Interesting Links

  •  Peter Cotton reveals the new clothes of finance’s popular emperors. The most hilarious sarcasm I’ve ever read. And the most powerful counterattack against the dumbing down of finance by self-proclaimed experts. A great source of inspiration for Quixotic Finance.


  •  Eric Falkenstein lays out many amusing contradictions in Taleb’s writings, like Taleb denouncing the arrogance of traders and overconfidence of academics, while himself wallowing in puffed-up self-glorification. Falkenstein persuasively explains why fractal distributions have little use in finance, debunks some popular myths about VaR and discusses the empirical evidence for, or rather against, Taleb’s single meager attempt to get something useful out of the Black Swan concept; namely his barbell strategy for investing. Using Martin Gardner’s five criteria to label someone a crank, his conclusion is, unsurprisingly… No I’m not going to spoil everything, just read the article.





  •  The full paper (76 pp) cited by FT Alphaville in the previous link. Not for the faint of heart, but with a little bit more effort you get a much more realistic idea of how quants think and work. Donald MacKenzie, a sociologist with a better understanding of quantitative finance than most impostors touted in the media, combines rigor, depth, and a scrupulous fact-checking approach that makes him a lone voice of rationality in a debate poisoned by mud-slinging and demagoguery.




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