Taleb & Teller

I love Nassim Nicholas Taleb, he's my boy. He made a gajillion dollars in the market and retired to hang out in his library and write books of skeptical contrarianism. He is living my dream and how can I not respect the hell out of that? And he's a genuinely engaging writer. The Black Swan is more than just a snooty math text (although it is a bit of that). It employs some interesting techniques like fictional characters (in an homage to Kundera) and anecdotes where political events mirror market events to keep the story from turning dreary. It's a very readable book. When I got a chance to see him live up in Louisville, I took the morning off and headed up there.

As a public speaker he is clumsy, even after all his time giving the same power point lecture, he's smart but not terribly charismatic. Even his attempts at humor fell flat: jabs at Frenchmen probably work just about everywhere in America but his Levantine sensibility has a depth that just doesn't translate to Louisville, Kentucky. He reminds me of Philip K. Dick in that sense: fascinating ideas ineffectually presented.

During the Q&A period, a woman got up and in a pleading voice asked him to guide us. She wondered how we were to take this skepticism and turn it into a bold idea--we were at the Idea Festival, after all. Of course he had no worthwhile reply (some blather about teaching history without theory attached to it, which is quite a bit less possible than it sounds). I wondered whether she felt vindicated for sticking the stuffed shirt or bewildered at how this obviously capable thinker could fail to formulate a plan. I suspect it was the latter which will eventually morph into the former because go-getters like her just cannot comprehend that intellectual avenues are dead ends--even the useful ones! All of them without exception from thermodynamics to nutrition to economics to religion, where did they go? You get innovation and then confusion, then you hope for more innovation. But philosophy is a bitch goddess: for nuclear power you get nuclear weaponry; for technology driven capitalism that gives the economy an enormous boost comes credit default swaps that can rare up and snatch all the gains back in one big gulp; for Ruth, Mays and Aaron you get McGwire, Sosa and Bonds; for Shrodinger's cat you get that same cat's corpse. Bitch goddess, whadda ya gonna do?

We often hear wags say things like 'The language of the universe is math!' Utter hogwash. We didn't discover math, we invented it! We invented the number line and created its parameters and internal logic and imposed it on the universe. Lo and behold it (generally) works! Yes but that's because the universe is so infinitely fucking huge that you could impose any kind of logical graffiti on it and eventually find some positive rejoinder. If a 'week' was 8 days, our entire calendar would be different but we'd still proclaim that it was perfect. If a foot was 14 inches instead of 12, our observations and calculations would be different and yet just as realistic. We invented the rules and the logic--we could've invented anything and told ourselves it was what God wanted us to find!

But that don't mean the universe is always going to catch us when we fall.

On the other hand, we didn't invent the economy, we discovered it. Laws of supply and demand transcend us and we can only hope to fumble our through this material world. The math is only as good as its inputs--and you can't put in everything there is. Our knowledge is always necessarily limited. Ignorance is our true state of being and striding through the markets like a 'Master of the Universe' (totally digging Bonfire of the Vanities right now), is hubris waiting to get brought low. Mortgage derivatives react differently when the market it going up as to when its going down, found that out the hard way.

Afterwards I was able to see Teller (aka Penn's better half). He began by talking of magicians who give their tricks away (a trademark of Penn & Teller among others) and suggested that the real trick was not giving away as much as you think. Then he showed a video of a routine he does in the current Penn & Teller show. It is a quaint piece where he is able to make a ball follow him around the stage, roll up a bench, jump through hoops and all sorts of other curious maneuvers. He wondered aloud if we would appreciate the routine better if we knew how he put it together. He then gave the history of the ball illusion (a legendary magician from a century ago), how he pulls it off (two strings attached to the wall) and even his aesthetic choices of how to build his own routine from this old timey chestnut. It was all very entertaining and when he mixed in a trick or two while he spoke, it was like seeing Dimaggio leg out an infield hit. Then he showed the video again and I gotta say, it was better the second time around. But mostly what struck me was it seemed that he was doing things with the ball that he hadn't explained, making the routine all the more remarkable. Grand! In Mamet-like fashion he showed us a trick and then proceeded to trick us with it again. Good stuff.