The single most useful book I ever read

My measure by which I find a book useful is the likelihood that I am going to read it again and again and again.

For that to happen a book has of course to be well written but has to also hold lots of nuggets of information and insight that I use again and again. Against this criteria the most useful book I have ever read is “Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets” by Nassim Nicholas Taleb. Its by far the best written of all of Taleb’s books and easily the most useful.

It taught me that survivorship bias is one of the most damaging traits, not just in business and markets but in everyday life. Its very easy to become envious of what your neighbour, friends or colleagues are doing with their lives (even more so with modern social media), such as buying a bigger house, a nicer car, more expensive holidays.

But what you don't see is at what cost that is being achieved. From a financial point of view you don’t know how much risk that person is taking on (more unsecured debt and / or working in an occupation where chance plays a big role). As such its very difficult to know whether that person is genuinely smart or just a lucky idiot.

As Taleb says, “Repetitiveness is key for the revelation of skills.” Its easy to spot a talented chef, but not so easy to spot a talented…