It was this week that I argued extensively with professors and fellow students against the tendency to minimize “the unknown” (say in econometric models) in order for the models & predictions to work. Yesterday evening, after I arrived home, I picked up the copy of NNT’s “The Black Swan” and this paragraph was right there:
“Do not waste your time trying to fight forecasters, stock analysts, economists, and social scientists, except to play pranks on them. They are considerably easy to make fun of, and many get angry quite readily. It is ineffective to moan about unpredictability: people will continue to predict foolishly, especially if they are paid for it, and you cannot put an end to institutionalized frauds. If you ever do have to heed a forecast, keep in mind that its accuracy degrades rapidly with time.
If you hear a “prominent” economist using the word ‘equlibrium’, or ‘normal distribution’, do not argue with him; just ignore him, or try to put a rat down his shirt.
…as the great philosopher of uncertainty Yogi Berra once said, ‘There are some people who, if they don’t already know, you can’t tell ’em.'”
Without Nassim Taleb I would have been ripe for asylum a year or two ago already 🙂