This is a story about how Ross Perot of EDS (Electronic Data System) rescued two of its two employees from Iran when the revolution happened in 1979 that overthrew Shah’s government. The chaos that ensued was simply incredible and mind boggling.

EDS was involved in setting up and running Iran’s social security system. When the government ran out of money and didn’t pay for their service coupled with the Shah’s departure from power, they decided to retreat back to Dallas, TX. The last two US employee, Paul and Bill, became the hostages of the tenacious antagonist of the story, Dadgar, who jailed them without an accusation/indictment, then managed to chase them to the edge of the border.

Ross Perot tried to rescue them through diplomatic means without success. So he resorted to hiring a squad of people consisted of Bull Simon and other EDS recruits to go into Iran trying to bust them out of the jail. Thanks to the revolution, the mobs and the quick wit of Rashid, an EDS Iranian employee, they escaped the prison and ran into the rescue team. Now the hard time of getting out of Iran in the middle of anarchy where warlords of each village would stop them from reaching the Turkey border.

The readers can glean from this book what it is like to be in a modern revolution, which doesn’t happen often. The lawlessness in a middle of government transition from that of a dictator to that of a religion zealot, combined with the race conflicts made this country a tinder box until this day. It’s amazing how ordinary people live through that era and it’s probably difficult for Americans to comprehend in our stable and law-binding (mostly) society.

I am impressed by the courage of the EDS people to go into the line of fire to rescue a colleague. Employees nowadays would not be least expected to do anything like that.

This book should serve as a warning to the big corporate executives that doing business within a country lacking legal infrastructure is difficult like in this case.

In summary, this is a well researched story that read like a thriller novel. Ross Perot really showed his leadership and pure guts in getting his people out of Iran. I total changed my opinion of him since his run for Presidency back in 1992. The audiobook was quite enjoyable. Ken Follett did a great job in writing this book. Someone should make a movie from this book. Simply mesmerizing!

Nassim Nicholas Taleb has a real winner in this book. This is a consummation of all the thoughts and beliefs, including the book “The Black Swan” he authored. I had a review on that book.. There are numerous concepts that Taleb presented which I will not attempt to summarize; I’ll just cover my key learning/takeaways:

My key takeaways:
1. Being anti-fragile means the more you get beaten the better you get. It’s not just being “robust” or “rigorous” but thrive on the punches being thrown at you. It’s an antidote to the “Black Swan” events, like Mother Nature.
2. The strategy of being anti-fragile as applied to your livelihood or survival is to have a barbell strategy – a steady risk-adverse job with consistent income while pursuing a risk-seeking opportunity on the side. I interpret it as having a dual-path income streams: one that pays the bill and another that has a potentially huge upside. I believe this can be applied to your investment portfolio as well.
3. Via Negativa is an interesting chapter about taking things away to increase your anti-fragility.
4. “Never trust the words of a man who is not free.” Trust a mobster (e.g. Meyer Lansky) but not a civil servant (e.g. Lawrence of Arabia).
5. On ethics, “If you see fraud and do not say fraud, you are a fraud.”
6. Fat Tony’s character is rather interesting – he’s an epitome of the author himself. I like his straightforward and take no-prisoner style.
7. Redundancy is a form of anti-fragility; it gives you the option to be opportunistic. Like having extra oil reserve can be profitable during a oil squeeze.
8. Post-traumatic growth may allow a person live up more than his/her potential after subjecting to traumatic stress – like author’s lifting weight and turning into a “bodyguard.”
9. Some criticism (stresser) can be validating your position – it means you’re generating envy from others. A corporation or government may be fragile when they try to “instill” confidence – unlike a book author can generate publicity by making a news, e.g. beating up an economist.
10. What kills me make others stronger – like plane crashes result in better design for all travelers due to the lessons learned in designing a safer product.
11. Evolution like randomness (like random mutations) to a certain point.
12. Organic products tend to be more reliable than the mechanical.
13. Bottom-up governing (like Switzerland) is more anti-fragile than the top-down bureaucracy due to randomness that strengthen the structure. A taxi-cab driver’s income has more variation than a civil servant or bank worker (or a turkey until before the Thanksgiving) but it’s more anti-fragile.
14. Iatrogenics is doing more harm when trying to be helpful like certain medicines and Fed’s policy during 2007 to iron out the “boom-bust cycle,” and etc. Sometimes, procrastination (like seeing a doctor while healthy or for an elective procedure) may be a good thing.
15. Forecasting or trusting the forecast could be downright harmful to the risk-takers.
16. Having the “optionality” (like going to a “drop-in” party, not obligation, or living in a rent-controlled apartment) allows one to be antifragile. In author’s term, option = asymmetry (benefits more than losing) + rationality (keeping what’s good and ditching the bad). “Life is long gamma” = Life benefits from volatility and variability.
17. Author’s dislike of academia is clear throughout the book. He doesn’t believe it fosters innovation and antifragility except for the administrators and the professors themselves.

Overall, this is a real masterpiece. It’s funny and full of ideas that make you think once you get over Taleb’s sense of humor and his abrasiveness. It’s a must read for everyone for his/her career, investment, and how he/she perceives the world and the systems driving it.

From the Bronx Housing Project to graduating Summa Cum Laude from Princeton, and Yale Law School and then becoming a district attorney, and finally becoming a federal judge and US Supreme Court Justice, Sonia Sotomayor’s journey is nothing short of perseverance, determination, great effort and a little of luck. Though I know the ending of the story (she became a US Supreme Court Justice), the memoir reads like a thriller full of twists and turns like a novel. Hard to imagine the Perry Mason show could have inspired her to reach the ultimate goal of being a Supreme Court Justice.

My lessons learned from reading this book:
1. Being a Type 1 diabetes since 8 years old in a poor family and an alcoholic and yet loving father, Sotomayor beats the odds and turns the disadvantage into a constant reminder of her mortality and works with great sense of urgency toward achieving her goal of becoming a judge. That’s a lesson for most of us endowed with reasonably good health.

2. From her memoir, I learned a little bit of dilemma of Porto Rico and its residents. Is it a US territory with all the benefits of being part of US or a true second-class entity caught in a web of history and politics? Probably both. Would love to visit Porto Rico someday as she painted a picture of a paradise.

3. Having the right mentors and advocates makes a huge difference. She had several good mentors and advocates (like Senator Daniel Moynihan) along the way.

4. She could have gone the way of her childhood pal, Nelson, who ended up being a junkie and died of AIDS at his young age of 30. Two people growing up in almost the same environment came out very differently. The shocking tidbit was when she drove unknowingly her friend to a heroin joint to shoot up while she waited outside as an off-duty district attorney.

5. Like a good judge, Sotomayor is brutally honest about her marriage and her analysis of the situation in retrospect painted a pretty dire picture of the people in the law enforcement sector. They’re so independent and self-preserving – making the relationship difficult with their loved ones. Here’s a good video interview of Sotomayor by Oprah.

6. Behind a successful person is a cast of people cheering her/him on. Sotomayor has loving relationships with her mother, and her brother (“Jr.” as she called him), her grandma, and aunts. She attributes her success to her hard work and to their support.

7. On Affirmative Action, Sotomayor was clearly a successful case out of the Affirmative Acton movement and hence supporting the policy. I wonder without it, where Sotomayor and her brother would end up? With a little of luck (being born in the Affirmative Action era) and a lot of effort on her part, she came a long way to get to where she is now.

8. There is so much Spanish, her native tongue, in this book. It made me want to learn Spanish. Maybe I will some day learn Spanish to reduce the likelihood of an Alzheimer disease as the study shows.

Overall, this is a great memoir for those who enjoy a good real-life underdog-turn-victor story. The depth and the honesty of the author makes the book a real joy to read.

This book shines some light on what make people tick – makes judgments and decisions. Too many concepts were presented and require lots of time relating our current life. I listened to the audiobook twice. The first time was more than a year ago. The second time wasn’t sufficient without reading the book for this review. By the way the Kindle version of the book is selling for just $3. What a bargain for a rich book like this!

My key take-aways:
1. Thinking statistically is really hard and maybe the way to avoid falling trap into our own System 1.
2. Planning fallacy really hit home in my career. I like the remedy of applying past statistics and adjust from there.
3. The use of “premortem” (Part 3) to counter group think is brilliant. I think it’s a great way to think about one’s big personal decision. Ask yourself, “Imagine X years into the future and you have failed. Write a brief history of your failure.” Wow, that’s powerful.
4. WYSIATI (What you see is all there is) lies in the basic theme of System 1. We can only decide based on what we perceive at that moment, mostly from our intuition or System 1.

Overall, it is a very good book if you’re interested in understanding human nature and the conflicts we often found in ourselves.

Here is a quick summary:

There are two systems and two selves in each of us:

Part 1 goes in System 1 and System 2.
System 1: Fast and automatic, with little effort and voluntary control.
System 2: Slow, effortful and attentive – articulates judgments including mental activities and makes choices but if often endorses or rationalizes ideas and feelings that were generated by System 1.
Priming effect is due to System 1. Whatever is easier like what’s easier to pronounce, or rhyme due to cognitive ease. Explaining away the coincidence like the “Black Swan” event, halo effect, and jumping into conclusion are what System 1 is good at, assisted by System 2. System 2 plays the “apologist” role for the emotions of System 1 then a critic of those emotions – an endorser rather than an enforcer.

Part 2 talks about the heuristics vs. thinking statistically, which system 1 lacks. Small samples do to lend to statistically meaningful conclusions – fooled by small samples. Also we’re subject to anchoring for something we have no reference of, like “Is the tallest redwood tree taller than 1200 ft? What’s your best guess?” The availability bias makes us think things are more frequent if we can recall most instances like consecutive plane crashes. “Availability Cascade” is attributed to the limitation of our mind to deal with small risks: we either ignore them altogether or give them far too much weight due to viral news spreading. The sins of representativeness: excessive willingness to predict the occurrence of unlikely (low base-rate) events. Both System 1 and 2 may be guilty of incorrect intuitive judgement. System 1 suggested the incorrect intuition and System 2 endorsed it and expressed it as a judgment – due to ignorance or laziness. 2nd sin: insensitivity to the quality of evidence. Leverage Bayesian Statistics and anchor your judgement of the probability of an outcome on a plausible base rate and question the diagnosticity of your evidence. Conjunction fallacy as in the “Linda” example highlights the laziness of System 2 that breaks the statistical logic – less is more – a more plausible story that appeals to System 1. People often don’t learn things from statistics (especially the base rate) until they can derive causal interpretation from them. This is where Bayesian Statistic is important. Also grasping the concept of regression to the mean is difficult because of the insistent demand for causal interpretations by System 1.

Part 3 describes the limitation of our mind and over confidence in what we believe we know. Hindsight bias leads observers to assess the quality of a decision not by whether the process was sound but by whether its outcome was good or bad. Outcome bias is when the outcome is are bad, the agents get blamed for not seeing the handwriting. Illusion of validity is acting like as if each of our specific predictions was valid, for example, author’s predicting the solder’s future performance and the fund manager in finance. Experts are often inferior to algorithms because experts try to be clever, consider complex combinations of features in making their prediction and humans are inconsistent in making summary judgments of complex information. Only trust those with two basic conditions for acquiring a skill: an environment that’s sufficiently regular to be predictable, and an opportunity to learn these regularities through prolonged practices and feedback. Planning fallacy describes plans and forecasts that are unrealistically close to the best-case scenarios, and could be improved by consulting the statistics of similar cases. We tend to exaggerate our forecast ability which fosters optimistic overconfidence. Optimistic bias is what drives the entrepreneurs who drive our economy. Use of “Premortem” procedure – when a group almost come to an important decision but has not formally committed itself, gather a group of people knowledgeable about the decision and ask “Imagine that we are a year into the future. We implemented the plan as it now exists. The outcome was a disaster. Please take 5 to 10 minutes to write a brief history of that disaster.” The premortem legitimizes doubts – not suppressing healthy amount of doubts and paranoia.

Part 4 challenges the rationality assumption in standard economics. The author debunked the Bernoulli’s utility theory by arguing that it doesn’t take reference point into account. Starting from $4M to $2M vs. from $1M to $2M would have different utility curves. A person become risk seeking when all his options are bad – the basis for author’s Prospect Theory. Endowment effect explains why you tend to value more of what you own and less of what others own because of different reference point and loss looms larger than gain – unlike a trader. Possibility effect places a heavy weight between 0% and 5% probability and certainty effect places a heavy weight between 95% and 100%. In the author’s Fourfold pattern, people tend to be risk adverse when there is high probability of gain and low probability of loss (insurance), but risk seeking when there is high probability of loss and low probability of gain (lottery). People tend to over-estimate the probability of rare events and overweight their probability. The emotion of regret is more felt to an outcome that is produced by action than to the same outcome when it’s produced by inaction. By anticipating the regret before your decision, you may minimize the regret.

Part 5 describes the two selves: the experiencing self and the remembering self.
When it comes to pain, the following were observed: Peak-end rule – worst pain and the pain at the end dominates. Duration Neglect: the duration of the procedure had no effect whatsoever on the ratings of the total pain. Is the experience or the memory of the experience that matters? We’re often confused by it – cognitive illusion. Pain is preferred to be short and pleasure long but our memory, a function of System 1, has evolved to the remember the peak (pain or pleasure) and at its end and neglects its duration. We have an experiencing self and remembering self, which we seem to care more as demonstrated in the “amnesia vacation” example.

Richard Dawkins is a well known author and atheist. I first read his “God Delusion” book back in spring, 2007. See my review here. I was since impressed by his passion for evolution and debunking of creationism. In his young tender age of 71 now, Richard Dawkins decided to write a memoir about himself and described how he became who he is. There aren’t that many great scientists would venture to write a memoir for himself but Richard Dawkins are no ordinary scientist, his arguments for evolution are all very compelling. I am sure he has pushed many people on the fence over to the side of evolution, myself included.

In this book, he went through his childhood and upbringing and growing up in Africa and various countries around the world. This might have made him a rebel and yet very adaptable to strange places include the one full of right-wing extremists. His move to Berkeley, California, in the 1960’s might have reinforced his rebellion mentality. His eventual tenure at Oxford legitimized his place in science and specifically atheism.

A few takeaways from the book:

Dawkins, as a zoologist, designed lots experiments to understand the animal behavior to determine the natural and nurtured behaviors like chicken’s response to light shone from the top vs from the floor.

A penchant for computer programming: Dawkins was so adept in computer programming, way ahead of his time, such that he designed several programming languages to suit his needs.

We stand on the shoulders of many giants so we can look farther. Dawkins attributes his success to Charles Darwin and a few college advisers and professors.

I need to read the Selfish Gene book. He described many of the details how he arrived at the Selfish Gene book he wrote more than 30 years ago. In essence, the gene or a well evolved gene would propagate in the selfish manner to extend its immortality. Otherwise, they would go extinct. We humans are here because of our human selfish gene.

As a true evolutionist, Dawkins questioned whether he could become who he became without having to lived and evolved through his life environment. I cannot help think that at this moment the world is still evolving and my actions and thoughts may have an impact to the process. And in many ways out of infinite possible ways we all do.

There are so many videos I recommend about Dr. Richard Dawkins’ view:
Militant Atheism.
Why the universe seems so strange
Best of Richard Dawkins Arguments

This book gives me a glimpse of the making of a great scientist. It takes courage, tenacity, and constant questions about the status quo and an appetite for wonder.

The housing boom and bust of the last decade was something that I wanted to put behind me. The craziness of the housing boom at the time was unbelievable; anyone could walk in and bid up the house price and walked away with a brand-new mansion without a down payment or employment record. I changed house during that time and was both a victim and beneficiary of that cycle (I sold my old home and bought a home and an overpriced rental property). When this book was introduced to me, I didn’t want to read it or listen to the audiobook until I ran out of audiobooks to listen to. But I thought it would be good to know the diagnosed root causes of the previous housing boom and bust as it appears another housing boom cycle has started in Northern California due to the recent hot high-tech job market in our area.

I did learn something from the book:

I always thought the housing boom was a result of bad banking practice, bad credit rating of the then popular CDS (credit default swap) – a financial derivative. Little did I know that the politicians, in the name of affordable housing “urged” by the Fannie Mae/Freddie Mae lobbyists, contributed to the housing boom and the subsequent bust by forcing banks to loan to high-risk and often minority house buyers. Banks would have survived the crisis by making sound loans without government’s coercive measure to loan to the high-risk house buyers who ended up default on their sub-prime mortgages.

In the name of “slow” development, the communities tend to create a real estate market of increasingly expensive housings. In comparison, cities like Houston, TX, doesn’t have the same issue thanks to the lack of housing restrictions. So it appears the controlled development leads to higher housing prices.

In the last chapter, the author touched on the historical perspectives: it may not be the New Deal that got U.S. out of the depression, rather it’s the World War II that drafted many people out of job market. More mangling by the government may have contributed to more economic shocks. A good example is Canada, which didn’t interfere in the market and escaped from the financial disaster that the U.S. experienced. The author didn’t paint a good picture that history would not repeat itself in the U.S.

This is a good book if you wanted to know about the housing boom and bust cycles and the root causes of the financial melt down of the last decade but be aware of the author’s “right” bias against government regulations and “legal” corruptions.