CityReads│61 Books Nassim Taleb Recommends: 1-30

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61 Books Nassim Taleb Recommends: 1-30

Nassim Taleb, the polarizing author of best-selling books The Black Swan and Antifragile: Things That Gain from Disorder, offers 61 reading recommendations, which cover a wide variety of fields, including foreign affairs, economics, cognitive sciences, philosophy, language, novel, biography, history, geography, medicine, diets, etc. It is a long post. CityReads posts in two installments. Here is the list of the first 30 books.

Source: https://medium.com/the-mission/61-books-nassim-taleb-recommends-you-read-in-his-own-words-fc2e17a7f3c1

Picture source: http://www.fooledbyrandomness.com/

1. Perilous Interventions: The Security Council and the Politics of Chaos

Solid Book on Interventionism, Should be Mandatory Reading in Foreign Affairs. This is an outstanding book on the side effects of interventionism, written in extremely elegant prose and with maximal clarity. It documents how people find arguments couched in moralistic terms to intervene in complex systems they don’t understand. These interventions trigger endless chains of unintended consequences –consequences for the victims, but none for the interventionistas, allowing them to repeat the mistake again and again. Puri, as an insider, outlines the principles and legal mechanisms, then runs through the events of the past few years since the Iraq invasion; each one of his chapters are models of concision, presenting the story of Ukraine, Syria, Lybia, and Yemen, among others, as standalone briefings to the uninitiated. It was high time that somebody in international affairs has approached the problem of “iatrogenics”, i.e. harm done by the healer.

2. Idea Makers: Personal Perspectives on the Lives & Ideas of Some Notable People (5 Stars)

The general public is usually supplied by books on mathematical scientists written by “science communicators” and other outside observers–the worst by far being the academic historians of science. Their books are like reviews of comparative squid ink recipes written by anorexics, or descriptions of the Loire Valley by visually impaired travel writers. This book, “Idea Makers”, is written from an insider. It is the real thing on several accounts. Primo, Wolfram deserves to be in the book as an “idea maker”, in his own right. Secondo, Wolfram is the developer of a new way to do (useful) mathematics, an entirely new method, which allows us to tinker with mathematics, something that is an anathema to purists. Thus he depicts Ramanujan, not with the usual mathematical prism of the theorem crowds, but as someone who, starting with intuitions, does experiments till a mathematical identity feels right. As an eyewitness, I spent almost all my career in quant finance and probability toying with Mathematica (Stephen Wolfram’s invention), and saw it accumulate special functions and tools. Mathematica allowed me to be a car mechanic who looked under the hood.

3 The Secret of Fatima (5 Stars) 

Masterly! This is the page turner par excellence; every new page brings some surprise and it was impossible for me to put the book down. I even read some of it during elevator rides, not being able to resist. And truly sophisticated: Nobody but Peter Tanous would have imagined to cross James Bond with a Catholic priest.”

4. Birth of a Theorem: A Mathematical Adventure (5 stars)

This is a gem for a singular reason. One sees exactly how Villani (or a pure mathematician) goes from abstract to abstract without ever exiting the world of pure and symbolic mathematics, even though the subject concerns a very concrete real-world topic. I kept waiting for him to use simulations or even plots to see how the equations worked. But he did not … he and Mouhot had recourse to outside help (a student or an assistant) for the graphs and he camly noted that they “looked” great. Later in the book he relied on others to do the numerical work… as an afterthought. Most physicists, quants, and applied mathematicians would have played with a computer to get the intuition; Villani just worked with mathematical objects, abstract mathematical objects, and very abstract at that. Landau damping is (sort of) about how things don’t blow up because of some exponential decay. Proving it outside the linear version remained elusive. Villani and Mouhot set to prove it. They eventually do. I would have read the book in one sitting. It grips you like a detective novel.

5 Modern Aramaic-English/English-Modern Aramaic Dictionary & Phrasebook: Assyrian/Syriac (5 Stars)

There is no way we Levantines can learn the language of our ancestors in an organic way except via nerds insisting on 1) grammar, 2) writing in one of the unwieldy Syriac scripts that one cannot even read on a computer screen without dowloading strange fonts. But Aramaic is still spoken, let us take advantage of it, and figure out how to say “I want to eat mjaddara” rather than memorize poetry by some dead author. Aramaic isn’t a dead language and it is the shame Levantines study Arabic instead of our own heritage.

6 The Tyranny of Experts: Economists, Dictators, and the Forgotten Rights of the Poor (5 Stars)

The point that top-down development methods are great on paper but have not produced benefits (“so far”) is a point Easterly has made before, heavily influencing yours truly in the formation his own argument against naive interventionism and the collection of “humanitarians” fulfilling their personal growth and shielding themselves from their conscience… This is more powerful: the West has been putting development ahead of moral issues, patronizingly setting aside the right of the people to decide their own fate, including whether they want these “improvements”, hence compounding failure and turning much of development into an agenda that benefits the careers (and angst) of “humanitarians”, imperial policies, and, not least, local autocrats *without* any moral contribution. To put it in an aphorism, they didn’t ask the people if they would rather get respect and no aid rather than aid and no respect.

7 Modelling Extremal Events: for Insurance and Finance (Stochastic Modelling and Applied Probability) (5 stars) 

The mathematics of extreme events, or the remote parts of the probability distributions, is a discipline on its own, more important than any other with respect to risk and decisions since some domains are dominated by the extremes: for the class of subexponential (and of course for the subclass of power laws) the tails ARE the story. Now this book is the bible for the field. It has been diligently updated. It is complete, in the sense that there is nothing of relevance that is not mentioned, treated, or referred to in the text.

It is also a book that grows on you. I would have given it a 5 stars when I started using it; today I give it 6 stars, and certainly 7 next year. If I had to go on a desert island with 2 probability books, I would take Feller’s two volumes and this one.

 8 The Kelly Capital Growth Investment Criterion: Theory and Practice (5 Stars) 

There are two methods to consider in a risky strategy.

1) The first is to know all parameters about the future and engage in optimized portfolio construction, a lunacy unless one has a god-like knowledge of the future. Let us call it Markowitz-style. In order to implement a full Markowitz- style optimization, one needs to know the entire joint probability distribution of all assets for the entire future, plus the exact utility function for wealth at all future times. And without errors!

2) Kelly’s method (or, rather, Kelly-Thorpe), developed around the same period, which requires no joint distribution or utility function. It is very robust. In practice one needs to estimate the ratio of expected profit to worst- case return– dynamically adjusted to avoid ruin. In the case of barbell transformations, the worst case is guaranteed (leave 80% or so of your money in reserves). And model error is much, much milder under Kelly criterion. The entire focus is the avoidance of gambler’s ruin.

The first strategy was only embraced by academic financial economists –empty suits without skin in the game — because you can make an academic career writing BS papers with method 1 much better than with method 2. On the other hand EVERY SURVIVING speculator uses explicitly or implicitly method 2.

Let me repeat. Method 2 is much, much, much more scientific in the true sense of the word, that is rigorous and applicable. Method 1 is good for “job market papers” . Now this book presents all the major papers for the second line of thinking. It is almost exhaustive; many great thinkers in Information theory and probability (Ed Thorpe, Leo Breiman, T M Cover, Bill Ziemba) are represented… even the original paper by Bernouilli.

This book has more meat than any other book in decision theory, economics, finance, etc…

9 A Few Lessons from Sherlock Holmes (5 Stars) 

We Sherlock Holmes fans, readers, and secret imitators need a map. Here it is. Peter Bevelin is one of the wisest people on the planet. He went through the books and pulled out sections from Conan Doyle’s stories that are relevant to us moderns, a guide to both wisdom and Sherlock Holmes. It makes you both wiser and eager to reread Sherlock Holmes.

10 The Science of Conjecture: Evidence and Probability before Pascal (5 Stars) 

Indispensable. As a practitioner of probability, I’ve read many book on the subject. More are linear combinations of other books and ideas rehashed without real understanding that the idea of probability harks back the Greek pisteuo (credibility) and pervaded classical thought.

Almost all of these writers made the mistake to think that the ancients were not into probability. If the ancients were not into computable probabilities, it was not because of theology, but because they were not into games. They dealt with complex decisions, not merely probability. And they were very sophisticated at it.

This book stands above, way above the rest: I’ve never seen a deeper exposition of the subject, as this text covers, in addition to the mathematical bases, the true philosophical origin of the notion of probability. In addition Franklin covers matters related to ethics and contract law, such as the works of the medieval thinker Pierre de Jean Olivi, that very few people discuss today.

11 Probability, Random Variables and Stochastic Processes (5 Stars)

When readers and students ask to me for a useable book for nonmathematicians to get into probability (or a probabilistic approach to statistics), before embarking into deeper problems, I suggest this book by the Late A. Papoulis. I even recommend it to mathematicians as their training often tends to make them spend too much time on limit theorems and very little on the actual “plumbing”. The book can be used as a desk reference.

12 Mathematics: Its Content, Methods and Meaning (5 Stars)

There is something admirable about the school of the Russians: they are thinkers doing math, with remarkable clarity, minimal formalism, and total absence of unnecessary pedantry one finds in more modern texts. This is of course surprising as one would have expected the exact opposite from the products of the communist era. Mathematicians should be using this book as a model for their own composition. You can read it and reread it. Professors should assign this in addition to modern texts, as readers can get intuitions, something alas absent from modern texts.

13 Probability Theory (Courant Lecture Notes) (5 Stars) 

I know which books I value when I end up buying a second copy after losing the first one. This book gives a complete overview of the basis of probability theory with some grounding in measure theory, and presents the main proofs. It is remarkable because of its concision and completeness: visibly prof Varadhan lectured from these notes and kept improving on them until we got this gem. There is not a single sentence too many, yet nothing is missing.

For those who don’t know who he is, Varadhan stands as one of the greatest probabilists of all time. Learning probability from him is like learning from Aristotle. Varadhan has two other similar volumes one covering stochastic processes the other into the theory of large deviations. The book on Stochastic Processes should be paired with this one.

14 Models.Behaving.Badly.: Why Confusing Illusion with Reality Can Lead to Disaster, on Wall Street and in Life (5 Stars) 

Emanuel Derman has written my kind of a book, an elegant combination of memoir, confession, and essay on ethics, philosophy of science and professional practice. He convincingly establishes the difference between model and theory and shows why attempts to model financial markets can never be genuinely scientific. It vindicates those of us who hold that financial modeling is neither practical nor scientific. Exceedingly readable.

15 Body by Science: A Research Based Program to Get the Results You Want in 12 Minutes a Week (5 Stars) 

I feel guilty for not having posted a review earlier: I owe a lot to this book. I figured out the value of intensity training and maximizing recovery. I use the ideas but with minor modifications. I have been applying the ideas for more than three years. Just get over the inhibitions (and illusions of control) and accept the idea of training less.

Gratitude.

16 The Hour Between Dog and Wolf: Risk Taking, Gut Feelings and the Biology of Boom and Bust (5 Stars)

I read this book after completing my exposition of overcompensation, how a stressor or a random event causes an increase in strength, in excess of what is needed, like a redundancy. I was also looking for evidence of convex reaction to stressor, or the effect of a mathematical property called Jensen’s inequality in domains and found it exposed here (in other words, why a combination low dose (most of the time) and high dose (rarely) beats medium dose all the time. The authors presents the evidence for the phenomenon in the following: 1) acute stressors cum recovery beat both absence of stressors and chronic ones; 2) stressors make one stronger (post traumatic growth); 3) risk management is mediated by the deep structures in us, not rational decision-making; 4) winning causes an increase in strength.

Great book. I ignored the connection to financial markets while reading it. But I learned that when under stress, one should seek the familiar. Bravo!

 17 The Opposing Shore (5 Stars)

Until I read this book, Buzzati’s “Il deserto dei tartari” was my favorite novel, perhaps my only novel, the only one I cared to keep re-reading through life. This is, remarkably a very similar story about the antichamber of anticipation (rather than “the antichamber of hope” as I called Buzzati’s book), but written in a much finer language, by a real writer (Buzzati was a journalist, which made his prose more functional) ; the style is lapidary with remarkable precision; it has texture, wealth of details, and creates a mesmerizing atmosphere. Once you enter it, you are stuck there. I kept telling myself while reading it: “this is the book”. It suddenly replaced the “deserto”.

18 Bull by the Horns: Fighting to Save Main Street from Wall Street and Wall Street from Itself (5 Stars)

We have the account of a person who says it the way it was, revealing the types of truths that don’t fit the New York Times and others pawns. When history is written, this will be used, not the spin by the bankers’ slaves and soldiers (Geithner, Rubin et al.) Bravo Sheila!

19.  Information: The New Language of Science (5 stars) 

If you want an introduction to information theory, and, in a way, probability theory from the real front door, this is it. A clearly written book, very intuitive, explains things, such as the Monty Hall problem in a few lines. I will make it a prerequisite before more technical great books, such as Cover and Thompson.

20. Free The Animal: Lose Weight & Fat With The Paleo Diet (5 stars)

A charming primer on the paleo idea, with an illustration through the authors own life. I read it in one sitting.

21.  Why Everyone (Else) Is a Hypocrite: Evolution and the Modular Mind (5 stars)

This is a great synthesis of the modularity approach to cognitive science. It covers the entire field and has the right footnotes for the patches.

The style is readable, & the author has an attitude. While I strongly disagree with his treatment of morality (I am deontic), I can safely say, so far, that this is not just one of the best books in cognitive science, but certainly one of the most readable.

22.  Explaining Social Behavior: More Nuts and Bolts for the Social Sciences (5 stars) 

I read this book twice. The first time, I thought that it was excellent, the best compendium of ideas of social science by arguably the best thinker in the field. I took copious notes, etc. I agreed with its patchwork-style approach to rational decision making. I knew that it had huge insights applicable to my refusal of general theories [they don’t work], rather limit ourselves to nuts and bolts [they work].

Then I started reading it again. I realized it had another layer of depth –and the author distilled ideas from the works of Proust, La Rochefoucault, Tocqueville, Montaigne, people with the kind of insights that extend beyond the ideas, and that makes you feel that a reductionist academic treatment of the subject will necessary distort it.

23.  The Discovery of France: A Historical Geography from the Revolution to the First World War (5 stars) 

This is the most profound examination of how nationality is enforced on a group of people, with the internal colonization process and the stamping out of idiosyncratic traits. As someone suspicious of government and state control, I was wondering how France did so well in spite of having a big government. This book gave me the answer: it took a long time for the government and the “nation” to penetrate the depth of deep France, “la France profonde”. It was not until recently that French was spoken by the majority of the citizens. Schools taught French but it was just like Greek or Latin: people forgot it right after they finished their (short) school life. For a long time France’s villages were unreachable.

A great book, a great investigation.

24.  Good Calories, Bad Calories: Challenging the Conventional Wisdom on Diet, Weight Control, and Disease (5 stars)

Gary Taubes is a true empiricist. I can’t believe people hold on to the Platonicity of the thermodynamic theory of diet (calorie in = calorie out).

Read it twice, once for the diet, once a a rich document in the history of science.

25.  Plato and a Platypus Walk into a Bar: Understanding Philosophy Through Jokes (4 stars)

I read Plato and the Platypus by Umberto Eco, which I found brilliant and was sucked into buying this book thinking it was about the same problem of categories. But Philosophy this is not, or if it is, it is not deep enough to give satisfaction. This is like a brief drink in an airplane lounge with someone funny, smart, witty, but not too funny. So I would give it my lowest rating: 4 stars.

26.  Seeking Wisdom: From Darwin to Munger, 3rd Edition (5 Stars)

A wonderful book on wisdom and decision-making written by a wise decision-maker. This is the kind of book you read first, then leave by your bedside and re-read a bit every day, so you can slowly soak up the wisdom. It is sort of Montaigne but applied to business, with a great investigation of the psychological dimension of decision-making. 

27.  The Doctrine of Deification in the Greek Patristic Tradition (5stars)

I initially bought this book as I was curious about the differences between Eastern & Western traditions, particularly with the notion of theosis –the deification of man. This book goes far deeper, and covers pre-Christian practices (like Stoic thoughts, the deifications of Kings, Roman Emperors, that of private citizens who committed symbolic acts –such as Antinous, Hadrian’s obsession, who drowned to “save” mankind and other sotirologies).

The book was initially Russell’s doctoral thesis, which, as far as I can guess from the dates, had to have been completed when he was in late middle age. But he made it very readable, free of the theophilosophical jargon of similar texts. He still has quotes in the original language and it is a true piece of scholarship.

28.  Statistical Models: Theory and Practice (5 stars)

I spent my life focusing on the errors of statistics and how they sometimes fail us in real life, because of the misinterpretation of what the techniques can do for you. This book is outstanding in the following two aspects: 1) It is of immense clarity, embedding everything in real situations, 2) It uses the real-life situation to critique the statistical model and show you the limit of statistic. For instance, he shows a few anecdotes here and there to illustrate how correlation between two variables might not mean anything causal, or how asymptotic properties may not be relevant in real life.

This is the first statistics book I’ve seen that cares about presenting statistics as a tool to GET TO THE TRUTH.

29.  Happy Accidents: Serendipity in Modern Medical Breakthroughs (5 stars)

Controlled experiment can easily show absence of design in medical research: you compare the results of top-down directed research to randomly generated discoveries. Well, the U.S. government provides us with the perfect experiment for that: the National Cancer Institute that came out of the Nixon “war on cancer” in the early 1970s.

“Despite the Herculean effort and enormous expense, only a few drugs for the treatment of cancer were found through NCI’s centrally directed, targeted program. Over a twenty-year period of screening more than 144,000 plant extracts, representing about 15,000 species, not a single plant-based anticancer drug reached approved status. This failure stands in stark contrast to the discovery in the late 1950s of a major group of plant-derived cancer drugs, the Vinca Alcaloids -a discovery that came about by chance, not through directed research.”

From Happy Accidents: Serendipity in Modern Medical Breakthroughs, by Morton Meyers, a book that just came out. It is a MUST read. Please go buy it. Read it twice, not once.

We did not realize that cures for cancer had been coming from other brands of research. You search for noncancer drugs and find something you were not looking for (and vice versa). We urgently need to rewrite the history of medicine without the ex post explanations. Meyers started the process: he provides data for modern medicine since, say, Pasteur. I am more interested in the genesis of the field before the Galenic nerdification.

29.  Financial Derivatives: Pricing, Applications, and Mathematics (5 stars) 

One of the author, Baz, gave me a copy of this book when it came out and it went to sleep in my library as I was not in a finance mood. I forgot about it until this week as I was stuck on a problem related to risk-neutral pricing and the Girsanov theorem concerning changes in probability measure. I looked at every passage on the subject until I hit on it. Then I realized that I should have read it before: it is a condensed, but extremely deep , and complete exposition of the subject of theoretical finance. No financial book has the clarity of this text.

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