep-XYZ
Appendix
Pradeep-XYZ
What to do when you can’t predict ? Being a fool in the right places (be human) Be prepared (Barbell strategy) The idea of positive accident (love to fail as
Americans do)
Pradeep-XYZ
Time Scale
Pradeep-XYZ
Recommended