#11 The Nassim Taleb & Incerto Podcast
How can we expect to predict a future of unlimited possibilities based off the finite experience of our past?
This is the problem of the Black Swan. We imagine our lives in linear terms but yesterdays tomorrow rarely looks like today.
As we know the Black Swan has three key characteristics.
- They are an extreme event. 9/11, 2004 Indonesian Tsunami.
- They have an extreme impact. Global Financial Crisis, the Spanish Colonisation of Latin America, the invention of Penicillin.
- They are only explicable after the fact. The election of Donald Trump, the catalyst of WW1 (28/7-1914).
How are we expected to know the properties of what is infinite and unknown – the future – based off the evidence of what is finite and known – the past?
So since we have no idea where the Black Swan will come from, what the Black Swan will look like, or even when the Black Swan will strike, how on earth can we hope to survive it?
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Cheers for reading through to the end you legend!
Every month (or couple of weeks) I write a short, popular email which highlights the biggest insights I’ve distilled through all the noise of the previous month. This includes extremely cool ideas, exceptional companies, massive stories that weren’t given attention, the music and podcasts that defined that month plus of course the best-written content I came across.
How To Survive The Black Swan
Nassim Taleb quite reductively instructs us to ‘go to parties’. Brilliant advice, yes, but too simplified. Nassim means to maximise your chance at experiencing the upside of a Black Swan, you need to reap the upside and downside of multiple random experiences.
- Expose yourself too many different experiences.
- Learn whatever you can.
- Don’t burn bridges.
- Follow your own tastes.
- Keep 90% of your wealth in the safest, lowest risk vehicle available, and frivolously spend the rest on high risk pursuits.
- Have your ideas and knowledge tested.
- Ultimately – Do more failing, do less averaging, stress the body and the mind.
The most important takeaway from this is to acknowledge the existence of Black Swans. Acknowledge that we live in Extremistan, and there is – by definition – no way in predicting when the next Black Swan will occur. The only way to profit and not die from the Black Swan is to become Antifragile.
So go to parties, get your finances in order and do more, because another Black Swan is around the corner, and who knows what it will be?
How To Survive The Black Swan Apple Podcast
How To Survive The Black Swan Youtube
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Cheers for reading through to the end you legend!
Every month (or couple of weeks) I write a short, popular email which highlights the biggest insights I’ve distilled through all the noise of the previous month. This includes extremely cool ideas, exceptional companies, massive stories that weren’t given attention, the music and podcasts that defined that month plus of course the best-written content I came across.
