'Black Swan' author Taleb has a piece of advice for Gautam Adani

Nassim Taleb

Nassim Nicholas Taleb, the renowned author of The Black Swan and Antifragile, has a piece of advice for Gautam Adani after he released a video statement explaining the rationale behind withdrawing the fully subscribed follow-on public offer (FPO) of his group flagship Adani Enterprises.

In the video message, Adani, who perhaps is facing the biggest challenge to his business empire, said pushing ahead with the issue would have been not "morally correct" after a massive erosion in the stock price.

"Advice to Adani (& others): It (sic) everything is OK, don't produce a video saying "everything is OK"," Taleb tweeted on February 3.

Advice to Adani (& others):
It everything is OK, don't produce a video saying "everything is OK".

— Nassim Nicholas Taleb (@nntaleb) February 2, 2023

The tweet comes as the selloff in the shares of  Adani Group companies, spanning ports, airports and green energy, continues after US-based short seller Hindenburg Research made accusations of accounting fraud and stock market manipulation in a recent report that also flagged debt worries.

The group has denied the charges but that has done little to stop the hemorrhaging.  On February 3, the group’s 10 stocks tanked in the morning trade, with $120 billion, or more than half of their combined value, wiped out in the aftermath of the Hindenburg Research report.

Adani Enterprises was down 35 percent, taking the decline to 66 percent in seven trading sessions.

Taleb, who is also an adviser to hedge fund Universa Investments, was a pioneer of tail risk hedging, which is intended to mitigate investors' exposure to extreme market moves.

He has written several bestselling books on probability, nature of complexity, randomness, and how extreme events shape the scheme of things in the world.

His 2007 book, The Black Swan, was voted as one of the 12 most influential books since World War II.