Skip to content Nassim Nicholas Taleb: The “Fragility” Crisis is Just Begun

Christopher Lydon / Nassim Taleb telephone interview.

Link to source and synopsis.

3. On bailouts: My analogy is to the gambler who is now gambling with the trust fund of his unborn great-great-granchildren… Prudence should be the first thing on the agenda of governments, not speculation. Stimulus packages are speculation… We are gambling on a massive recovery. It’s too big a gamble, and besides it’s immoral.

2. In the economic crisis, and in the Gulf of Mexico, what we should be discovering is not who made what mistake, but the fact of fragility. Alas, what we don’t learn is… that we don’t learn.

1. No government can fortify something that’s inherently fragile.


  1. David L. wrote:

    I had a good time trying to discuss “The Black Swan” on the comment section of Lydon’s podcast with Taleb and urging people to read the book, excellent podcast, though.

    Thursday, June 10, 2010 at 1:16 pm | Permalink
  2. JohnH wrote:

    Nice work David! Have you waded into any of NNT’s Facebook discussions?

    Thursday, June 10, 2010 at 10:45 pm | Permalink
  3. David L. wrote:

    Actually, I have read the ethical questions, but I been caught doing other things. However, the more I think of the financial crisis or if it has just begun, the more I feel like continuing on supporting Taleb rather than my own things. I do have to thank you, again, on aggregating news on Taleb, as I find your site excellent for all his whereabouts. What I hope is that his ideas go main stream or reach the tipping point and, maybe, we will some change. Or the next disaster will happen and he would be vindicated again, which would be unfortunate. Ethically, speaking, yes, a crime was committed and those that know or who have been made aware of it should, surely, do something, but I’m still thinking about it since ethical questions are tough.

    Tuesday, June 15, 2010 at 3:30 pm | Permalink
  4. JohnH wrote:

    Hi David,
    What I was thinking was that the ultimate way Taleb could affirm the efficacy of his approach is by helping to provide robustness to the people who read him. I don’t know if you saw my questions on his Facebook, but I was actually trying to bait him into giving up a formula for ‘the rest of us’ (i.e. the unrobust, cash poor) which would protect what little we have in the event of hyperinflation. I started by asking a blatant investment question. He didn’t want to discuss the market or investments. I then put it in the Fat Tony question… what would Fat Tony tell his auntie to do with that $10k she’s got hidden under the bed. And then finally (last one I promise) I put it in the form of an ethical question… (ETHICAL QUESTION: If you see a train coming and, because of your perspective, background, and reasoning skills, you’re in a position to tell people how to get out of the way, would it be unethical not to?) Which NNT answered, but I guess he didn’t get my implication. And that’s ok. I was just thinking that if it hit’s the fan and those of us who followed a Taleb inspired formula for robustness were in fact ok and could say so and prove it, then I think Taleb’s ideas could make even MORE of an impact, because then it wouldn’t just be NNT and the people at Universa who would be saying ‘I told you so’, but thousands of people who took his advice.

    Tuesday, June 15, 2010 at 3:48 pm | Permalink
  5. David L. wrote:

    Yes, I went to facebook and read your questions. It seems Taleb doesn’t want to talk about vulgar finance. But the most secure asset would probably be Treasury bills and cash under the mattress, even if its worth nothing after hyper-inflation, of course, in a worst case scenario, or even gold—-especially when it comes to money. But I know I’m breaking one of his rules: only give negative advise. Or what we know doesn’t work. I just skimmed through his ten principals and it is mostly negative, what we already know doesn’t work, thanks to the financial crisis. I know most prudent corporation have lots of cash on the side, like Apple or Microsoft. Now, getting away from money, the way I’m working on robustness is by following his health advise(jumping on rocks mostly), and the notions of how Nature robustefies species,or, how evolution has slowly, but surely,made us naturally robust against improbable events by proving redundancy. Indeed, talking more on the subject of redundancy(mother-nature’s insurance), if you want to be a wild about, it wouldn’t be a bad idea to hold many different currencies: Yuang, Pesos, rumples, heck, even diamonds, if you can get a hold of them. But, for me, money is beneath me; and way down on my list of my priorities at the current stage of my life. I’m interested on his idea; and that it spills into so many domains of life. Not only financial,but mathematical, and now even biological. If we accept his Black Swan, like he has said on the book and lectures, the worst thing that can happen is not hyperinflation, but an epidemic or WW3, or a Nuclear Disaster, or, to get really wild, a Meteor hitting the earth.(This is feasible, as it did happen to the Dinosaurs)Or even the Second Coming. So, individually, what we can do is be prepare on the financial side of things and also on the biological side. Now the problem is that the way Society is organize today, especially modern States, is based on forecasting; however, Taleb’s Black Swan can’t be forecast, and yet our leaders are beings fools of randomness. Also, on his pages, he says: “(b) the feeling of obligation to engage in activism to robustify society”; he wants to spread his ideas; because the powesr that be are too entrench in politics, and oligarchy-style scratching of backs to the see the massive train approaching.

    Tuesday, June 15, 2010 at 8:12 pm | Permalink
  6. David L. wrote:

    Sorry, I click submit by mistake,and I wasnt’ done, sorry if I bother you: if Taleb is vindicated again, something drastic has to happen. I mean,either taxpayers will continue to get swindle by charlatans or we apply his ideas. I think he is the greatest living philosopher. And hopefully I’ll live long enough to continue to study them. But you are right on the feeling of “I told you so” that one would get on he being right again, and those that follow him would also feel. We I try to explain his ideas. I get (a) it sounds like conspiracy theory, yeah, like UFOs. (b) It is too complex (c) you have gone crazy. And this one can be from all kinds of different people that believe other things. My response to (a)No, his theory is base on empirical, albeit, skeptical Science; and he Taleb goes around the world giving lectures to head-of-States(Britain),Universities, and such. I’m highly skeptical of theories, so I wouldn’t accept a theory if it wasn’t evidence base. (b) it’s too complex, yes, but if you read the books,study them, think I about them, you’ll get it, although you probably be doubting the existence of reality every morning, you know: Nobody know what is going on. (c) I’m definitely Not crazy. Reasoning brought to study Taleb’s ideas, and only imbeciles would think otherwise. And, for me, economist are crazy. I have also being vex by his ethical questions. For me it sounds like a challenge, we know things have gone wrong, and either we react to it or be ashamed at our own existence—especially if you know about it. My plan right now, is to continue on studying his idea and books, and aphorisms.

    Tuesday, June 15, 2010 at 8:35 pm | Permalink
  7. David L. wrote:

    sorry for the typos, late at night. : D

    Tuesday, June 15, 2010 at 8:37 pm | Permalink
  8. JohnH wrote:

    Thanks David! When I talk about it with people who haven’t read the book, I try to get them to understand the difference between Mediocristan and Extremistan- that certain domains do allow the application of logic, reason and prediction, but that others do not. I typically compare the career of the dentist vs. the guitar player. I also like to talk about the heaviest person in the room, vs. the richest person in the room. The ‘Start Here’ category of the blog is meant to serve as an intro.
    When I was younger I read and thought a lot about philosophy. I still find it fascinating. What’s especially interesting about Taleb’s philosophy to me, is that it has very practical implications- about what to do, how to behave, how to organize society etc. Money itself isn’t all that important- it’s about not being a turkey.
    Hey if you ever feel like composing a guest post I’d be happy to put it on the blog.

    Tuesday, June 15, 2010 at 9:08 pm | Permalink

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