Monthly Archives: February 2015

Academics find it “irrational” that one can prefer apples to oranges…

Academics find it “irrational” that one can prefer apples to oranges, oranges to pears, but pears to apples (something called intransitivity of preferences). I leave aside the problem that in real life choices have synchronies: I am not (dynamically) inconsistent if I prefer soup to grapes at the beginning of dinner, but grapes to soup at the end. Things never presents themselves to us in a textbook way, but over time and in different contexts. But there there is a deeper logic for such inconsistency –even in the *static* case.

Recall that the antifragile is what likes a bit of randomness.

It may be very efficient, in the long run, to inject some randomness in one’s choices in order to span a broader set of objects, and intransitivity is one way to do so. Break the routine of choices. This is similar to gift giving: a gift is something that you would not buy otherwise; it too breaks your routine of choices — like a book you would have never thought of buying.

Mother nature may have a way to force you to make “mistakes” of small consequence may reveal deeper preferences or more interesting attributes of the world. This is optionality.

via Academics find it “irrational” that one can… – Nassim Nicholas Taleb.

How a Black Swan event can take place without anyone noticing…

How a Black Swan event can take place without anyone noticing: error propagation and dimensionality.

 

via Nassim NicholنTaleb on Twitter: “How a Black Swan event can take place without anyone noticing: error propagation and dimensionality. https://t.co/6sjxQI8EHG”.

This is a critical 1 min lecture to understand independence, antifragility, “f** you money”

This is a critical 1 min lecture to understand independence, antifragility, “f** you money”, selfownership, and many things.

(This came 8 years after the f*** you money idea was formulated in The Black Swan, except that it missed the critical later development as Fat Tony explained that ” f*** you” is not financial, but a state of mind, people on minimum wage are more likely to have it.)

(Thanks G. Panterov)


via This is a critical 1 min lecture to understand… – Nassim Nicholas Taleb.

For comments: It takes time for things to break…

For comments:
It takes time for things to break, but they eventually break, & there should be no rush although our impulse is to think that they will collapse immediately after we become aware of the problem. Give things time… 3 to 8 years in today’s complex system. By definition the fragile cannot be selfsustaining as the probability of a collapse increases with time.

We had to wait 4 years for Fannie Mae to go bust (after detection of their fragility), but it did go bust; 5 years for Syria to blow up, but it did; bankers are losing power 5 years after the crisis. We thought in 2009 that the econ establishment would be discredited and… it is starting to happen about 5 years later. We thought in 2010 that the Greeks would be in the streets and here they are…

So what’s on the list (of the unsustainably fragile)? For me, Saudi Arabia, Elsevier/Wiley (academic publishing will be Uberized), the Fed’s monopoly, Monsanto, bureaucrats in Europe w/lifetime employment, Oligarchs, etc.Please be specific, avoid the vague and the general.

via For comments: It takes time for things… – Nassim Nicholas Taleb.