Lecturing Birds on Flying: Can Mathematical Theories Destroy the Financial Markets?
Pablo Triana (Author), Nassim Nicholas Taleb (Foreword)

For the past few decades, the financial world has often displayed an unreasonable
willingness to believe that "the model is right, the market is wrong," in spite of
the fact that these theoretical machinations were largely responsible for the stock
market crash of 1987, the LTCM crisis of 1998, the credit crisis of 2008, and many
other blow-ups, large and small. Why have both financial insiders (traders, risk
managers, executives) and outsiders (academics, journalists, regulators, the public)
consistently demonstrated a willingness to treat quantifications as gospel' Nassim
Taleb first addressed the conflicts between theoretical and real finance in his
technical treatise on options, Dynamic Hedging.

Now, in Lecturing Birds on Flying, Pablo Triana offers a powerful indictment on
the trustworthiness of financial theory, explaining-in jargon-free plain English-
how malfunctions in these quantitative machines have wreaked havoc in our real
world. Triana first analyzes the fundamental question of whether financial markets
can in principle really be solved mathematically. He shows that the markets indeed
cannot be tamed with equations, presenting a long and powerful list of obstacles
to prove his point: maverick unlawful human actions rule the markets, unexpected
and unimaginable events shape the markets, and historical data is not necessarily
a trustworthy guide to the future of the markets. In the end, Lecturing Birds on
Flying calls for the radical substitution of good old-fashioned common sense in
place of mathematical decision-making and the restoration to financial power of
those who are completely unchained to the iron ball of classroom-obtained
qualifications.

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