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January 1, 2008

SHELF LIFE

Forward editors review the latest books on business, economics and trade.

The Black Swan: The Impact of the Highly Improbable

 

by Nassim Nicholas Taleb
Random House, 2007
U.S. $26.95, Canada $34.95

How do you best review a serious book—well-written, entertaining, informative, clear, at times compellingly fresh—authored by a genuinely unusual personality who, in all humility, considers himself something of a genius?

Such is the case with The Black Swan. Taleb, who holds a Ph.D. in financial mathematics from the University of Paris, previously directed hedge fund Empirica Capital LLC, but quit after 18 years because he was “bored with it.” This deprecating view of what for most traders would be a successful career in the fast lane is part of Taleb’s charm and allure. He has been in businesses that most of us would not attempt. He claims he has done so mostly so he would have ample time to study subjects that really matter. One such is the impact of unexpected events—dubbed “Black Swans” after the surprise discovery of such non-white birds in Australia—on life.

Taleb’s central point is that wildly unexpected events have the most significance in our lives, yet we fail to recognize such events not only can happen, but will happen. A portion of the book examines how the ways we think and our propensity to organize data limit our ability to understand how “outliers”—those people and situations that fall well beyond the norm—can become Black Swans. Our nature limits analysis to what we know and understand, and causes us to reject those things that are strange or new. This creates a world view where change is incremental and measured, and past performance is accepted as a likely foreshadowing of future outcomes.

Reality, Taleb suggests, is just the opposite. Those who seek to be successful over the longer term, he suggests, should seek to understand the unpredictable first, and the known and easily knowable later.

Taleb has an entertaining style, pierced with personal anecdotes from his childhood in Lebanon and his various stops around the world. Even the more technical aspects of the book—and there are a few—are enjoyable. “It is more difficult to be a loser in a game you set up yourself,” Taleb writes. “…this means that you are exposed to the improbable only if you let it control you. You always control what you do; so make this your end.”

Good advice from a very interesting individual.

 

 

 

by Bruce Tulgan
Collins, 2007
U.S. $23.95, Canada $29.95

It’s Okay to Be the Boss: The Step-by-Step Guide to Becoming the Manager Your Employees Need

Managers looking to empower employees with a hands-off approach, author Tulgan says, have created an undermanagement epidemic in industries across the board. Many fail to monitor and measure performance, correct failure and reward success. It’s Okay to Be the Boss teaches managers how to define goals, delegate work, follow up and offer feedback without interfering with the work and productivity of employees.

 

 

 

by Roberto Mangabeira Unger
Princeton University Press, 2007
U.S. and Canada $29.95

Free Trade Reimagined: The World Division of Labor and the Method of Economics

Author Unger criticizes the notion of free trade while not blindly defending protectionism. He challenges the current defining principles of free trade: the maximization of free trade as a goal; enforced propagation of a particular form of the market economy; a focus on the movement of capital, goods and services; and wide disparities in labor rights. Free Trade Reimagined identifies specific necessary reform measures in order for free trade and globalization to universally benefit all economies and countries.