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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