Everyone wants to succeed in life. But what causes some of us to be more successful than others? Is it really down to skill and strategy; or something altogether more unpredictable? This book is about the way you think about business and the world. It is all about luck: how we perceive luck in our personal and professional experiences. Nowhere is this more obvious than in the markets: we hear an entrepreneur has vision or a trader is talented, but all too often their performance is down to chance rather than skill. It is only because we fail to understand probability that we continue to believe events are non-random, finding reasons where none exist.

(#Ad) Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets deals with the fallibility of human knowledge. It was first published in 2001. Updated editions were released a few years later. The book is the first part of Taleb’s multi-volume philosophical essay on uncertainty, titled the Incerto, which also includes The Black Swan (2007–2010), The Bed of Procrustes (2010–2016), Antifragile (2012), and Skin in the Game (2018).

45 BEST QUOTES FROM FOOLED BY RANDOMNESS

“Heroes are heroes because they are heroic in behavior, not because they won or lost.” ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“Charm is the ability to insult people without offending them; nerdiness the reverse” ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“Reality is far more vicious than Russian roulette. First, it delivers the fatal bullet rather infrequently, like a revolver that would have hundreds, even thousands of chambers instead of six. After a few dozen tries, one forgets about the existence of a bullet, under a numbing false sense of security. Second, unlike a well-defined precise game like Russian roulette, where the risks are visible to anyone capable of multiplying and dividing by six, one does not observe the barrel of reality. One is capable of unwittingly playing Russian roulette – and calling it by some alternative “low risk” game.” ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“Probability is not a mere computation of odds on the dice or more complicated variants; it is the acceptance of the lack of certainty in our knowledge and the development of methods for dealing with our ignorance.” ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“When you develop your opinions on the basis of weak evidence, you will have difficulty interpreting subsequent information that contradicts these opinions, even if this new information is obviously more accurate “― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“Those who were unlucky in life in spite of their skills would eventually rise. The lucky fool might have benefited from some luck in life; over the longer run he would slowly converge to the state of a less-lucky idiot. Each one would revert to his long-term properties.” ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“Never ask a man if he is from Sparta: If he were, he would have let you know such an important fact – and if he were not, you could hurt his feelings.” ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“A mistake is not something to be determined after the fact, but in light of the information available until that point” ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“No matter how sophisticated our choices, how good we are at dominating the odds, randomness will have the last word.” ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“There is asymmetry. Those who die do so very early in the game, while those who live go on living very long. Whenever there is asymmetry in outcomes, the average survival has nothing to do with the median survival.” ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“When things go our way we reject the lack of certainty.” ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

(#Ad) Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“The observation of the numerous misfortunes that attend all conditions forbids us to grow insolent upon our present enjoyments, or to admire a man’s happiness that may yet, in course of time, suffer change. For the uncertain future has yet to come, with all variety of future; and to him only to whom the divinity has [guaranteed] continued happiness until the end we may call happy.” ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“If the past, by bringing surprises, did not resemble the past previous to it (what I call the past’s past), then why should our future resemble our current past?” ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“My lesson from Soros is to start every meeting at my boutique by convincing everyone that we are a bunch of idiots who know nothing and are mistake-prone, but happen to be endowed with the rare privilege of knowing it.” ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“There is a simple test to define path dependence of beliefs (economists have a manifestation of it called the endowment effect). Say you own a painting you bought for $20,000, and owing to rosy conditions in the art market, it is now worth $40,000. If you owned no painting, would you still acquire it at the current price? If you would not, then you are said to be married to your position. There is no rational reason to keep a painting you would not buy at its current market rate—only an emotional investment. Many people get married to their ideas all the way to the grave. Beliefs are said to be path dependent if the sequence of ideas is such that the first one dominates.” ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“Bullish or bearish are terms used by people who do not engage in practicing uncertainty, like the television commentators, or those who have no experience in handling risk. Alas, investors and businesses are not paid in probabilities; they are paid in dollars. Accordingly, it is not how likely an event is to happen that matters, it is how much is made when it happens that should be the consideration.” ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“Mathematics is principally a tool to meditate, rather than to compute.” ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“Too much success is the enemy, too much failure is demoralizing.” ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“Mild success can be explainable by skills and labor. Wild success is attributable to variance.” ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“The epiphany I had in my career in randomness came when I understood that I was not intelligent enough, nor strong enough, to even try to fight my emotions.” ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“I will set aside the point that I see no special heroism in accumulating money, particularly if, in addition, the person is foolish enough to not even try to derive any tangible benefit from the wealth (aside from the pleasure of regularly counting the beans).” ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“People do not realize that the media is paid to get your attention. For a journalist, silence rarely surpasses any word.” ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“We favor the visible, the embedded, the personal, the narrated, and the tangible; we scorn the abstract.“ ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“Clearly, an open mind is a necessity when dealing with randomness. Popper believed that any idea of Utopia is necessarily closed owing to the fact that it chokes its own refutations. The simple notion of a good model for society that cannot be left open for falsification is totalitarian. I learned from Popper, in addition to the difference between an open and a closed society, that between an open and a closed mind.” ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“This high-yield market resembles a nap on a railway track.” ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“It certainly takes bravery to remain skeptical; it takes inordinate courage to introspect, to confront oneself, to accept one’s limitations–Scientists are seeing more and more evidence that we are specifically designed by mother nature to fool ourselves.” ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Market

“Many amateurs believe that plants and animals reproduce on a one-way route toward perfection. Translating the idea in social terms, they believe that companies and organizations are, thanks to competition (and the discipline of the quarterly report), irreversibly heading toward betterment. The strongest will survive; the weakest will become extinct. As to investors and traders, they believe that by letting them compete, the best will prosper and the worst will go learn a new craft (like pumping gas or, sometimes, dentistry). Things are not as simple as that. We will ignore the basic misuse of Darwinian ideas in the fact that organizations do not reproduce like living members of nature—Darwinian ideas are about reproductive fitness, not about survival.” ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“we are not made to view things as independent from each other. When viewing two events A and B, it is hard not to assume that A causes B, B causes A, or both cause each other. Our bias is immediately to establish a causal link.” ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Market

“Veteran trader Marty O’Connell calls this the firehouse effect. He had observed that firemen with much downtime who talk to each other for too long come to agree on many things that an outside, impartial observer would find ludicrous (they develop political ideas that are very similar). Psychologists give it a fancier name, but my friend Marty has no training in behavioral sciences.” ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“The formation of our beliefs is fraught with superstitions—even today (I might say, especially today). Just as one day some primitive tribesman scratched his nose, saw rain falling, and developed an elaborate method of scratching his nose to bring on the much-needed rain, we link economic prosperity to some rate cut by the Federal Reserve Board, or the success of a company with the appointment of the new president “at the helm.” ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

(#Ad) Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“Wittgenstein’s ruler: “Unless you have confidence in the ruler’s reliability, if you use a ruler to measure a table you may also be using the table to measure the ruler.”“ ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“Lucky fools do not bear the slightest suspicion that they may be lucky fools – by definition, they do not know that they belong to such a category.“ ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“I always remind myself that what one observes is at best a combination of variance and returns, not just returns.“ ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“I try to make money infrequently, as infrequently as possible simply because I believe that rare events are not fairly valued, and that the rarer the event, the more undervalued it will be in price.“ ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“Unlike a well-defined, precise game like Russian roulette, where the risks are visible to anyone capable of multiplying and dividing by six, one does not observe the barrel of reality.“ ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“[E]conomists are evaluated on how intelligent they sound, not on a scientific measure of their knowledge of reality.“ ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“The more data we have, the more likely we are to drown in it.“ ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“Probability is not about the odds, but about the belief in the existence of an alternative outcome, cause, or motive.“ ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“It does not matter how frequently something succeeds if failure is too costly to bear.“ ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

[E]conomics is a narrative discipline, and explanations are easy to fit retrospectively.“ ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“Trading forces someone to think hard; those who merely work hard generally lose their focus and intellectual energy. In addition, they end up drowning in randomness; work ethics draw people to focus on noise rather than the signal.“ ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“[In] economics… you can disguise charlatanism under the weight of equations and nobody can catch you since there is no such thing as a controlled experiment. Now the spirit of such methods, called scientism by its detractors, continued into the discipline of finance as a few technicians thought their mathematical knowledge could lead them to understand markets. The practice of financial engineering came along with massive doses of pseudoscience.“ ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“There is a saying that bad traders divorce their spouse sooner than abandon their positions. Loyalty to ideas is not a good thing for traders, scientists – or anyone.“ ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“Delivering advice assumes that our cognitive apparatus rather than our emotional machinery exerts some meaningful control over our actions.“ ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

“The observation of the numerous misfortunes that attend all conditions forbids us to grow insolent upon our present enjoyments, or to admire a man’s happiness that may yet, in course of time, suffer change. For the uncertain future has yet to come, with all variety of future; and to him only to whom the divinity has [guaranteed] continued happiness until the end we may call happy.” ― Nassim Nicholas Taleb, quote from Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets

Nassim Nicholas Taleb

Nassim Nicholas Taleb (born 1960) is a Lebanese-American essayist, scholar, mathematical statistician, and former option trader and risk analyst, whose work concerns problems of randomness, probability, and uncertainty. His 2007 book The Black Swan has been described by The Sunday Times as one of the twelve most influential books since World War II.

Taleb is the author of the Incerto, a five volume philosophical essay on uncertainty published between 2001 and 2018 (of which the most known books are The Black Swan and (#Ad Antifragile). He has been a professor at several universities, serving as a Distinguished Professor of Risk Engineering at the New York University Tandon School of Engineering since September 2008. He has been co-editor-in-chief of the academic journal Risk and Decision Analysis since September 2014. He has also been a practitioner of mathematical finance, a hedge fund manager, and a derivatives trader.

Other posts about books by Nassim Taleb

Quotes from “The Bed of Procrustes”: 35 Aphorisms by Nassim Taleb

The Bed of Procrustes: Philosophical and Practical Aphorisms is a philosophy book by Nassim Nicholas Taleb written in the aphoristic style.  The title refers to Procrustes, a figure from Greek mythology who abducted travelers and stretched or chopped…

Top 50 Quotes From The Black Swan by Nassim Nicholas Taleb

“Missing a train is only painful if you run after it! Likewise, not matching the idea of success others expect from you is only painful if that’s what you are seeking.”

80 Top Quotes From Antifragile: Things That Gain From Disorder by Nassim Nicholas Taleb

The antifragile is beyond the resilient or robust. The resilient resists shocks and stays the same; the antifragile gets better and better.