According to the GQ profile he has a new book in the works that for now is called Tinkering, as someone who enjoys his writing that is good to know.
Working backwards the WSJ article about the new fund is interesting in that taking steps to protect against hyperinflation is easily done by do-it-yourselfers. I'm not saying whatever strategy Taleb's fund ends up doing is easily replicated but anyone can buy TIPS, gold, other commodities and equity markets that stand poised to benefit from some sort of hideous inflation event in the US were it to happen.
Tavakoli questions the reporting by GQ of Taleb's results reported as $20 billion in profits whereas Clusterstock seems to take a skeptical view Taleb himself.
My take on Taleb is as more of a big picture guy (not a unique opinion by any means) and so his investment results are not very important to me. As mentioned in a previous post and brought up in the WSJ article, a fund Taleb was involved with previously was closed in 2004 for poor results. This is inconsequential because the purpose of the fund was to capitalize on extreme outcomes--blackswan events if you will. After the tech meltdown we entered a period of time where there was very little volatility so a fund that relies on volatility at a time when there is none, or very little, is unlikely to do well.
WRT to his starting a fund along these lines I would be most interested in the thought process that leads him to believe the US is in for hyperinflation. Yeah, we all probably have a good idea of why he thinks that but specifically is there anything he sees that maybe isn't being talked about by a lot of people. Maybe not, but that is what I would want to know about.
The GQ article included a little nugget from Taleb about not giving advice. He says it is "anathema to me--I can only tell you what not to do." He feels advice givers are charlatans. Needless to say I don't entirely agree with that one but there are certainly plenty of incompetent advice givers.
Zooming out a little bit Taleb is a thinker, he provokes thought. I believe I can learn from him in agreeing with some points, disagreeing with some and not fully understanding some others. Other people can do the same and you either see that value or not which is of course fine.
From different information sources we get different utility. Some folks provide stock picks, others economic analysis and so on and Taleb is more of a this is how to think type of guy. Asking an economist for stock picks is probably futile just as asking Taleb how to invest for college for a newborn is a waste of time.
On an unrelated note the Portland Sea Dogs are the AA affiliate of the Boston Red Sox. They play their home games at Hadlock Field which has the pictured replica of the Green Monster from Fenway Park called the Maine Monster.I caught a couple of innings of the Sea Dogs game against the Binghamton Mets last night on NESN. Maybe I'm the last baseball fan to know but I'd never seen this before.
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I tend to wonder if Taleb's recent fame is because of the downturn (GQ!!??). I see many more folks seeking education than hot stock picks. This is one of those 'good things' that have come from the recession. Taleb is a lot like Jimmy Rogers to me, it's just so extreme that you can't take the advice lock stock, but it does provide a very interesting perspective.
I'd be interested to hear if anyone here has tried Taleb's allocation even if in a mini-portfolio. I've considered trying it, but only in a limited capacity.
This is the first I've seen of the replica green monster. But I don't watch the Ocho like you do.
I wonder if there's an actual Citgo station there or if it's part of the replica look.
"that's right Cotton."
The inflation, deflation debate is very interesting and key to understanding the future. I tend to agree with inflation - eventually. But not anytime soon.
Roger, black swan trading is not Taleb, right? He's not listed under the 'management team' and the business address is someone's house.
Roger - I know you have felt that the bond market is "broken" somewhere since conventional logic still hasn't corrected non-taxable/taxable spreads yet. Are you still waiting for a correction? What are you doing with existing bonds as they come due or do you just use funds?
Inflation? What is it?
I wish I could find an easy way to look at the financial America of the Lyndon Johnson period. My dad didn't read the WSJ. What I do remember really well is how easy it was to get a job. Then Nixon came along, and he was going to stop inflation, that was his gimmick to get elected. Before Nixon, I'd never heard of inflation.
By the time Nixon had been president for a year, you couldn't get a job delivering pizza's. Nixon's wage/price freeze, which failed, started a round of inflation that culminated with Paul Volker raising the prime rate up over 20%.
Inflation as defined by Ricardo (the Spanish economist who first described inflation) says that as the population increases, the price of land increases. I'm not sure about other places, but there sure are a lot of empty houses for sale around here. They weren't for sale or empty a year ago. Nice homes too, nice middle class neighborhood. Many with price reduced from initial listing price.
Because of my fathers business, I do remember the price of a new home, comparable with the homes in the neighborhood here. In 1962, a nice, brand new, 3 bedroom home, build by George Airey, in Ann Arbor, Michigan was around $30,000. A comparable home here (different Big 10 town) is for sale for $200,000 - $240,000, and I can only guess how much higher back home.
I don't see any end to the downward pressure on home prices.
Taleb is beginning to look a little similar to a winner of one of those TV reality shows -- making hay for himself while the sun shines.
BillM
Anon 8:18, I'd love to agree with your last statement about pressure on home prices, but the market seems to be saying otherwise.
U.S. Home Resales Surge the Most Since 2001Or do you think that maybe this is a fluke rather than the bottom?
My take would be "you're going up incrementally from zero."
Notice that the 2 decent gains are in the 2 of 4 areas that had the least run-up in home prices and "Still, the gains in pending sales have been larger than actual home resales in recent months, perhaps reflecting the influence of foreclosures."
My poll of the house across the street says we're still having problems in the housing market! Heh.
roger,
you place such short term importance on the S&P crossing its 200 day SMA....no mention of it now?
Month to month real estate numbers are seasonal and extremely noisy and quarter to quarter are only only slightly better; only year over year numbers are reliable trend indicators.
As it stands pending sales are only up for lower priced pre-existing homes w/ higher priced homes continuing to lose value and foreclosure rate showing no sign of slow-down: Alt-A is the new sub-prime.
The only inflationary scenario that makes sense in the short- to intermediate-term would involve a currency crisis; it is otherwise not in the cards.
Roger,
I hate this market 85% invested for a while lots of foreign some MVV. I do not know when this rally will end (1 month? 12 month?)
But you now have to start re equitizing according to your rules. Good rules, considering there are no divine fantastic rules, but do you go lite or normal add now? Please do not take this as a criticism as I hate my choices as well, I am just wondering how you view your bad choices?
Roger- I thought you would enjoy this article on farmland...
http://www.economist.com/world/international/displaystory.cfm?story_id=13692889
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