FOOLED BY RANDOMNESS

Author: Nassim Nicholas Taleb
Year: 2007 (2004)
Publisher: Penguin Books
Language: English

I am not a particularly intelligent man. I know what I need to know and I understand what others have told me I need to understand. I totter around the world like most other people oblivious of the size of the universe, relying to a large degree on knowledge generated by others and wisdom accumulated by generations before me. I am, by all accounts, a banker belonging to the most commonplace persuasion.

And yet, the mediocre mind that I possess, I still cannot find a single original thought in Nassim Nicholas Taleb’s “Fooled by Randomness”, hailed by Fortune Magazine as ‘one of the smartest books of all time’.  

“Fooled by Randomness” has achieved near-canonical status in the literature of risk, uncertainty, and human irrationality. Its reputation rests on its supposedly radical thesis: that we routinely mistake luck for skill, underestimate randomness, and build narratives to explain what is often just noise. Yet reading the book critically, one is struck less by its originality and more by Taleb’s flair for repackaging ideas that, while vital, are hardly new.

At its core, “Fooled by Randomness” argues that human beings are cognitively ill-equipped to understand probabilistic reality. Taleb illustrates how traders, investors, CEOs, and even scientists often credit themselves for success that is better attributed to statistical variance. This insight, though forcefully delivered, echoes long-established ideas from behavioural economics, cognitive psychology, and philosophy from Hume’s scepticism about causation to Popper’s critique of historical determinism. Taleb’s contribution thus remains shrouded in mystery.

Ironically, what he presents as revelatory is something many thoughtful readers might consider common sense: unpredictable events happen (or “shit happens” might better capture it), luck plays a large role in outcomes, and our confidence in our own stories far exceeds the evidence of their actuality. His central admonition, “expect the unexpected”, is ancient in spirit. So is “alea iacta est”. Or “pride goeth before destruction”. The list goes on and on.  

One is reminded of Stoic counsel, medieval warnings against hubris, and the probabilistic humility embedded in scientific method or the biblical call to modesty, piety and reflection. Taleb’s philosophical posture is a modern reframing of old wisdom, delivered with charismatic frustration at humanity’s refusal to internalise it.

But this lack of originality does not render the book irrelevant. If anything, it underscores Taleb’s larger, and surprisingly damning, point: even the simplest probabilistic truths must be endlessly restated because we as humans persistently fail to live by them. We prefer neat explanations over messy randomness, confident predictions over uncertainty, and flattering narratives over the humbling truth of chance.

A particularly sharp example is his takedown of the caste of Risk Managers in financial institutions. Taleb argues that Risk Managers act primarily to protect themselves rather than their firms. From my own professional experience, this rings painfully true: risk frameworks often become bureaucratic armour rather than genuine safeguards, designed more to deflect blame than to confront uncertainty.

The very fact that “Fooled by Randomness” feels obvious is part of its evidence: our institutions and personal decisions alike routinely disregard what should be common sense.

This is where the book earns its value. Taleb’s observations, though not groundbreaking, are delivered with a piercing clarity that exposes the gap between what we should know and how we actually behave. He forces the reader to confront not merely intellectual errors but the emotional and cultural forces that encourage them. If we continuously act as though the world is more predictable than it is, then perhaps even cliché warnings about uncertainty need to be articulated, loudly and repeatedly.

In the end, “Fooled by Randomness” is less an original treatise than a necessary one. Its power lies not in novelty but in its unrelenting insistence that our blindness to randomness is self-inflicted and catastrophically persistent. Taleb may not tell us anything fundamentally new, but he tells us what we perpetually fail to remember. Rather like a demented patient is repeatedly fascinated by the same discovery, to our oblivious selves, this book endures as a periodical reminder of something our primitive minds simply cannot contain for any meaningful period of time.