AntiFragile
Nicholas Nassim Taleb
Summary
How to thrive in chaos
Rating: 4/5
Notes
Anti-fragile loves uncertainty and randomness
Anything that has more upside than downside from randomness is anti-fragile
Anti-fragility loves volatility, randomness and time
Black swans dominate society and history
If you see fraud and do not say fraud, you are a fraud
Things can be classified into 3 things: fragile, robust and anti-fragile
Fiscal deficits are a prime source of fragility in social and economic systems
Abundance is harder for humans to handle than scarcity
Post-traumatic growth: after trauma, people improve
Nature like to over-insure itself
Randomness and unpredictability is necessary for a true life
Individual parts of a system need to be fragile so the whole system can be anti-fragile - let zombie companies die
He who has never sinned is less reliable than he who has sinned once. Someone who has made plenty of errors, though never the same more than once, is more reliable than someone who has never made any
Entrepreneurs and risk takers are the source of anti-fragility in the economy
Variability and randomness improves the system
Small in aggregate is more anti-fragile than the large
Fat tails are when unpredictable rare events cause a lot of damage
Delaying crises is not a good idea
Randomness is good for systems; keeps things on their toes
No stability without volatility
Sometimes the best decision is inaction
One should lead a life in which procrastination is good
There’s a difference b/w noise and signal. Noise is what you are supposed to ignore, signal is what you need to heed
Access to data increases intervention which is not necessary, unless emergency
Data is toxic in large quantities
The news makes us believe we live in a more fragile world than exists because of all the noise
You don’t know which cause produces which effect
Social scientists predicting years into the future is zero
Once an event occurs, understand the system that was constructed to allow the event to occur
Curiosity is anti-fragile and is magnified by attempts to satisfy it
Don’t pay attention to credentials. Stay alert to how others treat you
You can make big bucks in predicting that smart people will go bust
Wisdom in decision making is vastly more important than knowledge
An intelligent life is emotionally positioning to eliminate the sting of harm which is done by mentally writing off belongings so losing doesn’t hurt
Wealth is the slave of a wise man and master of the fool
If you have less to lose than to gain, more upside than downside, then you like volatility and are anti-fragile
Barbell strategy: aggressiveness plus paranoia
Do crazy things and stay rational in longer decisions
Your work is anti-fragile if most people dislike it but you have a small group of decent fans
Option = asymmetry + rationality
Humans lack imagination so we need randomness to feed us discoveries
Greed has existed throughout millenia but you can create greed-proof systems
Wealth and economic growth = education for countries, not the other way around
Good speculative bets come to you, you don’t get them watching the news
‘In theory, there is no difference b/w theory and practice. In practice, there is.’ - Yogi Berra
Expert problems (when experts know a lot less than he thinks) bring fragilities. Don’t blindly follow the experts
Practitioners don’t write, they do. Birds fly and those who lecture them are the ones who tell their story
Look for optionality w/ asymmetric payoff, invest in people and have a barbell strategy
Randomness, mess, adventures, uncertainty, self-discovery and near-death episodes all make life worth living
Trial and error is freedom
Much of what other people know isn’t worth knowing
Probability is not as significant as the payoff
For the fragile, shocks bring higher harm as their intensity increases
For the anti-fragile, shocks bring more benefit as their intensity increases
Size hurts you during times of stress: it’s not good to be large in difficult times
Increase in size maps to poor outcomes
Bottlenecks are the mother of all squeezes
The economy is becoming more ‘efficient’, but the errors are increasing in size
Things that like disturbance = anti-fragile, things neutral to them = robust, things that dislike them = fragile
More uncertainty = more role for optionality = more you will outperform
Sometimes the best action is no action. Less is more
There is a winner take all effect where 1% controls 99%
Obvious decisions require no more than a single reason. If you have multiple choices, don’t decide
Understand that the future will still be similar to the past
The past is a better predictor of the future than the present
The longer a technology exists, the longer it can be expected to live
The future is in the past
Study the old books, not the new ones
Humans should not be given explosive toys (bombs, financial derivatives or the tools to create life)
Theories come and go, experience stays. Explanations change bu experience remains constant
The good is mostly in the absence of the bad
We are anti-fragile in randomness to food delivery and consumption
Starving your body periodically is good for you
Cowardice enhanced by technology is all connected
Dignity is worth nothing unless you earn it and are willing to pay a price for it
Predicting without skin in the game is dangerous
You want predictors to have visible scars on their bodies from prediction errors, not distribute these errors to society
Don’t ask anyone for an opinion. Just ask them about their portfolios
Opinions and predictions don’t count, serving is what matters
Have your soul in the game
Treadmill effect: you need to make more and more to stay in the same place
He is free who owns his own opinions
Everything gains or loses from volatility. Fragility is what loses from volatility and uncertainty
***
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How the World Works
Noam Chomsky
Summary
A combination of books Chomsky wrote in the 80s and 90s about America and it's role in the world. Fascinating read and insight into one of the great thinkers of the 21st century
Rating: 5/5
Notes
The US invaded Greece in 1947 and supported a horrendous war which led to 160k Greek deaths. This was the model for Vietnam and allowed American business to gain and thrive
US policies in the 3rd world consistently opposed democracies if they couldn’t be controlled as real democracies believe government should respond to the needs of their own population rather than those of US investors
US-run contra forces in the 3rd world isn’t ordering killing - it’s brutal sadistic torture (Nicaragua, El Salvador, Guatemala)
From the Bolshevik revolution in 1917 till the collapse of the communist governments in eastern europe in the 80s, it was possible to justify every US attack as defense against the Soviets
If you want a global system that’s subordinated to the needs of US investors, you can’t let pieces of it wander off. It’s clearly stated in the documents of record
The US wants ‘stability’ meaning security for the upper classes and large foreign businesses
Solid case for impeaching every American president since World War 2 either outright as war criminals or involved in serious war crimes
El Salvador and Nicaragua were not covered by the US media in the 70s when US-supported brutal torture and murder were taking place
In the early 80s, America’s friends slaughtered 10s of thousands of Guatemalans with countless others tortured and raped
After Vietnam, the major US policy goal has been to maximize repression and suffering of countries demonstrated by their violence - blocked other countries from seeking aid
The US regularly carries out or supports aggression
For most of the 20th century, the US was the dominant economic power and used economic warfare as a weapon ranging from illegal embargoes to enforcement of weak IMF rules with their military becoming pre-eminent
The US tries to avoid negotiations with countries as the US fears it will lose and other countries will be better off
When a state has huge debts, it must divert the population from what’s happening and they do this by inspiring fear of our enemies (Russia in Europe)
The real enemy of the US has always been ‘the poor who seek to plunder the rich’. In America, it’s the opposite and has been for generations
‘The war on drugs’ was a manufactured media blitz by the US leadership to distract the population, increase repression in inner cities and build support for attack on civil liberties
The US government blocks international effort to seek peace (Russia and Ukraine)
Major media are large companies owned and interlinked with even larger conglomerates. The market is the advertisers and the product is audiences
The power in the US lies in the hands of people who determine investment decisions as they determine production, distribution and staff the government. They want a passive, quiescent population
The struggle of freedom is never over and requires active and sustained efforts
One important consequence of globalization is it extends the third world model to industrial nations where the average person has their jobs shipped away while the rich and elite continue to amass massive amounts of wealth
We’ve moved to an international state with the IMF, World Bank, G7 & EU, WEF where the general population doesn’t know what’s happening and it doesn’t know it doesn’t know
If the borrowing the US has done was used for constructive purposes like investment or infrastructure, the US would be better off, but it was used to enrich the rich - for consumption, financial manipulation and speculation which are all harmful
The class warfare of the last few decades has successfully weakened popular organizations leaving people to feel isolated
The US is so deeply in debt to the international financial community because of debt that they have a lock on US policy
Many of the large number of security council resolutions vetoed by the US have to do with Israeli aggression or atrocities
Invaders typically use local collaborators to run things for them by playing upon existing rivalries to get onne group to work for them against another
European wars were wars of extermination. If we were to be honest about history, we would simply describe it as barbarian invasion
There has always been racism but it developed as a leading principle of thought in the context of colonialism.
A standard technique of belief formation goes along with oppression
In the US, you’re not allowed to talk about the class differences, which is the real issue
When the US establishment talks about jobs, it means profits for its corporations
The elite are masters and they follow what Adam Smith said about ‘the vile maxim’ - all for ourselves and nothing for anyone else
People who aren’t owners and investors have nothing much to say in the US
Jefferson warned against banking institutions and corporations and said if they grow, aristocrats would’ve won and the revolution would’ve been lost
The ‘Free market’ is for the poor. We have a dual system - protection for the rich and market discipline for everyone else
There’s been a considerable increase in inequality and has the American society moving towards a third world model, thereby seeing increased crime and signs of social disintegration
A huge area of the media is dedicated to diverting people and making them more stupid and passive
There’s nothing individualistic about corporations who are totalitarian in nature
Free trade agreements result in reduced wages for local employees while predominantly benefiting the rich consumer while also destroying unions
Operation Paper Clip imported large number of known Nazi criminals
The American army’s counter-insurgency literature begins with an analysis of the German experience in Europe written with the co-operation of Naxi officials (instruments of statecraft - book)
US involvement in Chile with the coup in 1973 to reduce social democracy
The threat of a good empire is what the US worried about with reforms on uncontrolled capitalism
The US killed a few million people and destoryed 3 countries during the Vietnam war
A huge amount of business propaganda is to create wants
The answers to solve all these issues is to organize. Being alone you can’t do anything but if you join with other people, you can make changes
Under capitalism, investment is supposed to be as risk free as possible. No competition wants free markets - what they want is power
The government subsidizes corporations’ costs, protects them from market risks and lets them keep the profits
There’s never been much difference between the 2 business parties and the differences are disappearing
The CIA has been involved in drug running for generations (the politics of heroin book)
You need something to frighten people with, to prevent them from paying attention to what’s really happening to them. You have to engender fear and hatred
The first world lives in a highly indoctrinated society
Neoliberalism is nothing more than the imperial formula: free markets for you and plenty of protection for me. The rich would never accept it but they’re happy to impose it on the poor
The UN does mostly what US business wants
‘Politics is the shadow cast on society by big business’ - John Devery
If people dedicate themselves to organizing and activism, we’ll gain access to broader audiences
If you extrapolate to the future, it’s very ugly but the point is it’s not inevitable. It can be changed but we can’t change things till we understand them.
***
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