Fooled by Randomness

The Hidden Role of Chance in Life and in the Markets

Nassim Nicholas Taleb | 4.18 | 48,585 ratings and reviews

Recommended by Malcolm Gladwell, Ev Williams, Ryan Holiday, and 9 others. See all reviews

Ranked #3 in Business Statistics, Ranked #4 in Macroeconomics — see more rankings.

Fooled by Randomness is a standalone book in Nassim Nicholas Taleb’s landmark Incerto series, an investigation of opacity, luck, uncertainty, probability, human error, risk, and decision-making in a world we don’t understand. The other books in the series are The Black Swan, Antifragile, and The Bed of Procrustes.

Now in a striking new hardcover edition, Fooled by Randomness is the word-of-mouth sensation that will change the way you think about business and the world. Nassim Nicholas Taleb–veteran trader, renowned risk expert, polymathic scholar, erudite raconteur, and New York Times bestselling author of The Black Swan–has written a modern classic that turns on its head what we believe about luck and skill.

This book is about luck–or more precisely, about how we perceive and deal with luck in life and business. Set against the backdrop of the most conspicuous forum in which luck is mistaken for skill–the world of trading–Fooled by Randomness provides captivating insight into one of the least understood factors in all our lives. Writing in an entertaining narrative style, the author tackles major intellectual issues related to the underestimation of the influence of happenstance on our lives.

The book is populated with an array of characters, some of whom have grasped, in their own way, the significance of chance: the baseball legend Yogi Berra; the philosopher of knowledge Karl Popper; the ancient world’s wisest man, Solon; the modern financier George Soros; and the Greek voyager Odysseus. We also meet the fictional Nero, who seems to understand the role of randomness in his professional life but falls victim to his own superstitious foolishness.

However, the most recognizable character of all remains unnamed–the lucky fool who happens to be in the right place at the right time–he embodies the “survival of the least fit.” Such individuals attract devoted followers who believe in their guru’s insights and methods. But no one can replicate what is obtained by chance.

Are we capable of distinguishing the fortunate charlatan from the genuine visionary? Must we always try to uncover nonexistent messages in random events? It may be impossible to guard ourselves against the vagaries of the goddess Fortuna, but after reading Fooled by Randomness we can be a little better prepared.

PRAISE FOR FOOLED BY RANDOMNESS :

Named by Fortune One of the Smartest Books of All Time

A Financial Times Best Business Book of the Year

“[Fooled by Randomness] is to conventional Wall Street wisdom approximately what Martin Luther’s ninety-five theses were to the Catholic Church.”
–Malcolm Gladwell, author of Blink

“The book that rolled down Wall Street like a hand grenade.”
–Maggie Mahar, author of Bull! A History of the Boom, 1982—1999

“Fascinating . . . Taleb will grab you.”
–Peter L. Bernstein, author of Capital Ideas Evolving

“Recalls the best of scientist/essayists like Richard Dawkins . . . and Stephen Jay Gould.”
–Michael Schrage, author of Serious Play: How the World’s Best Companies Simulate to Innovate

“We need a book like this. . . . Fun to read, refreshingly independent-minded.”
–Robert J. Shiller, author of Irrational Exuberance

“Powerful . . . loaded with crackling little insights [and] extreme brilliance.”
–National Review less

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Reviews and Recommendations

We've comprehensively compiled reviews of Fooled by Randomness from the world's leading experts.

Malcolm Gladwell Writer & JournalistRecommends this book

Ev Williams Co-Founder/Twitter, CEO/MediumRecommends this book

James Altucher Founder/StockPickrAnd throw in “The Black Swan” and “Fooled by Randomness”. “Fragile” means if you hit something might break. “Resilient” means if you hit something, it will stay the same. On my podcast Nassim discusses “Antifragility” – building a system, even on that works for you on a personal level, where you if you harm your self in some way it becomes stronger. That podcast changed my life He discusses Antifragility throughout history, up to our current economic situation, and even in our personal situations. (Source)

Ryan Holiday AuthorRecommends this book

Darvin Kurniawan "The Black Swan" by Nassim Nicholas Taleb (and basically the others in the series like "Fooled by Randomness" and "Antifragile") are also my favourites. It explained things that I sort of felt existed but unable to articulate. These books explained it well, about the role of chance/probability and randomness, in our lives. (Source)

Ola Olusoga Like Charlie Munger once said: “I’ve long believed that a certain system - which almost any intelligent person can learn - works way better than the systems most people use [to understand the world]. What you need is a latticework of mental models in your head. And, with that system, things gradually fit together in a way that enhances cognition. Just as multiple factors shape every system, multiple mental models from a variety of disciplines are necessary to understand that system". You can read this book to start building a "latticework of mental models in your head". (Source)

Art De Vany I used [this book] is a class I taught on the economics of uncertainty. (Source)

Anant Jain The five-book series, "Incerto", by Nassim Nicholas Taleb has had a profound impact on how I think about the world. There’s some overlap across the books — but you'll likely find the repetition helpful in retaining the content better. (Source)

Howard Marks Really about how much randomness there is in our world. (Source)

Rankings by Category

Fooled by Randomness is ranked in the following categories:

#26 in Bank
#23 in Banking
#59 in Behavior
#23 in Behavioral Economics
#49 in Business Economics
#83 in Business Motivation
#85 in Business Strategy
#28 in Cognitive Psychology
#28 in Critical Thinking
#45 in Data Science
#22 in Decision Making
#29 in Economics
#23 in Finance
#36 in Financial Management
#71 in Fire
#6 in Free Will
#32 in Game Theory
#92 in Information
#22 in Investment
#27 in Logic
#26 in Logical Reasoning
#64 in Math
#83 in Money
#80 in Personal Finance
#5 in Probability
#40 in Problem Solving
#30 in Reasoning
#8 in Risk Management
#82 in Social Psychology
#98 in Social Sciences
#10 in Statistics
#10 in Stock Market Investing
#19 in Stock Trading
#25 in Stocks
#44 in Thinking
#26 in Trade
#99 in Wealth

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