The Future Has Always Been Crazier Than We Thought | Nassim Nicholas Taleb

fora tv' the world is thinking [Music] good evening this is a long now foundation event my name is Stuart brand thank you for overflowing this wonderful theatre I should mention that later this month we have another speaker craig Venter who may also draw a large audience especially because he's creating life these days and in a sense this is a second in a series of talks about thinking about the future only the speaker tonight says it's not the future that he talks about but I'll bet that many of us interpret it that way the last speaker was Paul Sappho who is here tonight Paul talked about techniques of forecasting especially in technology and sort of in the decade range of time in a sense he's looking at the future in a micro scale in context of the long now foundation where we like to think of the last 10,000 years in the next 10,000 years decades are pretty quick in that period of time large events have a way of happening and so the speaker tonight is talking about the macro scale and macro events please welcome Nassim Taleb so my talk is not definitely gonna be our bloody future I know nothing about the future first of all let me show you the picture of the book the American Statistical Association has a special session on the Black Swan and that's what they're gonna do with my book in August and Colorado I have to show up to be yelled at the the Black Swan what is the Black Swan first of all it's not this wine and let me explain to you that people as part of our like inability to think to do second order thinking most people buy me this wine not thinking that other people are aware the Black Swan wine affected right Black Swan so please if I ever invite you to dinner or some piece for Christmas I just had an email today from students at Harvard they want to piss off their professors by by inviting me of course they and they said we're gonna have reception and and and they mentioned this wine okay so it's not is undrinkable so what's the Black Swan no no honestly typically the red wine what's the Black Swan before the discovery of Australia we had no reasons to believe that swans could be of any other color but white or people in the old world and effectively there was a an expression in medieval England you'd sooner see a Black Swan then say for example it was just like saying when pigs fly or when when when I don't know there's something intelligent or something also needs the exceptions so there was an expression until we saw Australia and effectively one the sighting of a single bird destroyed millennia of confirmation so it was a post as a logical problem by showing that there's no reason you cannot rule out a Black Swan because you haven't seen any okay my problem is not a logical question my Black Swan is an event it's not a bird so and it's an event that has three properties the first property it is hard to predict very difficult to predict based on information understanding the right spot okay based in on information before its occurrence prior information based on historical information you have here a sample of black swans the most interesting one is the tie someone's gonna forecast the future at the forecast that human beings 2,000 years away would constrict their blood supply with this device for example okay and attend meetings okay so that's very difficult to predict the computer was a Black Swan it changed the world and nobody thought the computer could do anything you know it was initially used for communist oryx I mean the Watson from IBM did not think that this tool could have any use the rise of religions likes one totally unpredictable Harry Potter has a black swan a lot of cultural phenomena are black swans the to me the most significant black swan and the one I'm going to focus next few minutes is the first war the first war we had after Napoleon we saw for about a hundred years that the world became civilized and that you know people became conscious of the need for peace and you had this devastating war the biggest war something was destroyed and of course it came in two volumes you had Volume one and then had sequel so so here we have black swans events of low predictability high consequence but the most vicious part is the following one is that before the fact they're extremely predictable but after the fact you know what we saw him coming so we have this is what I call the retrospective there's the distortion if these events are prospectively unpredictable retrospectively predictable why we even have disciplines to make us to give us the illusion of understanding of the world you say have disciplines that make us misunderstand the world by giving us this illusion of private ability history for example economics other such things astrology okay so we have and what what's the mechanism by which we sort of like have the solution understanding the world the first one is what I call silent evidence before people think that the first war was predictable particularly if you are gonna if you have been to school high school and they discuss the first war it appears to result from tension between the UK on one hand Austria and Germany on the other okay so you think that there is tension let to worry if you see tension then you can predict for that you're not looking at Ephesus of tension that did not lead to war and there were a lot of episodes of tension before that that did not lead to war and these episodes usually led to parties in Baden Baden you see was opera saying there's a lot of champagne and they get drunk all right Kings get drunk plus they know each other so you have to realize that after the war things tension causes war but if you're in a champagne business you realize think tension causes you know drunkenness by kinks when they make up okay so we have that problem so let me give you an illustration of this inability we have in looking at what I call the silent evidence of pool of evidence that did not lead to the same result the comment made this is recorded know even better my comment made by publisher about the success of the Black Swan and he was explaining it as follows look it has an animal and the color on the cover explains the success now okay this is so I went when I heard that I said okay plane I'm gonna take care of this guy I looked on Amazon for how many books have animals and colors on the title and uncover that ended up flopping okay and you had plenty of him I found 69 books with a Black Swan and their titles okay that were flops you don't hear if you don't hear about him is because it flops we're not looking at evidence plus of course you have permutation pink elephant different colors different animals okay so plenty plenty of book like that that flock so this is what I call the cemetery of evidence and for those of you interested in probability it's a big probability problem because we compute probability based on those who survived probabilities of survival not based on the pool of those who started it so this is very endemic in a way we analyzed the world the way to understand information is what we perceive information decision-making under uncertainty is completely dominated okay with this mistake of taking a pool of information and excluding the rest so it's what I call silent evidence what we have it on Wall Street you look at the winners and say they have skills and don't look at people are the same sets of skills who ended up losing because these people don't read biographies you see they don't say how I lost a million dollars tell you how they made it so you have that so and then but the problem is historians you know people on Wall Street you can understand that they're not that smart but historians did not know that okay or did not deal with it empirically now I happen to have spent 18 years as a trader and I hated it okay but I stayed there because it was fun particularly because he had economists around and people who make forecasts and could make fun of them so there was some some some there was some advantages to it but one thing I discovered is that when you work with Beauty the power of economics is that we have 20 of data when you have data you can do some some real analysis on the data that's completely unbiased because the data is going to be there and you can throw numbers at as a computer so I looked at history to see if anybody did something like that and it discovered that one of your future speakers Neil Ferguson a brilliant man and I recommend if you ever want to have lunch fun lunch with someone to call him up if you know he's good lunch right so he is and he wrote a paper showing that although we believe that the first war was predictable bomb the bond market there's something called war bonds in UK and the bond UK mom did not predict it so cannot be that predictable if the bond market nobody told you know the bond market okay so we have have prediction markets and stuff like so so we realized now when you run if you dig into history how bad we are at predicting how bad we are at seeing things how bad our predecessors were at predicting but a mechanism of course is called over causation I skip this because it's too complicated but there's another there's a also there's some psychological mechanisms involved that you make an actual prediction you have the outcome and then all right this is remembers predictions back ok I've sat down what you remember typically that you remember you remember having predicted is more consistent with what you observed so you don't remember what you're actually predicted but you revised your memory of what you actually predicted continuously to make it consistent with current events not only you do that with your prediction we also do that with your intentions which is a big problem and for us in the trusting because you would realize that if we didn't have this effects people would know that they're very bad at predicting economics Department would be empty commit suicide or something like that you would have no no social science to speak of ok people would turn cab drivers or something so you would realize but but that it's a it is a psychological bias now let me talk about the Black Swan problem in in history okay in in in philosophy and and and I'm going somewhere with this particularly with my next next work the first gentleman up there on the left the one who's little horizontally challenged his name is Hume okay it's called humans problem but it's not his problem it's because he wrote in English is great ideas write in English then it should be remembered what people who write in English that it's effectively he took it from someone else but Hume is worthy discussing because he was completely annoyed was a Black Swan problem completely annoyed with that problem of induction it was not called Black Swan I thought it was called the problem of generalizing from finite sample or problem of induction and what he did with it is very simple he said you know what I leave it for the philosophical cabinet and in real life I can't deal with it he was a party animal and his reaction to the Black Swan problem is to become even more horizontal you see which he gained a lot of weight and then he died and he had a happy life in Edinburgh in Paris in Edinburgh okay so let's forget about him because it could be no help except also to illustrate one thing that happened in philosophy is that increasingly philosophers became what I call domain dependent is they're good at talking about a problem in a classroom and then they forget about it when they leave the classroom and it's a bias that addition for example not understand statistics in real life the good in front of the blackboard we know that from a lot of experiments the way I I discuss it in the Black Swan as I talk about that for that domains of the dependence about the reebok Club in New York where people go get in their gym clothes and then take the the the elevator to the to the stair masters and then get on stairmasters and log their 112 floors stories and then stop and then take a lot of it ok so you have domain dependence because not recognizing it's something indexer of real life so let's forget it this guy next to him there is a french guy but the French don't know about him or at least for Caliban want to forget about it he is a bishop called Bowie and he dealt with a Black Swan problem by becoming extremely religious he not liking science and of course we had the Enlightenment that became bro science and with all the tragedies that we have coming from it and so he is forgotten he became very religious the gentleman here is al gazelle he was the Arabic see the Arabic language I mean the sorry the Arabs calling an Arab the Persians call him a Persian so he's a Arabic language philosopher who attacked the classical philosophers by writing a treatise called the on the incoherence of philosophy very famous stratus and he created Sufi Islam out of his thing so his blacktron problem led these two gentlemen to become extremely religious now the one on the right is my hero or you know I think we don't really know if he existed or if you know but what he represents would make him my hero is sex this America's he's not and philosophy books not very common philosophy books he was he had two things he was a skeptical gentleman who phrased the problem induction just the way Hume later on repeated it second century BC ad and his second attribute he was a doctor so there was a school of medicine of decision maker on the makers under uncertainty called the empirical doctors who were damn good doctors they did not like theories did not like to generalize did not like to extend and to unobservable okay they're not like to make an you know go from from what they know to what they don't know extremely careful they call themself and persist they did not like to generalize and these before extremely successful unfortunately they were completely you know what medicine became intellectual rationalists that we saw the understand human body so these people were out of business for about 15 centuries before medicine came back the other barbers okay their ideas can and if you guys are alive today it's because these guys with their ideas or because Barbara is not because of intellectual doctors the contribution of intellectual doctors finally there's a gentleman who you recognize him tickle if you live in Berkeley all right Karl Marx all right so Karl Marx had this idea one thing he wanted you know in his thesis on fear Bob he wanted to say he said the philosophy you know was just talk let's do something with it unfortunately but so his idea was to turn knowledge into action so my idea is that opposite how to turn lack of knowledge and lack of understanding into action so this is pretty much my talk and how not to be a turkey in the Black Swan this is my cousin who did this story of the turkey and the Black Swan you have the turkey is in my book the Black Swan turkeys fed for a thousand days every single day confirms to the turkey that that butcher is extremely or the human race in general is extremely interested in its welfare increasingly until of course when the Black Swan happens I'm interested in stories of Turkey one because it shows the Black Swan story you know and the consequences of inferring from observables but the other one is that for the turkey it's a Black Swan but for the butcher it's not a Black Swan okay so Black Swan depends on the set of knowledge you have now if we're going to have an earthquake here I mean you have to make contingencies all right if there's going to be an earthquake this following slide will probably take care of you know what I have to say right so make sure that you listen to the next slide because it summarizes my position on the Black Swan the two provinces media pristine and extremist an and by the way I thank Chris Anderson for suggesting the name extremists and I gave the manuscript I had a nerdy name right and he suggested something else and it was a cream Stan I owe it to him right and so in mediocre Stan the following properties hold let's play this following start experiment say we gather at thousand people randomly from the planet okay and you bring him here you put him on a scale small on scale of course well it's made in California scale extremely oil built okay and make sure you have one Frenchman but not more because people standing next on all right so on a scale and make it so you have them okay you and you weigh them alright then try to imagine the heaviest human being you can think of who can still be called a human being and add him or her to the scale half thousand how much of the total will he represent how much 0.3% half a percent point three percent I don't know California typically and you know point three percent the heaviest human being on the planet would be nothing like this from the total so in me or Christine is following rule holds when your sample is large exception can happen that they're not going to be consequential to the total so this is a domain I told me you're cursed and that domain everything you've learned in statistics or almost everything you learn statistics applies to mediocre Stan and it's called the law of what large numbers okay that as your sample becomes large you're not saying Thorpe it also tells you can diversify your portfolio it tells you why insurance companies services someone survived although they don't quite survive that well okay it tells you a lot of things about without this supreme law of when you're cursed and you would not have statistics now this is a problem because if let's take the very same sample of a thousand people and you're gonna have people from Rwanda in your sample the very same sample and try to think of the heaviest person you can think of who can still be called it no sorry of the wealthiest person you can think of can still be called a person he is not far from here I guess no all right he can still recall the person with borderline no and add them to the sample how much of the total will he represent okay it'd be hundred percent okay he works about sixty billion dollars the remaining two thousand will be words two million dollars alright you have people from beyond from there okay so the supreme law of extremists and tells you to follow whenever you take a large sample a small number of observations in that domain will represent a big share of the total so we have two domains one that's dominated by the exception extremists and and one that's dominated by the general by the mediocre by the central by a lot of people the collective one the collective dominates the other one okay very simple let's take compare income dentist for example not that you will not find a dentist who makes more money than all the other dentists combined in a book business what's her name the lady she sells a lot of books right okay that effect you have what you have 16,000 books published every year in the English language of these 16,000 books some years five books five to 25 books represent half the sales so you have concentration in extremists an and we're moving from mediocre Stan to be extremists and if you're paid by the hour your mediocre Stan extremists an is you guys are the epicenter of extremists and okay you have Google stuff like that it won't have happened without you know someone who makes sales sandwiches could not become the Google overnight okay you cannot if you have demand itself sandwiches and then you have demand for two billion sandwiches I don't know if Ortega has to do to deliver two billion sandwiches but in in in the electronic and an information age you can deliver you know put a zero okay so you have a different properties and extremists and fairness social fairness of course is more prevalent in media pissed and then extremists and of course you have more opportunities in extremist an but or the illusion of opportunities extremists and but you have a lot of unfairness because you have a winner-take-all effect an extremist on and the metaphor is the story I use in a Black Swan is that of Giacomo an Italian opera singer and they don't have a Pavarotti yet Pavarotti is - 75 years old okay you don't have a you don't have a way to store your voice the income of opera singers okay it's not going to be massively skewed because if you were and you find yourself some little town and you're okay right so the guy from Milan is non-compete with you and and and then they discovered the all these technologies right that destroyed Giacomo and and helped Pavarotti okay so the the for example Amer as a as a writer I'm an extremist an because every time one of you buys my book I don't have to go to my hotel room and write it and I but if I were making sandwiches I'd have to do that so the the properties of extremists an are quite nasty in the sense that one observation can destroy the whole thing one exception can destroy the whole thing economic life is from extremists and the metrics we have are not that they're to extremists and so take the companies in the u.s. you have what twelve thousand listed companies between a hundred and two hundred companies represent half a cupful ization there's this rule of 8020 Pareto's law 8020 it's not 80/20 things in life are about 0.05 and 99.95 so this is and this is an illustration of extremists and versus media Christine the inequality is this is on the left as mediocre Stan on the right as extremists and so pretty sure you stand here in the middle is on sway to super extremist and you don't have that with height so there are two kind of randomness this is two kinds of randomness and and they're not that I mean this is about the different even in California you you know you you you know I can have someone say walk in here eight feet tall you guys won't be surprised I would be surprised but I can't see someone walking in here two billion feet tall but it was wealth with with random variables that belong to it so they're not the same animals okay so when someone says this is an approximation when is there something called the Gaussian curve okay it's a tool of extremists of majorca Stan and there are other more statistical names that you know belong to video Christine when they say their approximation so as much of an approximation as this plant approximate a human okay there are large qualitative differences now let me turn on philosophers III get the stuff whenever I hear the word uncertainty principle as if it has anything to do with uncertainty for a lotta reason number one quantum mechanics is from Madeo crest and that's the first one and second one the uncertainty we have in physics in that kind of uncertainty in quantum mechanics is at least a certain of all our certainties because they average out you see which is the reason why the stable has not haven't been here all this time okay I've been talking for twenty minutes and they will did not move so the problem to me I'm certainty on here someone is I was trying to go to Lebanon and there's always war and there's absolutely no scheduled timetable for the end of the war okay there was when they killed Bhutto it was not scheduled all right the the subprime crisis so the uncertainty we have is macro uncertainty it's so monstrous and people waste their time talking about limits of knowledge here when in fact when the limits of knowledge are not consequential the limits on the right are consequential yes they don't think that these on the rights have real limits that's why I get I get very angry another thing I called the work called the ludecke fallacy to try to beg people not to equate uncertainty with what you see in games as casino number one because casinos for mediocre Stan and second one you don't know the real life you know you don't know the problems in the real life you don't know the casino the sterilized probabilities most of what we learn tickly in philosophy probability comes from this stupid thing so I called the occlude ik because I learned that once you use a Latin or Greek word for anything you could charge a lot more for it so use ludecke there's another reason okay because gamblers fallacy is something else that belongs to a Berkeley former Berkeley professor almost verse key and Danny Kahneman did but let me give you my polish joke so I've written two non-technical books and almost every other line I go on a rant against what I call you know the ludic fallacy or manifestation of known probabilities till I received by mail a copy of the Polish translation of my book and and and there's a passage in it so I say have nothing to lose games how I can angry when illustrators suggest a die to put die online or look what was it right so that's my photo stroke let's let's how it looks like right so so so my idea in the Black Swan is not like Hume to say okay let me get horizontal alright and forget about you know leave my anxiety about the problem section it's my idea and the Black Swan is so try to get not to be the turkey and realize try to get out of trouble so I think the media post an extremist an is a good start you worry about the Black Swan an extremist and because it's consequential so I already know how to worry about the consequential and people keep down mirror.you Talib worry too much you cross the street tell them yes my idea is unlike you I don't want to cross the street blindfolded because it looks like we have a psychological problem we tend to be tricking when we know about the risks and overreact and most risk-taking and society and this is you can see sir experiments are taking not because we're particularly courageous and have a lot of bravado and and and but know the arts no it's because we don't know the arts or we don't know what's going on we don't know what's taking these risks think of bankers okay they're the most incompetent probably prefer a professional in history because I've been capped off by the government's but bankers are a they take a lot of risk they think they're not taking risk if they know the risks they're taking they won't change it would become plumbers or something else you say so they don't have the temperament so it's not so a lot of people take risks because they blindfolded not because they are conscious or they see what they're doing this is classical and finance is that you see frequently that their investors letter when someone does well for about and then every single metrics every single metric in economics will give them low risk profile for 12 years all right and sure enough they at the end they have that you know that letter is very sound letter dear investor surely these events as as much of a surprise to us as they are to you and and then okay and but you know I saw letter sent by some folks in 1998 who had pseudo Nobel in economics and I saw the one sent recently I was a prime there was no linguistic evolution the same thing right gear investor so this is what I've been fighting is this is a typical illustration of the problem production I want to try to avoid it this is what you see in finance or in and that's anything or you're going to have this as a performance it's gonna be dominated variation or dominated but this is 20 years by small number of observations always have that yet people to chat about small variations all the time I was talking to forget it to Ferguson and and I got in my head that maybe I should start thinking about history so I went to the bookstores to fill up with books of history history ography we're thinking about doing some way of dealing with randomness and history by comparing McGilchrist and to extremists and and if you were to do a quantitative history like simplify history to a simple quantity stochastic process that would be quantitative on top you would have Amedeo Christine type history at the bottom you have an extremist and pop history or most you don't have a lot of moves but guess what when you have a move is going to be abrupt so most of the time nothing happens and then you have big jumps history jumps it doesn't crawl and that was a statement I made in the Black Swan and against everything that was known in history Agra feel I don't do a all that stuff next let me talk about the experts this is gonna be in a subway in London okay ignore experts okay some expert not that other experts the not all experts alright and we're going to see ya know not not you're not the plumber alright I plus you need the plumber okay let me start with the mathematicians all right I know I'm sure the planning mathematicians here enough a few would be insulted like to do okay so I spent some time working with mathematicians of randomness and of course I made it the following discovery one day when the gentleman was giving a lecture of why mathematics were important in society and he was going to explaining how traffic lights were optimized and so on for math and math is great and a thought but what if we wrote an anti history of mathematics number one of where mathematics has not been useful to society extremely destructive and the second one is instances in which society did not eat mathematics so mathematics plays a very small role but owing to self-serving biases they tell you what they do for you so don't tell you what they don't do for you it's like politicians so we have the feeling that they're important of all the space of possible equations that we have the one mathematicians can handle is minut so what we do what they do is they want something that can prove the number of things we can prove or your theorems for it's so small that mathematics is it's very whatever can be mathematics or be suspicious now we were spoiled in physics they tell you look it works in physics we were spoiled in physics although you know that a lot of things that have not been mathematize but how much medicine how about economics how about all these other fields okay they give you this is called a confirmation bias like politicians they do tell you what they did for you know or they do for you comfort by the confirmation is trouble for a lot of reasons first let me show you this slide this is you know to see it well yeah bunch of nuns okay and I think they know the mathematicians know about uncertainty the knowledge of uncertainty resemble the knowledge of these ladies about nightlife and fun and partying honestly right so this and having spent nine years working with mathematicians they'll finally I gave up and and teaching creating transfer great anxiety and mass PhD students and the problem that this is very mechanistic now so there is a big conflict between probability we're dealing with non observables and mathematics that requires mechanistic mind look that looks for certainties and most of the mathematics we have for randomness it's gonna be then focused on the ludic fallacy on Majorca stan things that can be easily mathematize and that's a tragedy it is a tragedy because it is a tragedy because you have this big wedge between practice and and and this perception of reality okay coming from mathematics the other problem we have okay I'll make it clear next few slides is that we tend to tunnel when we project the future so you tend to you'd like to tunnel so you like to use someone's tools to tunnel further because otherwise you have anxiety so when you project the future you project something extremely narrow that resembles projection of the present even less crazy than the present okay and and of course you don't realize you know we're not crazy enough to imagine the future I mean events that take place whether if I discussed these black swans and here 20 years before they happened I'm sure that that someone was called an ambulance and it was taking me away because these scenarios will create a reality delivers much crazy a scenario then our mind can imagine so there's a tunneling helped by mechanistic tools but why why why why do we do that why do we produce these measures of uncertainty why do we like to produce this measuring Authority well we have a genetic or we have whatever we have that we need to reduce our anxiety by using metrics there's nothing wrong with talking about uncertainty there's something wrong about talking about certainty to satisfy take novocaine or take some or have a drink okay it's better than producer forecast if you want to lower your anxiety and we'll see later when I talk about the expert breaking down the expert line when I was on Wall Street the fun was to look at projections made by economists you see lawyers are very smart you can't catch them because they're slick and they always manage to give you some vague answers about anything economists they give you a forecast well you go process it if you have a computer you have coffee and you have a trainee you can process the forecast to see if if they if they work better than cab drivers and they don't work better than fact cab drivers and there is a psychological explanation is the forecast that worsens invented this or the Express receipt in the past you had to sweat to make a forecast now you could just extend the self in drag good names right you extend the self so you go to year 2020 2043 you go as many centuries as you want it doesn't cost you much in the past it was it was Labor so the other so there is this is framing okay typically and once you see it on a piece of paper start believing in it it's what we call framing a person who really caught these people with our pants down is Philip tetlock who's supposed to be here tonight and and Phil tetlock did process all these and and of course within the psychology of it when I met Phil I just realized that hey you know what we know all the psychological biases but I then realized that there was a very simple way to figure out which domains we can forecast and which domains resists forecasting and guess what it's mediocre stand versus extremists and domains that have the property the randomness is mediocre stand property we are good at forecasting the acerola of the you know when we deal with stars and so on our errors are Gaussian okay and this is what it discovers about the first application is measurement errors and you know as a strong me right so but we're talking about anything social anything where one single observation can have massive consequences we're not good at forecasting so mediocre stands extremists and there is a tableau made by a gentleman called Santo all right where it looks like the know what versus know how distinction works like a souffle chef you know that he's an expert but an economist I'm not sure or as their expert definitely addressing and looking like an expert but not expert at delivering a service that they claim to you know that's what I call the for expert or pseudo expert so the not now why do we listen to these people well the first one is there's an old as you know I'm sure you all know it don't ask this plans woman all right Ernie all right don't ask a barber if you need a haircut okay so if you can't ask someone it's profession so there's a self-serving aspect of professions and the second one is we sent like empty suits which allowed me you know to formulate the following rule never take advice from someone wearing suit and tie it works it lines up perfectly to the middle post an extremist and stinking it Lorex okay it lines up to the for expert now there's a lesson this is Robert rivers figured out a something and it was very interesting that was before the invasion of Iraq is that if you have any plans to make war to engage in war you don't know what's going to happen but we're not good at predicting wars because we didn't have many wars in our genetic heritage we did a lot of raids raisin polishing we're good as we humans and and and he showed how primates are very good at invading territory killing all the males and this kind of thing so it looks like simple domains again the errors are familiar crest and we're good at forecasting complex domain we don't understand we don't have the right intuitions the link between action and consequence it's not as visible errors are can be monstrous and dominated by extremes so so again Wars are from since Napoleon words have been more and more from extremists an small yet for example if you want to invade Grenada again go ahead no problem right ok if you want to say China you don't have to all right so you see the difference between between simple and more complex domain and of course we're going to take some advice from Yogi Berra who said the future ain't what it used to be ok big philosopher random and he understood the point about how we're gliding more and more into some form of concentrated disorder one one of the things I discuss in my next book I studied religion a little bit I don't believe in beliefs by the way alright on a belief that we humans use the police to act I think the Leafs have some other purpose but the problem that I find very inconsistent and I don't know if some Dawkins friends or these guys are here I find extremely inconsistent to be suspicious of the bishops okay here this is an offered up service a more thorough so these suspicious of the bishop and be a sucker when when it comes to stock market ok or listen to the economists I don't understand what's metrics double standard you using ok when you know it's a Dawkins was saying that these guys these people have double standards he's talking about post modernists he said anybody riding a plane to go to a conference ok when they doubt the laws of physics is a hypocrite to me anybody invested in stock market who is critical ok a religion is a hypocrite you're either I mean that's my point is there's nothing wrong about being critical or volitional you gotta go all the way by bu so what we happens is our skepticism its domain dependent and we're going to test it there's a very easy metric for me to test scepticism it took me a while to figure it out you show things to see if people see false patterns or not and we're gonna be testing I have a little a lab in London at London Business School was a Dan Goldstein and we're gonna test to see if religious people are most fooled by randomness outside religion like vice versa okay so it is it is the problem substituting religion was CNBC stock and some that you know that the stock market analysts okay they're worse than nothing a lot worse than nothing okay so there is an inconsistency there and incidentally I figured out one thing is that medicine you know that medicine for a long time we had an expert problem in medicine you still have some expert from in medicine medicine killed more people than it saved particularly in the late 18th century late 19th century okay till discovery penicillin okay and why because of something I call the illusion of control and if by going to a doctor by going to a doctor you you you you know you wanted to do something going to a doctor to do something you hurt yourself so going to a the Temple of Apollo or something like that or any foreign religion so long as it takes you away from a doctor it's gonna be beneficial for you alright so that's the idea of alleged people don't this I had a notion of religion that sort of conflict with the rest to illustrate what I mean by illusion of control illusion of control is when you go to the casino and and you see people wanted to throw so it got a high number on a die they saw it hard okay and they want a low number the saw it soft okay and this is the so this is another this is a Council of Economic Advisers with His Eminence there and they're all there so and this is an exercise of illusion of control okay all right so now we're out of the funds section how many more minutes do I have sorry let me get technical here sorry ten minutes okay all right so now let me get into the the work at the boring section right this may cause a lawsuit I hope the gentleman here I'm here I'm debating him tomorrow very nice gentlemen since I'm not taking him I'm attacking a statement let me talk about probability for a while so it's going to get more technical so called boring sec if you wanted to leave and come back for the drinks all right so this gentleman made the following statement he said these events that we saw last summer should happen every 10,000 years actually has three days in row his answers have every 10,000 years if you look at the gentleman you see that he's so considerably he's considerably younger than 10,000 years so therefore where is he getting his probabilities from okay not from personal experience he definitely is getting his probabilities from where he's getting him from from a theory all right ah-huh so where do you see from something in philosophy would call that a priori there was an a priori it doesn't come from any form of empirical observation or anything and I don't know 10,000 years ago we were training I we don't have the records if what they were doing then and if they're training how sophisticated they were what computers are used so we have a problem with claims made about small probabilities because the smaller the probability the less observable it is going to be the more you're gonna rely on theory and theory is going to be fragile let me add something to that problem and that problem I call it the telescope problem okay what matters is not the probability what matters is the empathy event so if I have a small probability of losing a million dollars okay I don't care about the probability I care how much I lose all right so what matters is you worry more if you have a small probability of being in a plane that crashes and if you have small probability of not having an umbrella and of the rain okay so it's not the probability that you care about it's the probably times the event the magnitude of the event the pair probability times pi times land on the the the problem we witness here is that the smaller the probability the more confident they seem to be about that pair Pi Lambda when in fact it's the most unstable because the smaller the probability the more error you gonna have the higher the area gonna happen the estimation of that probability you see necessarily if it's much sent we have smaller absolute number of observations through had larger error so therefore anybody talk to my small probability doesn't know what it's talking about literally okay or they're not talking about probabilities they're talking about something else I don't know a religion or whatever it is okay they're not talking about probably all right so this is a problem even you know that we have because that pair the the higher that that triangle I call it PI lambda becomes a lot more random I mean to repeat the point it does a near flood okay require a lot more than thousand years observation okay but thousand-year flood that's much more devastating son hundred year flood you see so this is this is a problem we have a probability if I know the Federal Reserve you pay a visit a let them know okay which brings me to prediction markets very quickly I'm going to go over the boring section here people use the some idiotic statement that we're good at predicting number of be collectively better than individually you know that we know some got since Calton number of you know beings in the drawer okay the infer that we can predict socio-political events first statement you can see the difference these are familiar crest and your errors are not gonna be monstrous okay the number of jellybeans here the second one is that when you predict probabilities it's much easier than predict total contribution of the impact you see if you have you know if you have small probability of having Bill Gates or super Bill Gates it makes a big difference the prediction markets we may be able to predict prediction markets because it's a binary event there's no consequences yes or no you say so whether it's cream Stan or non-extremist and maybe okay but even then you cannot rely on the probability using these prediction markets as probability look at today today Hillary Clinton is she was she was like what she had 70% probability of you know she was trading at 70% now she's trading at 50% so these probably changed all the time how can you rely on them as indicators like people think that probabilities are like the temperature we go have someone from MIT and two Russians come in and we're going to measure it and get the number okay it's like temperature it's not like temperature we don't measure it okay we estimate it and even collectively we're not better at it and there's things that even collectively we'll never be able to get because the properties are way too complicated this is the problem I have was using prediction markets we can use prediction markets to predict how many car crashes you're gonna have on a highway maybe not for something more complicated than that second point I have with models versus practice is a story that metaphor of the ice cube that I discuss in the black song I just realized we I tried to read the black monkey I was bored and I didn't like it but but I found that that section needed some expansion right so because it's I really you know what it's a good idea to discuss the the if I the problem of most theorists problem for universities is you go from theory to practice the degrees of freedom from theories of practice are considerably narrow small the reverse is monstrous so let me give you this for if I leave in a small piece of ice cube on the floor okay you can easily get someone in second year physics students to write the equation to tell you what's going hard to predict how that ice cube will melt okay it's a very simple thing the second rate student could do it all right right know someone from Boston that is can do it okay so the yeah so you can you can you can predict so but now conditional on seeing water on the floor is it easy to reverse-engineer the ice cube no you have an infinity of ice cubes the different shapes that can with have January it's exactly going from theory to practice versus practice to theory given something you observe the observable it generative observables and uh no no no okay would be a theory you have infinite number of theories that can do that particularly when we are dealing with nonlinearities when particularly when it is nonlinear okay in nonlinear where it varies let me give you this metaphor this solution of following doctrine the most intelligent piece probably piece of work done on following that induction since success in Turkish if I have had these series of dots up there I ask you to extend them in the future okay with the linear model this is one step one okay you can extend them from twenty years and to eighty years if it's linear you just take a ruler and extend it in the future you agree now you're assuming a saline your model AHA but if it's but it turns out to be nonlinear how do you know from that part of the sample okay so a linear series of points can generate something nonlinear or it could be what we have in the fourth graph so statement is as follows there's one on one line that could connect series of dots so we have uniqueness this is why people like linear models but we're going to non linear model whatever you see can be explained by an infinite number of nonlinear series or non-linear equations it's infinite so you realize the explosion of degrees of freedom which is say that okay we have in a nonlinear world and so someone's gonna ask me about basin's of a truck tractor and chaos theory and stuff like that I'll talk about it I'm definitely certain from experience that someone's gonna ask me about them in this session so this is why I don't extend I don't deal with the future the other problem is it was power loss okay you only can look at him qualitatively what we call fractal self-similarity extremists and as you can say is has one structure which is a fractal subsidiary the one that was you know the similar to the geometry of metal brought the problem is that reverse engineering the parameters guess what they're all over the map it's almost impossible to judge you can just deal with it qualitatively but qualitatively we can do very well so let me conclude here was my what to do or what not to do I was in essence about two months ago and I spoke for an hour and the person told me yeah we've told us you know now what should we do I had a cute state I entered the state of Rage you know that was not really a stone I've been talking for an hour I would tell me what not to do and you don't count it the guy was a consultant and don't count it as as advice we don't negative advice to me is vastly more important than positive advice but people don't think it is important just like if you go to the bookstore you can only learn from people's mistakes you don't have how I failed in life these people a cemetery of evidence don't publish their books okay see how I made a million times can be accidents but there's regularity so you see the 10 commandments okay except for for a couple I think they're negative advice and look they stuck okay even even almost the adultery part every day they've been bit work so advise negative advice tends to work okay compared to positive advice okay so I tell you what not to do all right what not to do is not to rely to use forecasts and if a qualitative way not the reason for an anxiety relief told you what not to do throughout so only a charlatan going to say ten points I'm trying to resist it because I do not want to be a business strategy type charlatan was you know ten steps to success and how to become a millionaire right so this is why I hate it and people tell me like I was in Washington and and someone said well I got a forecast that my job is to forecast okay in economic life I told her what the only thing I can tell you is I can strongly recommend you get another job all right you can't I mean I can't I cannot go in and solve people's problems I'm not a dentist you know will you give me your teeth and tell us problem is I have general worldview that is and to fit my worldview I'm a skeptic I'm a skeptical and persist I cannot okay tell people what to do right I can tell people you have to extend tails so here I'm in a Silicon Valley I can tell you very easily don't read Harvard Business School papers typically because I find mysteries common mistakes and among all of them they take like the biotech all right industry and they say well you know what only one company makes money if you take out bio engine or the other engine in tech you know they don't make money but of course if you take out the lottery winner a lottery is so ok the other technique is an a Black Swan domain conventional metrics of looking at a pool of results as indicative of future results is inherently flawed without extending like biotech of course is not going to work okay in small samples okay because the small sample the past does not have a cure for baldness for example I know a few here it definitely makes a company rich okay if there's a cure for baldness all right I'm not the only one know there's some my season shining things in the crowd so there is so extending into what you don't know okay so some industries like biotech venture capital stuff like that you extend the right tail in other words if if the Black Swan happens it can only benefit them insurance company if a Black Swan happens it can only hurt them so it's very simple a rule of thumb of not trusting returns for banks okay and under estimating return for venture capital firms stuff like that small rules of thumb also of course not take advice from someone wearing a tie and stuff like that okay the and I'm sure people ask me for more so I'll leave it for the Q&A another thing I did discover in the Black Swan is that if we have small probabilities that have dominated our planet okay therefore they got to be survival advantages to those who had long memory sure enough there's a paper showing why Metron had you know that elephants are Matrimonial the ladies dominate and then old ladies are kept around guess why because they remember droughts they remember what happened in 1906 alright and why they had to go to find water okay so remember rare events okay so there is and societies have used that for a long time okay Senate for example Senate - you know it means an old person okay suppose you have a council of elders have some you know this is why I tries to look older than my age with my grey beard right have conservative but even in Arabic the term Shae means an old person alright so there is a value in society for keeping around people who are not productive simply as advisors on rare events if that happens were to go okay so this is locally there is something what I call knowledge without a cause okay these people have a lot of knowledge they don't have theories in economics we have the exact opposite for example we have crises like the subprime happen we had the same one eighteen years ago or a little less okay in 1990 eighteen years ago Wow time flies it we had the same one but nobody remembers it because they simplified two models so they don't store they so they store the theories instead of storing the facts which is what I call every diet and parasitism as opposed to it without was that inductive generalization just store the facts and a theory is destroy that and finally this okay leads to I was talking about them precautionary principle no it's not precautionary super precautionary principles is giving some respect to the just member okay of the planet the planet itself okay there are some rules don't mess with complex system because we don't understand them we don't see a link between we don't understand what's going on and the planet is smarter than us there's a topic of my next book is how we're lot better at doing that knowing okay the difference between explicit and implicit knowledge and we're better at heuristics than theorizing theories we do that for entertainment I think and then we give to assess illusion like universities look at the track record they're a lot better at a PR tell me whether it's cuz they're not really do anything it's sort of like you take birds you lecture them how to fly and then they fly and you explain you know the miracles of aerodynamics okay so the yeah so we have I mean of course they contribute but not we are a lot better doing why because of evolution and this is okay this is the works of evolution alright what we have on is planet the result of things have been longer than us and it knows a lot more than we do when I go back to the medical empiricists these people hyper skeptical but get what one thing they did is they respected tradition and age and age old practices even if they didn't make sense to them in other words you had to have the default is to go with what was done rather than you needed to override the default likewise it leads me to hyper conservatively called you know approach to ecology you don't have to explain why you don't want it to loot you don't want to explain come up with some theories particularly if the series can be fragile to someone like me who can go in and show how you can you know show errors and all these forecasting models to justify not not not polluting okay thank you very much I think I'm done III said a lot of things crammed them in 50 slides and thanks I stay here we get the house lights up a little bit so speaker can see the audience we can see each other see a little more about the sequence of events in your trilogy the first book of the book that you mostly talked about tonight in the next book yeah no the first book is not an interesting book it's called fooled by randomness but is I wrote it you know like half when I was half trading half you know honest when I wanted to kill time and it was not very deep so I managed you know what I managed to rewrite the same book for the Black Swan nobody I realized not a publisher said oh it's the same book and I explained to them that people go to church every Sunday to listen to the same story alright so the so I rewrote it I wrote it in a more intelligent way with the second one but but and and now I'm rewriting the whole thing a third time completely differently as I said focusing on in like I'm thinking empiricism to the limit knowledge without a cause I don't believe in knowledge and I'm discovering things after the Black Swan I I met a lot of people who who gave me evidence that things like the clinical trials we think that that's why the person was looking for in fact no they retrofit their story and and and and stuff like that so my next book is going to be the more drastic drastic you know because I'm going to make more enemies now already have only economists as enemies the rest this is a crowd that's not very hostile I was tomorrow the house is going to be very hostile anybody in finance typically is I mean they have this Phil tetlock observed he says there's a huge cognitive how do you call it dissonance cognitive dissonance listening to me because either I'm right and what they're doing is wrong or I mean you know I gotta be a nut all right or something like that so they of course I go for a second option so but they at the same time they don't feel comfortable to say well I have no argument against it so so next time I think anybody in academia or a lot of people in academia will have this will have this you know animosity towards me yeah what enemies of the current work surprised you enemies of what sorry of the current work what who was scandalized by this book that's correct well economists because I explained number one is I use arguments very simple argument against the science of economics but by explaining that they're dangerous to society and stuff like that and and they're forecasting we rely on it and and I say okay if you go to church it's a lot better than listen to them they got angry and also there are other things I did with Mandelbrot's we went into a full pronged attack on economics established by showing that the statistics are are off and we went after the Nobel and now we're going hunting down the Nobel Committee okay so so we so these people are not very happy when we call them charlatans but I'm explain to me what makes them different from astrologists there's no empirically they're the same but there was also far more elegant right so that was when we use these arguments I got very angry let me tell you there's funny stories I was in Paris at Ecole Polytechnique where I was speaking and I stood up and at some point I got emotional all right and they were all they're all mathematician almost and I stood up and said using these techniques typically the bell curve to measure risks is not even silly it's immoral immoral I said so stop shouting right there's a gentleman who's from the French edges to the I'm member of French Academy of Science and so on it was a scandal so I had to stop that was that was my best episode all right a bunch of quick questions here I'm able to get quick answers first ones from Sequoia hacks where is Sequoia an axe is that a real name probably not what's going on that's the threshold between extremists and and mediocrity and okay the the that's that's a an interesting question a lot of people have dealt with extremists and madeira stands somewhat in statistical physics where they you know if people talk about critical point bareback spoke about criticality that generates power laws it's not my point my point is very simple that Pi Lambda representation causes me to assume extremists and as an extension of unobservable so it's a pistol article I mean in the end I'm nothing but a philosopher okay and I'm sceptical philosopher I cannot use I cannot make a statement about transition points the other statement I'd like to make is a statement about dynamics force aesthetics people are very good at trying to explain things using dynamics because you get tenure by showing complicated mathematical paper there have been a lot of papers on the dynamics that generate extremists and starting with zhu-li about bacterial population something called preferential attachment buys if and assignment right by a lot of papers showing you know showing a rich get richer big gets bigger matthew affects the poor get poorer because he gives his mind to the rich okay now all these models are very simple okay but they don't explain the world because of Google guys right came out of nowhere and the big guys tend to die okay so they can't explain why the sp500 today only 75 companies survive the last four years okay if big gets bigger we should have one big company on earth okay so what do you have to do to improve these models is start adding a twist that makes company and go bust when you get very big and come back to my non-linearity now have an infancy infinitive models and much smaller set from which to calibrate and it's going to be difficult here's an Internet question from Mike will the internet and internet connectedness in general bring us more toward winner-take-all extremists an or with its empowerment of the amateur more toward mediocrity unfortunately going towards winner-take-all extremists an more and more I'm sorry to say that this is this is this is life but it's a very destructive extremist and when I looked at the the what the Internet has created is at the same time that it created a winner-take-all effect it created the pool of future winners coming to destabilize the top that's the long tail of my friend Chris who got me invited here I mean actually a Philip tetlock got you and Phil tetlock okay thanks the the the the idea of having a pool of people destabilizes so the dynamics are you more complicated so you have an extremist and it's not the same winner every time now the good look at it look how short was the road from zero to Alta Vista back to zero okay and now it was from zero from college dorm to Google back to a no sorry so you understand what I mean by the stable unstable its extremists and more and more and more and more unstable do you ever buy stock no I thought I mean I buy okay but let me tell you the idea portfolio for someone who doesn't understand anything about the world statement I can make is have the maximum amount of zero securities and small amount and maximum risk securities so I have a medium risk portfolio but I'm not making any claim okay as to my tail beyond say my loss so I have a 7% invested that's all I can lose all right so I'm not making a statement on future you know and let me tell you one thing in finance when they say they can make tail events can measure tail events when they say a risk and measure the risks past risk don't predict future risks that's the first thing that shocked me best risks do not predict future risk so you don't know I mean oh this is all very verbiage about stock market measures a risk speaking of stock markets we had a question here from Oliver how do you explain warren buffett's record this is come back to my picture of the problem of survivorship bias or the problem of a cemetery okay I have my watch even if it's you know a broken clock can be right twice a day alright so if you have a lot of investors you're necessarily it's a necessity to have a Warren Buffett simply out of luck now I'm not I don't mean he is lucky I'm saying I have I'd like to withhold judgment the only person I say there only two people I think who are not lucky there's no luck now I'm not saying he's necessarily lucky I say I don't know because randomness you have so many people trading you necessarily will produce someone like that the only two people are Soros but don't tell him all right and then there is the other gentleman from Renaissance okay Simon's he's not he's not lucky beyond he is he is definitely but what he does he's not he's not speculator he's just like some more Walmart stock you know taking liquidity from one market to the other there's no exposure to uncertainty in his models so from max a question is what does extremists and say about the power of the individual to influence events unfortunately it says two things just like the same thing as a butterfly you know the story the butterfly a butterfly in India flapping its wings it's that's a metaphor for a chaos theory okay can generate a you know snowstorm and Tahoe okay but as it's saying but how many butterflies are they in India right how many things like butterflies in India or snails and Guatemala all right so you have a lot of small things okay so the I don't know the problem that you have is at the individual level it's a winner-take-all effect so you have to realize that they have a huge decoupling between skills skills are necessary I'm not saying they're not necessary they're necessary but can lead you know where an extremist and it would dentists any medium skilled dentist okay any dentist can can survive okay but but in in in I know from writing you have a million manuscripts of novels floating around okay I'm sure they're Marvel's in there it's extremist and only if you were to be published that's it well that may be a little different with the internet question because the eyeball issue the books get looked at by not very bright not right you're right so outside and stuff in blogs and online and Kevin Kelly's instead of publishing a book is doing all this stuff basically as a sequence of blog items there's a in Chris Anderson did his book the long tail pretty much online before he did it as a book I say so there you're getting a much larger it's more than a sample that you're getting a lot of human intelligence focused on something you're interested in or making a book which is both good and popular which is that a different world I think for nonfiction and the world of ideas in our world you probably the online reduce the randomness of you know if you're smart how I did my first book football renin nobody wants to publish it nobody all right because I have fictional characters in my book okay and then you know I have the rejection letters if you want you know I can you know show you there's a lot of fun to read them okay after fact they explain to you why they're not why it's gonna be a flop alright and fubar end result hundreds of thousands copies so the the I left it on a web and someone picked it up from the web so so you're right but it was sort of like an idea book an idea idea books ideas that they find their way but novels or nonfiction is not the same that you have you the the consciousness our consciousness cannot Harbor too much too many works of Arts it's limited that's what creates these the power loss is too limited our consciousness is too narrow and getting narrower is why we have Harry Potter okay this is a show the English and now everything is moving to the English language California something does Cal for it so ever since concentrating you see in our knowledge of line of languages are dying by the minute and because of extremists an English winner-take-all they took everything and it's easier to communicate you know in the same language yeah you're a polyglot and I'm sorry ten languages or so I'm not comfortable in ten languages whatever it's not that languages don't I mean you read them you don't use them but the idea of the first of all languages survived by luck okay English is probably the worst possible language okay so have as world language and it's becoming nothing it was bad English it becomes the world language Citibank English we call the the spreading okay because of a piece of luck and then start spreading that's it this is why we don't have Esperanto sore several Croatian as the world languages just as they say the language of science heavily accented English the but the perspective you bring has a feeling to me of coming from enough different angles that your comfort in a number of different languages is that some part of your own mental heuristic that you can think more strangely than I know it's just interested in languages because folks Alan breed I was reading the text ok we see translations they don't mean the same thing like for example very simple stress I mean interests in religion now and and and if you know a little bit of Greek you just realize that the credo doesn't mean I believe in God created be stable be stable means I just complete different statements so there's no statement of belief belief is something for extremely modern and now is translate it was translated to belief so knowing languages sometimes allow you to see nuances and words Arabic it's definitely a potent form a lot of the medieval texts like come from from went via Arabic will transfer via Arabic and he had a lot of mistranslation of of things what's your interest in religion my interest in oh it's coming my I have an interest in belief I'm sorry belief alright belief because I think belief plays a role mmm okay belief is an estate for an stamen I think that at the end I was trying to explain to myself and shower what was it that I wanted to do next and try to just realize that we're not that different from planets when you go to the zoo except for our brain and it didn't go very far so I mean this is I mean you see it in daily life instead so that's sort of my point so and and we so this is why I had an interesting belief is still skin deep the other problem in evolution is that I think the mind does not like the vacuum that our mind doesn't matter I forgot the there's not like a vacuum so you instead of religion has worked I'm conservative has worked for a long time to fill that vacuum and it works a lot better than science or science so you're suggesting that one way of finessing and a lot of the illusions of rationality you've been talking about is basically belief no no my point about no I'm not I don't recommend but little additionally I'm saying sorry tradition with that I'm saying that that if you remove religion from people's brains they get into something vastly worse nationalism could a lot more people or economics you know something stuff like so you have so you got problems so this is my my or social science or psychoanalysis you see so you might as well keep them to religion and it comes back to a statement made that was the esoteric you know the problem of agarose which was taken by Spinoza later I've always said what was he trying to do was with religion or okay he said it's very simple if you explain Aristotle to the common person he or she won't get it so we got to tell him what to do therefore the religion place of all that was either always okay the biggest thinker of medieval Islam okay and later on was taken by by Spinoza was an esoteric exoteric by saying the Bible is therefore for a purpose because it's a good story for people who don't have the intellect to understand what I understand you know that was his statement okay and in different terms of course so the idea of religion for the masses all right the opiate of the masses right as I remember and said the the stock market the opiate for the middle class I'd rather give them back their okay all right I don't need it but I'd rather given that opiate and give him some other you know opiate that vastly more dangerous that's my that was my mine but if you can do without this it's okay if you can all right odds are people can't raises to the question how he can be a skeptic without being a cynic do they go together I I mean people call me iconoclastic but I have some huge devotion to some people like Mandelbrot or some other people so it's I have different icons cynic I don't know I mean there's some people I despise and you say it I'm uncompromising it's easier to say to explain uncompromising say these things the way they are without mincing words and you stick to it so you get some heat it's okay alright keep sticking to it particularly that that I was lucky not to have been an academic from the start because when you're I can't even start you socialized so you're afraid of offending this guy I have no allegiance look guys no you know no even so friends that's okay you know I give and if I feel guilty to give money to charity then okay question from Nicole Boyer how does focus on black swans affect quality of decision making does it increase paralysis or inaction that's exact the opposite it makes you take a lot more risk on some domains I take a lot more risk on some domains if you know if you're aware of like Swan focus your is taking on some things not others it makes you a lot take a lot more risk in thinker in trial and error and a lot less risk with when you rely on someone's opinion who can be for experts so it's what makes me take a lot more risk and a lot of drug I think a lot of a lot of risks I'm not afraid of risks that some other people are in vice versa okay I'm afraid of stock market I don't understand it I don't think anybody else does by the way based on track record so I don't take that risk but there are other risk I take okay Kevin Kelly handles the questions she handed me one by himself Sheen therapy is a drastic unknown technology for an example we have millions of years of experience with breeding in a sense and maybe eight thousand years of serious breeding and zero experience with engineering life so craig Venter will be here in a couple of weeks should we not dare engineer life should we be do this but don't dare predict it to see what happens see predict about possibilities but don't believe what our predictions say or D go ahead and predict ok I they're gonna be dinner no the problem I have is I cannot I they're so little I know I only talk about things I know this if you knew would should we do something in there I know I have no idea but no I I think I mean I'm a skeptic and highly paranoid skeptic alright was things I don't understand but I don't want to you know make a statement on the subject but I'm not familiar with the whole background I don't know but if you want to talk about invasions I'd be ready to talk but not this all right let's go to one you know Neil Ferguson Peter Schwartz here has a question Neil Ferguson with his counterfactual histories uses multiple interpretations of histories allowing for invisible evidence to develop an alternative scenario said a way of dealing with black swans yes definitely I he and I are I mean the same thing if you have the same he the first person to understand my book he was the first person to write about my book and say this guy I felt understood after reading him so he understands counterfactual history alternative scenarios it can take the visible you have to take unfeasible what could have happened let's not stick to the observed but whenever you have non-observable outcome wouldn't have happened to have rich review of history so this is this I agree my view of counterfactual makes us even more makes the interpretation of historical events even more fragile to error okay then then so it's hard to be a historian but but I think I agree but from that step with this counterfactual yes the introduction of cost factual probably most this audience is going to vote tomorrow we're having this election from the primaries what's looking statistically at voting which what's your sense of that's all about III haven't read the papers not in terms of outcome just the event itself what is voting I don't know iiiiii so little I know all right but but what I know I know definitely I'm comfortable with III don't know a thing about I mean I'm not like a lot of people ask me about things I know no clue and and this is it and in one of thing the Black Swan I say learn have the guts to say I don't know write this I know nothing I definitely not vote for Hillary if you want my hands that leave John McCain sorry McCain no I'm not the different I know I'm not voting for I don't know the rest Romney no no no definitely not making a statement physical statement you can try you could try all you want just out of curiosity Longwood I needs real drinks you know the the ballot is secret but how many here are voting for Romney Wow okay good a couple how many for McCain okay how many for Barack Obama not surprised how many for Hillary Clinton about half as many okay so you see I I would you have predicted that no no Ron Paul right ball right in are you still in it no definitely I'm not voting for Ron Paul that's how many here can't vote that's interesting Wow okay Thank You Ryan this good question that's a lot of people I'm sorry this is so the lien on the person next to you and that tells me the proportion of mathematicians here foreign mathematicians in the crowd for quantity so this was wonderful Nicene thank you so much thanks a lot thanks for inviting [Applause] [Music]

Channel: Long Now Foundation

Views: 49,732

Rating: 4.943079 out of 5

Keywords: Culture, Statistics, Prediction, Outlier, Black Swan, probability, Psychology, information, confirmation bias

Id: Qxvgm17COj4

Length: 88min 4sec (5284 seconds)

Published: Mon Mar 16 2020