Alex Preston's website

Alex Preston / bookshelf

Antifragile: Things That Gain from Disorder by Nassim Nicholas Taleb

we can almost always detect antifragility (and fragility) using a simple test of asymmetry: anything that has more upside than downside from random events (or certain shocks) is antifragile; the reverse is fragile.
Students pay to write essays on topics for which they have to derive knowledge from a library as a self-enhancement exercise; a professional who is compensated to write and is taken seriously by others should use a more potent filter. Only distilled ideas, ones that sit in us for a long time, are acceptable—and those that come from reality.
If you see fraud and do not say fraud, you are a fraud.
So a certain system of tinkering and trial and error would have the attributes of antifragility. If you want to become antifragile, put yourself in the situation “loves mistakes”—to the right of “hates mistakes”—by making these numerous and small in harm. We will call this process and approach the “barbell” strategy.
Removing medication, or some other unnatural stressor—say, gluten, fructose, tranquilizers, nail polish, or some such substance—by trial and error is more robust than adding medication, with unknown side effects, unknown in spite of the statements about “evidence” and shmevidence.
This mechanism of overcompensation hides in the most unlikely places. If tired after an intercontinental flight, go to the gym for some exertion instead of resting. Also, it is a well-known trick that if you need something urgently done, give the task to the busiest (or second busiest) person in the office. Most humans manage to squander their free time, as free time makes them dysfunctional, lazy, and unmotivated—the busier they get, the more active they are at other tasks. Overcompensation, here aga in.
Antifragile Responses as Redundancy
Redundancy is ambiguous because it seems like a waste if nothing unusual happens. Except that something unusual happens—usually.
Further, redundancy is not necessarily wussy; it can be extremely aggressive. For instance, if you have extra inventory of, say, fertilizers in the warehouse, just to be safe, and there happens to be a shortage because of disruptions in China, you can sell the excess inventory at a huge premium. Or if you have extra oil reserves, you may sell them at a large profit during a squeeze.
This method consisted of short episodes in the gym in which one focused solely on improving one’s past maximum in a single lift, the heaviest weight one could haul, sort of the high-water mark. The workout was limited to trying to exceed that mark once or twice, rather than spending time on un-entertaining time-consuming repetitions.
Please Ban My Book: The Antifragility of Information
Information is antifragile; it feeds more on attempts to harm it than it does on efforts to promote it. For instance, many wreck their reputations merely by trying to defend it.
Get Another Job
When you don’t have debt you don’t care about your reputation in economics circles—and somehow it is only when you don’t care about your reputation that you tend to have a good one. Just as in matters of seduction, people lend the most to those who need them the least.
The Complex
with complex systems, interdependencies are severe. You need to think in terms of ecology: if you remove a specific animal you disrupt a food chain: its predators will starve and its prey will grow unchecked, causing complications and series of cascading side effects. Lions are exterminated by the Canaanites, Phoenicians, Romans, and later inhabitants of Mount Lebanon, leading to the proliferation of goats who crave tree roots, contributing to the deforestation of mountain areas, consequences that were hard to see ahead of time. Likewise, if you shut down a bank in New York, it will cause ripple effects from Iceland to Mongolia.
In the complex world, the notion of “cause” itself is suspect; it is either nearly impossible to detect or not really defined—another reason to ignore newspapers, with their constant supply of causes for things.
Stressors Are Information
Such a stressor would be certainly better than the mild but continuous stress of a boss, mortgage, tax problems, guilt over procrastinating with one’s tax return, exam pressures, chores, emails to answer, forms to complete, daily commutes—things that make you feel trapped in life.
Evolution and Unpredictability
In fact, the most interesting aspect of evolution is that it only works because of its antifragility; it is in love with stressors, randomness, uncertainty, and disorder—while individual organisms are relatively fragile, the gene pool takes advantage of shocks to enhance its fitness.
How to Become Mother Teresa
Further, my characterization of a loser is someone who, after making a mistake, doesn’t introspect, doesn’t exploit it, feels embarrassed and defensive rather than enriched with a new piece of information, and tries to explain why he made the mistake rather than moving on. These types often consider themselves the “victims” of some large plot, a bad boss, or bad weather.
Why the Aggregate Hates the Individual
Accordingly, the antifragility of the higher level may require the fragility—and sacrifice—of the lower one. Every time you use a coffeemaker for your morning cappuccino, you are benefiting from the fragility of the coffeemaking entrepreneur who failed. He failed in order to help put the superior merchandise on your kitchen counter.
Bottom-up Variations
Note another element of Switzerland: it is perhaps the most successful country in history, yet it has traditionally had a very low level of university education compared to the rest of the rich nations. Its system, even in banking during my days, was based on apprenticeship models, nearly vocational rather than the theoretical ones. In other words, on techne (crafts and know how), not episteme (book knowledge, know what).
Away from Extremistan
We switch from a system that produces steady but controllable volatility (Mediocristan), closer to the statistical “bell curve” (from the benign family of the Gaussian or Normal Distribution), into one that is highly unpredictable and moves mostly by jumps, called “fat tails.” Fat tails—a synonym for Extremistan—mean that remote events, those in what is called the “tails,” play a disproportionate role.
The Great Turkey Problem
We can also see from the turkey story the mother of all harmful mistakes: mistaking absence of evidence (of harm) for evidence of absence, a mistake that we will see tends to prevail in intellectual circles and one that is grounded in the social sciences. So our mission in life becomes simply “how not to be a turkey,” or, if possible, how to be a turkey in reverse—antifragile, that is. “Not being a turkey” starts with figuring out the difference between true and manufactured stability.
Chapter 6. Tell Them I Love (Some) Randomness
Variations also act as purges. Small forest fires periodically cleanse the system of the most flammable material, so this does not have the opportunity to accumulate. Systematically preventing forest fires from taking place “to be safe” makes the big one much worse. For similar reasons, stability is not good for the economy: firms become very weak during long periods of steady prosperity devoid of setbacks, and hidden vulnerabilities accumulate silently under the surface—so delaying crises is not a very good idea. Likewise, absence of fluctuations in the market causes hidden risks to accumulate with impunity. The longer one goes without a market trauma, the worse the damage when commotion occurs.
The Second Step: Do (Small) Wars Save Lives?
Again, we all love peace and we all love economic and emotional stability—but do not want to be suckers in the long term. We seek vaccination at every new school year (injecting ourselves with a bit of harm to build immunity) but fail to transfer the mechanism to political and economic domains.
Intervention and Iatrogenics
Medicine is comparatively the good news, perhaps the only good news, in the field of iatrogenics. We see the problem there because things are starting to be brought under control today; it is now just what we call the cost of doing business, although medical error still currently kills between three times (as accepted by doctors) and ten times as many people as car accidents in the United States. It is generally accepted that harm from doctors—not including risks from hospital germs—accounts for more deaths than any single cancer.
The Opposite of Iatrogenics
While we now have a word for causing harm while trying to help, we don’t have a designation for the opposite situation, that of someone who ends up helping while trying to cause harm. Just remember that attacking the antifragile will backfire. For instance, hackers make systems stronger. Or as in the case of Ayn Rand, obsessive and intense critics help a book spread.
In Praise of Procrastination—the Fabian Kind
Psychologists and economists who study “irrationality” do not realize that humans may have an instinct to procrastinate only when no life is in danger. I do not procrastinate when I see a lion entering my bedroom or fire in my neighbor’s library. I do not procrastinate after a severe injury. I do so with unnatural duties and procedures.
A Legal Way to Kill People
The more frequently you look at data, the more noise you are disproportionally likely to get (rather than the valuable part, called the signal); hence the higher the noise-to-signal ratio. And there is a confusion which is not psychological at all, but inherent in the data itself. Say you look at information on a yearly basis, for stock prices, or the fertilizer sales of your father-in-law’s factory, or inflation numbers in Vladivostok. Assume further that for what you are observing, at a yearly frequency, the ratio of signal to noise is about one to one (half noise, half signal)—this means that about half the changes are real improvements or degradations, the other half come from randomness. This ratio is what you get from yearly observations. But if you look at the very same data on a daily basis, the composition would change to 95 percent noise, 5 percent signal. And if you observe data on an hourly basis, as people immersed in the news and market price variations do, the split becomes 99.5 percent noise to 0.5 percent signal. That is two hundred times more noise than signal—which is why anyone who listens to news (except when very, very significant events take place) is one step below sucker.
On Suckers and Nonsuckers
To put it bluntly, Nero’s family’s wealth had peaked in 1804, so he did not have the social insecurity of other adventurers, and money to him could not possibly be a social statement—only erudition for now, and perhaps wisdom in old age. Excess wealth, if you don’t need it, is a heavy burden. Nothing was more hideous in his eyes than excessive refinement—in clothes, food, lifestyle, manners—and wealth was nonlinear. Beyond some level it forces people into endless complications of their lives, creating worries about whether the housekeeper in one of the country houses is scamming them while doing a poor job and similar headaches that multiply with money.
What the Nonpredictor Can Predict
Fat Tony did not believe in predictions. But he made big bucks predicting that some people—the predictors—would go bust. Isn’t that paradoxical? At conferences, Nero used to meet physicists from the Santa Fe Institute who believed in predictions and used fancy prediction models while their business ventures based on predictions did not do that well—while Fat Tony, who did not believe in predictions, got rich from prediction. You can’t predict in general, but you can predict that those who rely on predictions are taking more risks, will have some trouble, perhaps even go bust. Why? Someone who predicts will be fragile to prediction errors. An overconfident pilot will eventually crash the plane. And numerical prediction leads people to take more risks. Fat Tony is antifragile because he takes a mirror image of his fragile prey. Fat Tony’s model is quite simple. He identifies fragilities, makes a bet on the collapse of the fragile unit, lectures Nero and trades insults with him about sociocultural matters, reacting to Nero’s jabs at New Jersey life, collects big after the collapse. Then he has lunch.
The Domestication of Emotions
My idea of the modern Stoic sage is someone who transforms fear into prudence, pain into information, mistakes into initiation, and desire into undertaking.
Seneca also provides us a catalogue of social deeds: invest in good actions. Things can be taken away from us—not good deeds and acts of virtue.
On the Irreversibility of Broken Packages
This fragility that comes from path dependence is often ignored by businessmen who, trained in static thinking, tend to believe that generating profits is their principal mission, with survival and risk control something to perhaps consider—they miss the strong logical precedence of survival over success. To make profits and buy a BMW, it would be a good idea to, first, survive.
Seneca’s Barbell
I initially used the image of the barbell to describe a dual attitude of playing it safe in some areas (robust to negative Black Swans) and taking a lot of small risks in others (open to positive Black Swans), hence achieving antifragility. That is extreme risk aversion on one side and extreme risk loving on the other, rather than just the “medium” or the beastly “moderate” risk attitude that in fact is a sucker game (because medium risks can be subjected to huge measurement errors). But the barbell also results, because of its construction, in the reduction of downside risk—the elimination of the risk of ruin.
Away from the Golden Middle
And professions can be serial: something very safe, then something speculative. A friend of mine built himself a very secure profession as a book editor, in which he was known to be very good. Then, after a decade or so, he left completely for something speculative and highly risky. This is a true barbell in every sense of the word: he can fall back on his previous profession should the speculation fail, or fail to bring the expected satisfaction. This is what Seneca elected to do: he initially had a very active, adventurous life, followed by a philosophical withdrawal to write and meditate, rather than a “middle” combination of both. Many of the “doers” turned “thinkers” like Montaigne have done a serial barbell: pure action, then pure reflection. Or, if I have to work, I find it preferable (and less painful) to work intensely for very short hours, then do nothing for the rest of the time (assuming doing nothing is really doing nothing), until I recover completely and look forward to a repetition, rather than being subjected to the tedium of Japanese style low-intensity interminable office hours with sleep deprivation. Main course and dessert are separate. Indeed, Georges Simenon, one of the most prolific writers of the twentieth century, only wrote sixty days a year, with three hundred days spent “doing nothing.” He published more than two hundred novels.
The Teleological Fallacy
Never ask people what they want, or where they want to go, or where they think they should go, or, worse, what they think they will desire tomorrow. The strength of the computer entrepreneur Steve Jobs was precisely in distrusting market research and focus groups—those based on asking people what they want—and following his own imagination. His modus was that people don’t know what they want until you provide them with it.
Chapter 12. Thales’ Sweet Grapes
This kind of sum I’ve called in my vernacular “f * * * you money”—a sum large enough to get most, if not all, of the advantages of wealth (the most important one being independence and the ability to only occupy your mind with matters that interest you) but not its side effects, such as having to attend a black-tie charity event and being forced to listen to a polite exposition of the details of a marble-rich house renovation. The worst side effect of wealth is the social associations it forces on its victims, as people with big houses tend to end up socializing with other people with big houses. Beyond a certain level of opulence and independence, gents tend to be less and less personable and their conversation less and less interesting.
The Options of Sweet Grapes
Sour grapes—as in Aesop’s fable—is when someone convinces himself that the grapes he cannot reach are sour. The essayist Michel de Montaigne sees the Thales episode as a story of immunity to sour grapes: you need to know whether you do not like the pursuit of money and wealth because you genuinely do not like it, or because you are rationalizing your inability to be successful at it with the argument that wealth is not a good thing because it is bad for one’s digestive system or disturbing for one’s sleep or other such arguments.
Things That Like Dispersion
males and females have equal intelligence, but the male population has more variations and dispersion (hence volatility), with more highly unintelligent men, and more highly intelligent ones.
this explained why men were overrepresented in the scientific and intellectual community (and also why men were overrepresented in jails or failures). The number of successful scientists depends on the “tails,” the extremes, rather than the average.
No one at present dares to state the obvious: growth in society may not come from raising the average the Asian way, but from increasing the number of people in the “tails,” that small, very small number of risk takers crazy enough to have ideas of their own, those endowed with that very rare ability called imagination, that rarer quality called courage, and who make things happen.
Nature and Options
Let us call trial and error tinkering when it presents small errors and large gains.
Life Is Long Gamma
the largest generators of wealth in America historically have been, first, real estate (investors have the option at the expense of the banks), and, second, technology (which relies almost completely on trial and error). Further, businesses with negative optionality (that is, the opposite of having optionality) such as banking have had a horrible performance through history: banks lose periodically every penny made in their history thanks to blowups.
Next
An option is the weapon of antifragility.
Debunking Epiphenomena
If life is lived forward but remembered backward, as Kierkegaard observed, then books exacerbate this effect—our own memories, learning, and instinct have sequences in them. Someone standing today looking at events without having lived them would be inclined to develop illusions of causality, mostly from being mixed-up by the sequence of events. In real life, in spite of all the biases, we do not have the same number of asynchronies that appear to the student of history. Nasty history, full of lies, full of biases!
Chapter 15. History Written by the Losers
Practitioners don’t write; they do. Birds fly and those who lecture them are the ones who write their story. So it is easy to see that history is truly written by losers with time on their hands and a protected academic position.
Governments Should Spend on Nonteleological Tinkering, Not Research
Visibly the money should go to the tinkerers, the aggressive tinkerers who you trust will milk the option.
Note-Location 4171
In reference to VC funding
us use statistical arguments and get technical for a paragraph. Payoffs from research are from Extremistan; they follow a power-law type of statistical distribution, with big, near-unlimited upside but, because of optionality, limited downside.
Matt Ridley’s Anti-Teleological Argument
Collaboration has explosive upside, what is mathematically called a superadditive function, i.e., one plus one equals more than two, and one plus one plus one equals much, much more than three. That is pure nonlinearity with explosive benefits—we
Corporate Teleology
Corporations are in love with the idea of the strategic plan. They need to pay to figure out where they are going. Yet there is no evidence that strategic planning works—we even seem to have evidence against it. A management scholar, William Starbuck, has published a few papers debunking the effectiveness of planning—it makes the corporation option-blind, as it gets locked into a non-opportunistic course of action.
The Inverse Turkey Problem
Under positive asymmetries, that is, the antifragile case, the “unseen” is positive. So “empirical evidence” tends to miss positive events and underestimate the total benefits. As to the classic turkey problem, the rule is as follows. In the fragile case of negative asymmetries (turkey problems), the sample track record will tend to underestimate the long-term average; it will hide the defects and display the qualities.
The Touristification of the Soccer Mom
As usual, an ancient, here Seneca, detected the problem (and the difference) with his saying “We do not study for life, but only for the lecture room,” non vitae, sed scolae discimus,
An Antifragile (Barbell) Education
I was rather a barbell autodidact as I studied the exact minimum necessary to pass any exam, overshooting accidentally once in a while, and only getting in trouble a few times by undershooting. But I read voraciously, wholesale, initially in the humanities, later in mathematics and science, and now in history—outside a curriculum, away from the gym machine so to speak.
The minute I was bored with a book or a subject I moved to another one, instead of giving up on reading altogether—when you are limited to the school material and you get bored, you have a tendency to give up and do nothing or play hooky out of discouragement. The trick is to be bored with a specific book, rather than with the act of reading. So the number of pages absorbed could grow faster than otherwise. And you find gold, so to speak, effortlessly, just as in rational but undirected trial-and-error-based research. It is exactly like options, trial and error, not getting stuck, bifurcating when necessary but keeping a sense of broad freedom and opportunism. Trial and error is freedom.
I started, around the age of thirteen, to keep a log of my reading hours, shooting for between thirty and sixty a week, a practice I’ve kept up for a long time.
Mistaking the Unintelligible for the Unintelligent
“What is not intelligible to me is not necessarily unintelligent” is perhaps the most potent sentence in all of Nietzsche’s century—and we used a version of it in the prologue, in the very definition of the fragilista who mistakes what he does not understand for nonsense.
Why Is Fragility Nonlinear?
For the fragile, the cumulative effect of small shocks is smaller than the single effect of an equivalent single large shock.
For the antifragile, shocks bring more benefits (equivalently, less harm) as their intensity increases (up to a point).
How to Exit a Movie Theater
Just consider that the price of wheat more than tripled in the years 2004–2007 in response to a small increase in net demand, around 1 percent.3 Bottlenecks are the mothers of all squeezes.
How to Detect Who Will Go Bust
Such accelerating damage means that a large stone would eventually kill the person. Likewise a large market deviation would eventually kill the company. Once I figured out that fragility was directly from nonlinearity and convexity effects, and that convexity was measurable, I got all excited. The technique—detecting acceleration of harm—applies to anything that entails decision making under uncertainty, and risk management.
Now the Philosopher’s Stone
Take a conventional die (six sides) and consider a payoff equal to the number it lands on, that is, you get paid a number equivalent to what the die shows—1 if it lands on 1, 2 if it lands on 2, up to 6 if it lands on 6. The square of the expected (average) payoff is then (1+2+3+4+5+6 divided by 6)2, equals 3.52, here 12.25. So the function of the average equals 12.25. But the average of the function is as follows. Take the square of every payoff, 12+22+32+42+52+62 divided by 6, that is, the average square payoff, and you can see that the average of the function equals 15.17.
Someone with a linear payoff needs to be right more than 50 percent of the time. Someone with a convex payoff, much less. The hidden benefit of antifragility is that you can guess worse than random and still end up outperforming.
This explains my statement that you can be dumb and antifragile and still do very well.
How to Transform Gold into Mud: The Inverse Philosopher’s Stone
The square root of the expected (average) payoff is then √(1+2+3+4+5+6 divided by 6), equals √3.5, here 1.87. The function of the average equals 1.87. But the average of the function is as follows. Take the square root of every payoff, (√1+√2+√3+√4+√5+√6), divided by 6, that is, the average square root payoff, and you can see that the average of the function equals 1.80. The difference is called the “negative convexity bias” (or, if you are a stickler, “concavity bias”). The hidden harm of fragility is that you need to be much, much better than random in your prediction and knowing where you are going, just to offset the negative effect.
Let me summarize the argument: if you have favorable asymmetries, or positive convexity, options being a special case, then in the long run you will do reasonably well, outperforming the average in the presence of uncertainty. The more uncertainty, the more role for optionality to kick in, and the more you will outperform. This property is very central to life.
Where Is the Charlatan?
Just look at the “how to” books with, in their title, “Ten Steps for—” (fill in: enrichment, weight loss, making friends, innovation, getting elected, building muscles, finding a husband, running an orphanage, etc.). Yet in practice it is the negative that’s used by the pros, those selected by evolution: chess grandmasters usually win by not losing; people become rich by not going bust (particularly when others do); religions are mostly about interdicts; the learning of life is about what to avoid. You reduce most of your personal risks of accident thanks to a small number of measures.
Subtractive Knowledge
In life, antifragility is reached by not being a sucker.
So the central tenet of the epistemology I advocate is as follows: we know a lot more what is wrong than what is right, or, phrased according to the fragile/robust classification, negative knowledge (what is wrong, what does not work) is more robust to error than positive knowledge (what is right, what works). So knowledge grows by subtraction much more than by addition—given that what we know today might turn out to be wrong but what we know to be wrong cannot turn out to be right, at least not easily. If I spot a black swan (not capitalized), I can be quite certain that the statement “all swans are white” is wrong. But even if I have never seen a black swan, I can never hold such a statement to be true. Rephrasing it again: since one small observation can disprove a statement, while millions can hardly confirm it, disconfirmation is more rigorous than confirmation.
And, as expected, via negativa is part of classical wisdom. For the Arab scholar and religious leader Ali Bin Abi-Taleb (no relation), keeping one’s distance from an ignorant person is equivalent to keeping company with a wise man. Finally, consider this modernized version in a saying from Steve Jobs: “People think focus means saying yes to the thing you’ve got to focus on. But that’s not what it means at all. It means saying no to the hundred other good ideas that there are. You have to pick carefully. I’m actually as proud of the things we haven’t done as the things I have done. Innovation is saying no to 1,000 things.”
Less Is More
Accordingly, as I will show, 1 percent modification of systems can lower fragility (or increase antifragility) by about 99 percent—and all it takes is a few steps, very few steps, often at low cost, to make things better and safer. For instance, a small number of homeless people cost the states a disproportionate share of the bills, which makes it obvious where to look for the savings. A small number of employees in a corporation cause the most problems, corrupt the general attitude—and vice versa—so getting rid of these is a great solution. A small number of customers generate a large share of the revenues. I get 95 percent of my smear postings from the same three obsessive persons, all representing the same prototypes of failure (one of whom has written, I estimate, close to one hundred thousand words in posts—he needs to write more and more and find more and more stuff to critique in my work and personality to get the same effect). When it comes to health care, Ezekiel Emanuel showed that half the population accounts for less than 3 percent of the costs, with the sickest 10 percent consuming 64 percent of the total pie.
Convincing—and confident—disciplines, say, physics, tend to use little statistical backup, while political science and economics, which have never produced anything of note, are full of elaborate statistics and statistical “evidence” (and you know that once you remove the smoke, the evidence is not evidence).
I discovered that I had been intuitively using the less-is-more idea as an aid in decision making (contrary to the method of putting a series of pros and cons side by side on a computer screen). For instance, if you have more than one reason to do something (choose a doctor or veterinarian, hire a gardener or an employee, marry a person, go on a trip), just don’t do it. It does not mean that one reason is better than two, just that by invoking more than one reason you are trying to convince yourself to do something. Obvious decisions (robust to error) require no more than a single reason. Likewise the French army had a heuristic to reject excuses for absenteeism for more than one reason, like death of grandmother, cold virus, and being bitten by a boar. If someone attacks a book or idea using more than one argument, you know it is not real: nobody says “he is a criminal, he killed many people, and he also has bad table manners and bad breath and is a very poor driver.”
From Simonides to Jensen
Recall that the most fragile is the predictive, what is built on the basis of predictability—in other words, those who underestimate Black Swans will eventually exit the population.
To Age in Reverse: The Lindy Effect
For the perishable, every additional day in its life translates into a shorter additional life expectancy. For the nonperishable, every additional day may imply a longer life expectancy.
A Few Mental Biases
We notice what varies and changes more than what plays a large role but doesn’t change. We rely more on water than on cell phones but because water does not change and cell phones do, we are prone to thinking that cell phones play a larger role than they do.
Turning Science into Journalism
The problem in deciding whether a scientific result or a new “innovation” is a breakthrough, that is, the opposite of noise, is that one needs to see all aspects of the idea—and there is always some opacity that time, and only time, can dissipate.
So time can act as a cleanser of noise by confining to its dustbins all these overhyped works.
What Does Not Make Sense
If something that makes no sense to you (say, religion—if you are an atheist—or some age-old habit or practice called irrational); if that something has been around for a very, very long time, then, irrational or not, you can expect it to stick around much longer, and outlive those who call for its demise.
First Principle of Iatrogenics (Empiricism)
Today trans fat is widely banned as it turned out that it kills people, as it is behind heart disease and cardiovascular problems.
Second Principle of Iatrogenics (Nonlinearity in Response)
When hypertension is mild, say marginally higher than the zone accepted as “normotensive,” the chance of benefiting from a certain drug is close to 5.6 percent (only one person in eighteen benefit from the treatment). But when blood pressure is considered to be in the “high” or “severe” range, the chances of benefiting are now 26 and 72 percent, respectively (that is, one person in four and two persons out of three will benefit from the treatment). So the treatment benefits are convex to condition (the benefits rise disproportionally, in an accelerated manner). But consider that the iatrogenics should be constant for all categories! In the very ill condition, the benefits are large relative to iatrogenics; in the borderline one, they are small. This means that we need to focus on high-symptom conditions and ignore, I mean really ignore, other situations in which the patient is not very ill.
Another way to view it: the iatrogenics is in the patient, not in the treatment. If the patient is close to death, all speculative treatments should be encouraged—no holds barred. Conversely, if the patient is near healthy, then Mother Nature should be the doctor.
Burying the Evidence
talking about radiation, few wonder why, after hundreds of million of years of having our skins exposed to sun rays, we suddenly need so much protection from them—is it that our exposure is more harmful than before because of changes in the atmosphere, or populations living in an environment mismatching the pigmentation of their skin—or rather, that makers of sun protection products need to make some profits?
How to Medicate Half the Population
In addition, we now know that the craze against fats and the “fat free” slogans result from an elementary mistake in interpreting the results of a regression: when two variables are jointly responsible for an effect (here, carbohydrates and fat), sometimes one of them shows sole responsibility. Many fell into the error of attributing problems under joint consumption of fat and carbohydrates to fat rather than carbohydrates.
the great statistician and debunker of statistical misinterpretation David Freedman showed (very convincingly) with a coauthor that the link everyone is obsessing about between salt and blood pressure has no statistical basis. It may exist for some hypertensive people, but it is more likely the exception than the rule.
Subtraction Adds to Your Life
As Ennius wrote, “The good is mostly in the absence of bad”; Nimium boni est, cui nihil est mali.
Likewise, happiness is best dealt with as a negative concept; the same nonlinearity applies. Modern happiness researchers (who usually look quite unhappy), often psychologists turned economists (or vice versa), do not use nonlinearities and convexity effects when they lecture us about happiness as if we knew what it was and whether that’s what we should be after. Instead, they should be lecturing us about unhappiness (I speculate that just as those who lecture on happiness look unhappy, those who lecture on unhappiness would look happy); the “pursuit of happiness” is not equivalent to the “avoidance of unhappiness.” Each of us certainly knows not only what makes us unhappy (for instance, copy editors, commuting, bad odors, pain, the sight of a certain magazine in a waiting room, etc.), but what to do about it.
Convexity Effects and Random Nutrition
So take the following principles derived from the random structure of the environment: when we are herbivores, we eat steadily; but when we are predators we eat more randomly. Hence our proteins need to be consumed randomly for statistical reasons.
Chapter 23. Skin in the Game: Antifragility and Optionality at the Expense of Others
A half-man (or, rather, half-person) is not someone who does not have an opinion, just someone who does not take risks for it.
Hammurabi
The second heuristic is that we need to build redundancy, a margin of safety, avoiding optimization, mitigating (even removing) asymmetries in our sensitivity to risk.
The Talker’s Free Option
There is another central element of ancient Mediterranean ethics: Factum tacendo, crimen facias acrius: For Publilius Syrus, he who does not stop a crime is an accomplice. (I’ve stated my own version of this in the prologue, which needs to be reiterated: if you see fraud and don’t say fraud, you are a fraud.)
The Stiglitz Syndrome
Never ask anyone for their opinion, forecast, or recommendation. Just ask them what they have—or don’t have—in their portfolio.
The psychologist Gerd Gigerenzer has a simple heuristic. Never ask the doctor what you should do. Ask him what he would do if he were in your place. You would be surprised at the difference.
The Problem of Frequency, or How to Lose Arguments
Suckers try to win arguments, nonsuckers try to win.
The Right Decision for the Wrong Reason
More generally, for Mother Nature, opinions and predictions don’t count; surviving is what matters.
Champagne Socialism
Never listen to a leftist who does not give away his fortune or does not live the exact lifestyle he wants others to follow.
Options, Antifragility, and Social Fairness
As I am writing these lines the United States stock market has cost retirees more than three trillion dollars in losses over the past dozen years compared to leaving money in government money market funds (I am being generous, the difference is even higher), while managers of the companies composing the stock market, thanks to the asymmetry of the stock option, are richer by close to four hundred billion dollars.
Even more outrageous is the fate of the banking industry: banks have lost more than they ever made in their history, with their managers being paid billions in compensation—taxpayers take the downside, bankers get the upside.
The Antifragility and Ethics of (Large) Corporations
Have you noticed that while corporations sell you junk drinks, artisans sell you cheese and wine? And there is a transfer of antifragility from the small in favor of the large—until the large goes bust. The problem of the commercial world is that it only works by addition (via positiva), not subtraction (via negativa): pharmaceutical companies don’t gain if you avoid sugar; the manufacturer of health club machines doesn’t benefit from your deciding to lift stones and walk on rocks (without a cell phone); your stockbroker doesn’t gain from your decision to limit your investments to what you see with your own eyes, say your cousin’s restaurant or an apartment building in your neighborhood; all these firms have to produce “growth in revenues” to satisfy the metric of some slow thinking or, at best, semi-slow thinking MBA analyst sitting in New York. Of course they will eventually self-destruct, but that’s another conversation.
A rule then hit me: with the exception of, say, drug dealers, small companies and artisans tend to sell us healthy products, ones that seem naturally and spontaneously needed; larger ones—including pharmaceutical giants—are likely to be in the business of producing wholesale iatrogenics, taking our money, and then, to add insult to injury, hijacking the state thanks to their army of lobbyists. Further, anything that requires marketing appears to carry such side effects. You certainly need an advertising apparatus to convince people that Coke brings them “happiness”—and it works.
Artisans, Marketing, and the Cheapest to Deliver
We accept that people who boast are boastful and turn people off. How about companies? Why aren’t we turned off by companies that advertise how great they are?
Wealth Without Independence
There is a phenomenon called the treadmill effect, similar to what we saw with neomania: you need to make more and more to stay in the same place. Greed is antifragile—though not its victims.
This class of persons is like Tantalus, who was subjected to an eternal punishment: he stood in a pool of water underneath a fruit tree and whenever he tried to grab the fruit it moved away and whenever he tried to drink, the water receded.
The Professionals and the Collective
The definition of the free man, according to Aristotle, is one who is free with his opinions—as a side effect of being free with his time.
Chapter 25. Conclusion
Everything gains or loses from volatility. Fragility is what loses from volatility and uncertainty. The glass on the table is short volatility.
The glass is dead; living things are long volatility. The best way to verify that you are alive is by checking if you like variations. Remember that food would not have a taste if it weren’t for hunger; results are meaningless without effort, joy without sadness, convictions without uncertainty, and an ethical life isn’t so when stripped of personal risks.