[[Antifragile]]: Things That Gain from

Disorder
Book by [[Nassim Nicholas Taleb]]
Full text source
[[TL;DR]]
Prologue
“I’d rather be dumb and antifragile than extremely smart and fragile, any time.”
Nassim Taleb says that it is far easier to figure out if something is fragile than to predict the
occurrence of [[a Black Swan event]] because fragility can be measured, but the risk cannot.
Anything that has more upside than downside from random events (or certain shocks) is antifragile;
the reverse is fragile.
The largest cause of fragility is the absence of "skin in the game", which means hurting others in
order to become antifragile. However, antifragility should not come at the expense of the fragility of
others.
The idea of antifragility is to avoid interference with things we don’t understand. Opposite of that is
people that Taleb terms "[[the fragilista]]. The fragilista falls for the Soviet-Harvard delusion, that is,
the (unscientific) overestimation of the reach of scientific knowledge.
Due to such delusion, he is what is called a naive rationalist/rationalizer/rationalist, in the sense that
he believes that the reasons behind things are automatically accessible to him. It should be noted,
however, that rationalizing is not the same thing as rational.
It's true that simplicity has been difficult to implement in modern life because it is against the spirit of
a certain brand of people who seek sophistication in order to justify their profession. However, in
reality, less is more and usually more effective.
What Taleb proposes is a road map to modify our man-made systems to let the simple and natural
take their course, how to look our ignorance in the face and not be ashamed of being human, but in
fact, be aggressively and proudly human!
Tragically, modernity has replaced ethics with legalese, and the law can be toyed with if you have a
good lawyer. Taleb states the first ethical rule: If you see fraud and do not say fraud, you are a
fraud. Abitraging systems is a theft of antifragility.
"Just as being nice to the arrogant is no better than being arrogant toward the nice." Being
accommodating towards anyone committing a nefarious action condones it. Compromising is
condoning.
The Triad – Fragile, Robust, Antifragile
All systems can be put into one of these three categories:
Taleb uses examples from ancient Greece to explain the triad of Fragile, Robust, and Antifragile.
Damocles, the one who dines with a sword dangling over his head, is fragile. Just a little movement
to the string holding the sword will kill him.
The Phoenix, the one which dies and is reborn from its ashes, is robust. It always returns to the
same state when suffering a massive stressor.
But the Hydra, who grows two heads when one is cut off, demonstrates Antifragility.
The Antifragile: An Introduction
Between Damocles and Hydra
Taleb states that sophistication brings fragility to Black Swans. The reason is, as societies gain in
complexity, sophistication, and more specialization, they become increasingly vulnerable to collapse.
However, this doesn't have to be the case, for those who are willing to go the extra step and
understand the matrix of reality.
It is also explained that depriving systems of stressors, which are vital, can downright harmful.
Overcompensation and Overreaction Everywhere
The concept of overcompensation has been explained using the following analogy: if you need
something urgently done, give the task to the busiest person in the office. The rationale is, most
humans misuse their free time, and as a result, they become dysfunctional, lazy, and unmotivated.
However, the busier they get, the more active they are at other tasks.
Lucretius problem is the term that Taleb gives to the fallacy of human's taking the worst things to
have ever happened as the only worst thing that can happen. Reality never follows this route.
The author talks about post-traumatic growth, the instances of human beings becoming better and
“more” after traumatic accidents, as an ample of antifragility. Similarly, when we bounce back from
failures and grow out of frustrations and hardships, we also show antifragility.
In Latin, there is a saying that sophistication is born out of hunger. Taleb says the excess energy
released from overreaction to setbacks is what innovates! These things are never achieved by
planning or education. For instance, highly decorated Harvard professors of entrepreneurship and
innovation never innovated anything, and same goes for the highly expensive consultants!
The author tells us that we do not want to “control” our reputation, as it's impossible due to
information flow. Instead, we should focus on altering our exposure, by putting ourselves in a
position or situation prone to reputational damage. Most modern professions are not antifragile.
The Cat and the Washing Machine

According to Taleb, the secret of life seems to be antifragility. Everything that has life in it is to some
extent antifragile.
There is a difference between complicated and complex systems: complex systems have many
interdependencies, which make them antifragile.
Causal opacity is the term that describes how hard it is to see the arrow from cause to consequence,
which makes much of the conventional methods of analysis (standard logic) inapplicable.
Modernity And The Denial of Antifragility
What Kills Me Makes Others Stronger

The fragility of every startup is what makes the whole economy resilient -as Schumpeter calls it
"creative destruction of capitalism". The author says that restaurant as a whole is a very strong
category, but it comes at the expense of high competition, and also high failure rates, of every one of
them.
Evolution thrives on antifragility! Even though individual organisms are relatively fragile, the gene
pool takes advantage of shocks to enhance its fitness. Therefore, random stressors (within reason)
help species evolve quickly and improve.
Errors are valuable as long as they are made in isolation, and learned from. They help the overall
system improve (examples would be airlines; counter: economy - highly inter-dependent).
Disasters also serve a similar purpose, says Taleb. The Titanic, for example, was a disaster, but it
was a catalyst for change in the ship cruising industry, and it made the system stronger.
It's interesting that Taleb defines a loser as someone who, when he makes a mistake feels
embarrassed and instead of introspecting and becoming better with the new piece of information,
tries to explain why instead of moving on.
Taleb notes that an individual who has never sinned is less reliable than the one who has only
sinned once, or more (but not the same sin twice).
Some systems, like the aviation industry, is set to be antifragile by getting better after a crash, but
the same cannot be said for the financial system, says the author. In the economy and finance, a big
error causes a domino effect because all the nodes are connected and interlinked.
The goal of a system should be to let single individuals or institutions fail without dragging anyone
else down because the failure of individual economic agents is necessary for the whole to improve.
This is the opposite of what governments are doing by bailing out companies at the expense of the
whole system, which ends up propping up the wealthy and damaging the poor.
The Souk and the Office Building

Taleb says that professions such as artisans, prostitutes, and taxi drivers are more robust to black
swans and more antifragile than employees, even high earning employees. The reason is, the more
variability a system has, the less Black Swan–prone it is. Risks are visible here, while in other
professions, they are invisible. Employees risks are hidden and thus their wage can easily go to zero
if they get fired.
A collection of small units is more antifragile than large ones. Taleb says the large is doomed to
break, and this is universally seen in large corporations, very large mammals, and large
administrations. He says the reason for this is qualitative: the increase in the number of persons in a
given community alters the quality of the relationship between parties, as there is a transformation.
Here, the conversations between people switch from the mundane (but effective) to abstract
numbers, more academic, but it's less effective.

According to the point presented above, the way people handle local affairs is vastly different from
the way they handle large, abstract public expenditures. Because in local affairs, our biology sells us
out, such as feeling shame, avoiding eye contact or feeling uncomfortable if we've done something
wrong. But the biological response is absent on a larger scale due to a lack of social contact where
the brain (i.e. statistics and graphs) leads rather than emotions.
Taleb states that anything locked into planning will fail precisely because of planning. According to
him, it's a myth that planning helps corporations, when in fact, the world is too random and
unpredictable to base a policy on the visibility of the future. What survives, in the long run, comes
from the interplay of fitness to survive in random changes to its environmental conditions.
[[The Great Turkey Problem]]

"Mistaking absence of evidence (of harm) for evidence of absence"

This kind of mistake tends to prevail in intellectual circles and one that is grounded in the social
sciences.
Tell Them I Love (Some) Randomness
Taleb uses a great analogy of a [[punctual person and a non-punctual person]] to explain why
volatility is beneficial and helps in coping with randomness.
Variations also act as purges, for instance, small forest fires periodically cleanse the forest of the
most flammable material, and hence not allowing them to accumulate. However, systematically
preventing forest fires will have the opposite effect if a fire does eventually take place.
Similarly, stability is not good for the economy because firms become weak during long periods
of steady prosperity which is devoid of setbacks, allowing hidden vulnerabilities to accumulate
silently. Taleb says that systems need a relief valve and need to be able to re-adjust freely, without
intervention.
The metaphor of [[Buridan’s Donkey]], named after the medieval philosopher Jean de Buridan,
explains that when some systems are stuck in a dangerous impasse, only randomness can set them
free. Hence an absence of randomness equals guaranteed death!
What to Tell the Foreign Policy Makers
"Seeking stability by achieving stability has been a great sucker game for economic and foreign
policies"
"One of life’s packages: no stability without volatility"
Naive Intervention
Iatrogenics: net loss -damage from treatment in excess of the benefits (usually hidden or delayed).
Every time you visit a doctor and get a treatment, you incur risks of medical harm, which should be
analyzed the way we analyze other tradeoffs: probable benefits minus probable costs.
Iatrogenics is compounded by the “agency problem” which emerges when one party (the agent) has
personal interests that are divorced from those of the one using his services (the principal). An
agency problem, for instance, is present with:
The stockbroker and medical doctor, whose ultimate interest is their own checking account, not your
financial and medical health, and who give you advice that is geared to benefit themselves.
Politicians working on their career.
Taleb says he is not against intervention in any way, it’s just that he often sees too much, naive
intervention, and so, no naïve intervention implies no iatrogenics. Therefore, the source of harm lies
in the denial of antifragility, and the impression that we humans are so necessary to make things
function.
Theories are superfragile; they come and they go. [[Phenomenologies]] stay, and they are "robust”
and usable, whilst theories are overhyped and unreliable for decision making -outside the bounds of
physics.
Taleb says neither over intervention or under intervention is the right approach. Rather staunch
intervention in some areas, such as ecology or to limit the economic distortions and moral hazard
caused by large corporations is the correct way to look at it.
So what should we control? As a rule, intervening to limit the size (of companies, airports, or sources
of pollution), concentration, and speed is beneficial in reducing Black Swan risks.
To conclude, the best way to mitigate interventionism is to ration the supply of information as
naturally as possible. However, this is hard to accept in the age of the Internet. The more data you
consume, the less you know about what’s going on, and the more iatrogenics you will cause. People
are still under the illusion that “science" means more data.
Catalyst-as-Cause Confusion
In 2011, Barack Obama blamed an intelligence failure for the government’s not foreseeing the
revolution in Egypt that took place that spring, missing the point that it is the suppressed risk in the
statistical “tails” that matters. His mistake illustrates the illusion of local causal chains, that is,
confusing catalysts for causes and assuming that one can know which catalyst will produce which
effect. The final episode of the upheaval in Egypt was unpredictable for all observers, especially
those involved.
Taleb says that political and economic "tail events" are unpredictable, and their probabilities are not
scientifically measurable. No matter how many dollars are spent on research, predicting revolutions
is not the same as counting cards; humans will never be able to turn politics and economics into the
tractable randomness of blackjack.
Prediction as a Child of Modernity
There are ample empirical findings to show that providing someone with a random numerical
forecast increases his risk taking, even if that person knows the projections are random.
Taleb says if you have extra cash in the bank (or other forms of back-up) as a failsafe, you don’t
need to know with precision which event will cause potential difficulties. This demonstrates how
redundancy is a nonpredictive, or rather a less predictive mode of action. However, because of our
fragility, we feel the need to predict these things with accuracy.
A Nonpredictive View of The World
Fat Tony and the Fragilistas
Taleb talks quite a bit about himself and his ideas here. He says that there is another dimension to
the need to focus on actions and avoid words. The dependence on external recognition from others
is cruel and unfair, and hence not focusing on that will help you in the long run. Taleb advises
staying robust to how others treat you.
Seneca’s Upside and Downside
According to Taleb, stoicism makes you desire the challenge of a calamity, and Stoics look down on
luxury. Seneca, a Roman Stoic philosopher, wrote about people who live lavish lifestyles: "He is in
debt, whether he borrowed from another person or from fortune."
The stoic belief results in pure robustness because being immune from one’s external
circumstances, (good or bad), and fragility is absent from the decisions one makes. Taleb says
therefore, aandom events won’t affect us either way (we are too strong to lose, and not greedy to
enjoy the upside), so we stay in the middle column of the Triad.
Success brings an asymmetry because once you attain a position of success, you have a lot more to
lose than to gain, hence making you fragile. For example, when you become rich, the pain of losing
your fortune exceeds the emotional gain of getting additional wealth, so you start living under
continuous emotional threat.
Stoicism is about the domestication, not the elimination, of emotions, and Taleb's version of the
modern Stoic sage is someone who transforms fear into prudence, pain into information, mistakes
into initiation, and desire into undertaking.
Taleb tells us to take a simple test to determine our antifragility: if I have "nothing to lose" then it is all
gain and I am antifragile.
Never Marry the Rockstar
Taleb introduces the barbell (or bimodal) strategy as a way of being antifragile. The barbell strategy
means covering your downsides while increasing your upsides. You play it very safe on one side so
that you can take more risks on another side, whilst avoiding being in the middle. If the risky part
plays out badly, you’re still going to be okay. If a black swan event will make the risks pay off big,
you profit handsomely.
Taleb gives a lot of [[examples of barbells]] and in line with the title o this chapter he says, a barbell
strategy is the one where a woman marries the boring accountant in order to have stability in her life
but also doesn't miss the opportunity to sleep with the exciting rockstar (same could not be said if the
roles were reversed!)
[[Optionality]], Technology, and Antifragility
Thale’s Sweet Grapes
Taleb says that even though there is the freedom that comes with having wealth, the downsides are
all the social aspects that it forces on its victims, as people with big houses tend to end up
socializing with other people with big houses.
Growth in society may not come from raising the average the Asian way, but from increasing the
number of people in the “tails", those small number of risk-takers crazy enough to have ideas of their
own, those endowed with that very rare ability called imagination, a rarer quality called courage, and
who make things happen.
Lecturing Birds on How to Fly

Teleological fallacy: the illusion that you know exactly where you are going, and that you knew
exactly where you were going in the past, and that others have succeeded in the past by knowing
where they were going.
Taleb points out that a Department of Ornithology at Hardvard could explain the mathematics of
flight and how a bird's wings work, but the birds do not need to understand that in order to fly! He
also reflects upon our lack of imagination through the “invention” of carrying on luggage with wheels.
He says it took 6,000 years from the invention of the wheel before someone thought about stripping
two of them beneath luggage to simplify everyone’s life. This invention came 30 years after the
moon landing, which seemed such a great thing, but the moon landing did little to improve our
lives, than the wheeled luggage did!
When Two Things Are not the “Same Thing”
Taleb says that most people have it all wrong with education and standards of living. It’s not
education that improves standards of living, it’s the other way around. Wealth leads to the rise of
education. However, education is not even strictly required for a wealthy, antifragile society.
Theory must be differentiated from practice and, empirically speaking, your grandmother’s advice is
far more superior to what you get in business school because scholarship and organized education
are not the same.
When we assume some information is necessary and important when it really isn’t, we’re committing
the [[green lumber fallacy]].
It is unfruitful to equate skills at doing with skills at talking. However, entrepreneurs are selected to
be just doers, not thinkers; and doers do, they don’t talk, and it would be unfair, and wrong to
measure them in the talk department. This is a flaw in our way of thinking.
History Written by the Losers
Governments should spend on nonteleological tinkering, NOT research because new great
discoveries and breakthrough happen by trying things out, by tinkering around, rather than
theoretical knowledge plays catch up and explains it.
Taleb sums up a few rules:
Look for optionality (many options)
Open-ended payoffs
Invest in people, not business plans
Apply the barbell principle (limit your downside)
A Lesson in Disorder
In this chapter, Taleb talks about education and soccer moms. What we learn in class often really
stays in class and is rarely translated into real life, and the largest hindrance to the development of
children: the soccer mom.
The soccer mom always tries to eliminate trial and error, the antifragility, from children’s lives.
The education system lacks the right type of rigor, randomness, mess, adventures, uncertainty, self-
discovery, near-traumatic episodes, and so much more that makes life worth living!
Fat Tony Debates Socrates
Taleb says we often decide based on fragility and not on probability. For instance, it’s highly unlikely
that there would be a terrorist on any given plane, but as the consequences would be devastating,
we put up with lengthy safety control just to eliminate any possible chance.
The Nonlinear
On the Difference Between a Large Stone
Taleb gives an example of fragility with driving a car into a wall to explain nonlinear property. For
example, one crash at 100 km/h will cause much more wreckage, than 100 crashes at 1 km/h. 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). A simple example is known heuristically by weight lifters. Lifting one hundred pounds
once brings more benefits than lifting fifty pounds twice, and certainly a lot more than lifting one
pound a hundred times.
There's a reason your flight never arrives 4 hours early. But arriving 4 hours late is always possible!
Anything unexpected, any shocks, is much more likely to extend the total flying time, demonstrating
that flight schedules are fragile.
The Philosopher's Stone and It’s Inverse
If you have favourable 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.
Via Negativa
Taleb argues that the solution to many problems in life is by removing things, not adding things.
To make better decisions, Taleb says if you have more than one reason to do something, 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 require no more than a single
reason.
Time and Fragility
Technology is at its best when it is invisible. Taleb is convinced that technology is of greatest benefit
when it displaces the deleterious, unnatural, and inherently fragile preceding technology.
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.
So the longer a technology lives, the longer it can be expected to live. If a book has been in print for
forty years, you can expect it to be in print for another forty years.
He also says the imperial system makes more sense than the metrical one because it’s based on
reality. A meter doesn’t match anything, but a foot does. A pound what you can imagine holding in
your hands.
There is a class of things, typically technology, where we’re obsessed by having the newest version
of it. But for classical art, literature, works that have endured, older tends to be better. You likely
replace your phone every 2 years, but not the painting on your wall.
Medicine, Convexity, and Opacity
The author comes back to some concepts he already repeated: doctors tend to over-intervene even
when there’s no need to and we tend to try to make life too comfortable when comfort only makes us
more fragile.
The Ethics of Fragility and Antifragility
Skin in The Game: Antifragility at the Expense of Others
Skin in the game is a big thread for Antifragile and is something we've touched on in the Prologue.
But, there are two (actually three) rules for skin in the game:
Never get on a plane if the pilot is not on board
Make sure there is also a copilot
Never ask anyone for their opinion, forecast, or recommendation. Just ask them what they have, or
don’t have, in their portfolio.
For example, the Roman had the chief architects and constructors stand beneath the bridge they
had just erected. Or the leaders of ancient times used to put their own life on the line as a
consequence of their decision. Roman emperors marched with their legions and as a rule of thumb
the people with the biggest downside had the most respect and had the highest positions in society
(the “bastardization” of leadership is something also very well detailed by Simon Sinek in Leaders
Eat Last).
Today instead overpaid bankers can bankrupt a bank, or the whole system, and walk away with big
bonuses. That’s akin to transfering fragility from one party to the other so that one party becomes
antifragile at the expense of other innocent players and bystanders.
Fitting Ethics to a Profession
There is a phenomenon called the treadmill effect, similar to what we saw with neomania above. The
point isn’t that making a living in a profession is inherently bad; rather, it’s that such a person
becomes automatically suspect when dealing with public affairs, matters that involve others. 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.
A simple solution, but quite drastic: anyone who goes into public service should not be allowed
to subsequently earn more from any commercial activity than the income of the highest-paid civil
servant.
Unlinked References