*** The Black Swan: The Impact of the Highly Improbable, Nassim Nicholas Taleb, 2007
I was hipped to this book by a day-job client, Sean O'Toole of ForeclosureRadar.com. (By the way, incredible software those guys have. Just amazing.) I was so intrigued, I grabbed a copy for reading while working out. It passed the elliptical test with flying colors.
It's a book about prediction and how completely inept we are at doing it, even experts. Especially experts. It's about how watching the news actually makes you less informed. It's about the various ways in which we convince ourselves that "evidence" and "history" and "narratives" allow us to know what's going to happen, when it's impossible for us to know.
Here's an early example (page 40):
Consider a turkey that is fed every day. Every single feeding will firm up the bird's belief that it is the general rule of life to be fed every day by friendly members of the human race "looking out for its best interests," as a politician would say. On the afternoon of the Wednesday before Thanksgiving, something unexpected will happen to the turkey. It will incur a revision of belief.
He points out the futility of paying attention to predictions regarding things like the stock market or social phenomena when we can't even get basic construction estimating right, such as the astounding case of the Sydney Opera House.
While Australians were under the illusion that they had built a monument to distinguish their skyline, what they had really done was to construct a monument to our failure to predict, to plan, and to come to grips with our unknowledge of the future--our systematic under-estimation of what the future has in store.
The Australians had actually built a symbol of the epistemic arrogance of the human race. The story is as follows. The Sydney Opera House was supposed to open in early 1963 at a cost of AU$ 7 million. It finally opened its doors more than ten years later, and, although it was a less ambitions version than initially envisioned, it ended up costing around AU$ 104 million.
There's tons of good stuff in there, but that's enough to give you the idea. In case you're wondering, it does have a happy ending:
I am sometimes taken aback by how people can have a miserable day or get angry because they feel cheated by a bad meal, cold coffee, a social rebuf, or a rude reception. Recall my discussion in Chapter 8 on the difficulty in seeing the true odds of the events that run your own life. We are quick to forget that just being alive is an extraordiary piece of good luck, a remote event, a chance occurrence of monstrous porportions.
Imagine a speck of dust next to a planet a billions times the size of the earth. The speck of dust represents the odds in favor of your being born; the huge planet would be the odds against it. So stop sweating the small stuff. Don't be like the ingrate who got a castle as a present and worried about the mildew in the bathroom. Stop looking the gift horse in the mouth--remember that you are a Black Swan. And thank you for reading my book.
And here's a nice quote from the acknowledgements: Standardizing editors have an uncanny ability to inflict maximal damage by breaking the internal rhythm of one's prose with the minimum of changes.