Notebook for Antifragile: Things That Gain from Disorder (Incerto) Taleb, Nassim Nicholas Citation (APA): Taleb, N. N. (2012). Antifragile: Things That Gain from Disorder (Incerto) [Kindle Android version]. Retrieved from Amazon.com Prologue Highlight (yellow) - Page 3 Antifragility is beyond resilience or robustness. The resilient resists shocks and stays the same; the antifragile gets better. Highlight (yellow) - Page 5 anything that has more upside than downside from random events (or certain shocks) is antifragile; the reverse is fragile. Highlight (yellow) - Page 6 Thou shalt not have antifragility at the expense of the fragility of others. Highlight (yellow) - Page 8 Given the unattainability of perfect robustness, we need a mechanism by which the system regenerates itself continuously by using, rather than suffering from, random events, unpredictable shocks, stressors, and volatility. Note - Page 8 Is antifragility possible for artificial intelligence systems? A machine that learns to find meaning from random events to decrease its cost function somehow. That begs the question of the cost function, it has to either be more fluid or more abstract for this to happen. Highlight (yellow) - Page 8 Engineers and tinkerers develop things while history books are written by academics; Highlight (yellow) - Page 9 Soviet- Harvard delusion, the (unscientific) overestimation of the reach of scientific knowledge. Highlight (yellow) - Page 11 Less is more and usually more effective. Highlight (yellow) - Page 11 Heuristics are simplified rules of thumb that make things simple and easy to implement. But their main advantage is that the user knows that they are not perfect, just expedient, and is therefore less fooled by their powers. They become dangerous when we forget that. Highlight (yellow) - Page 11 I suddenly realized one day that fragility— which had been lacking a technical definition— could be expressed as what does not like volatility, and that what does not like volatility does not like randomness, uncertainty, disorder, errors, stressors, etc. Highlight (yellow) - Page 12 antifragility flows— sort of— from this explicit definition of fragility. It likes volatility et al. It also likes time. And there is a powerful and helpful link to nonlinearity: everything nonlinear in response is either fragile or antifragile to a certain source of randomness. Highlight (yellow) - Page 15 If you see fraud and do not say fraud, you are a fraud. Just as being nice to the arrogant is no better than being arrogant toward the nice, being accommodating toward anyone committing a nefarious action condones it. Highlight (yellow) - Page 16 George Santayana: A man is morally free when… he judges the world, and judges other men, with uncompromising sincerity. Appendix: The Triad, or A Map of the World and Things Along the Three Properties Highlight (yellow) - Page 21 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. Book I: The Antifragile: An Introduction Highlight (yellow) - Chapter 1. Between Damocles and Hydra > Page 34 Hydra, in Greek mythology, is a serpent- like creature that dwells in the lake of Lerna, near Argos, and has numerous heads. Each time one is cut off, two grow back. So harm is what it likes. Hydra represents antifragility. Highlight (yellow) - Chapter 2. Overcompensation and Overreaction Everywhere > Page 41 post- traumatic growth, the opposite of post- traumatic stress syndrome, by which people harmed by past events surpass themselves. Highlight (yellow) - Chapter 2. Overcompensation and Overreaction Everywhere > Page 41 How do you innovate? First, try to get in trouble. I mean serious, but not terminal, trouble. I hold— it is beyond speculation, rather a conviction— that innovation and sophistication spark from initial situations of necessity, in ways that go far beyond the satisfaction of such necessity (from the unintended side effects of, say, an initial invention or attempt at invention). Highlight (yellow) - Chapter 2. Overcompensation and Overreaction Everywhere > Page 42 Latin saying that sophistication is born out of hunger (artificia docuit fames). The idea pervades classical literature: in Ovid, difficulty is what wakes up the genius (ingenium mala saepe movent), which translates in Brooklyn English into “When life gives you a lemon…” Highlight (yellow) - Chapter 2. Overcompensation and Overreaction Everywhere > Page 42 The excess energy released from overreaction to setbacks is what innovates! Highlight (yellow) - Chapter 2. Overcompensation and Overreaction Everywhere > Page 42 innovation comes from bureaucratic funding, through planning, or by putting people through a Harvard Business School class by one Highly Decorated Professor of Innovation and Entrepreneurship (who never innovated anything) or hiring a consultant (who never innovated anything). This is a fallacy— note for now the disproportionate contribution of uneducated technicians and entrepreneurs to various technological leaps, from the Industrial Revolution to the emergence of Silicon Valley, and you will see what I mean. Highlight (yellow) - Chapter 2. Overcompensation and Overreaction Everywhere > Page 42 The record shows that, for society, the richer we become, the harder it gets to live within our means. Abundance is harder for us to handle than scarcity. Note - Chapter 2. Overcompensation and Overreaction Everywhere > Page 43 Maybe this can be offset by self x paternalism, where a dynamic percent of savings are automatically deducted and put into stocks / savings account. This can create artificial scarcity but with increased security. Then maybe the saved up funds can be used to kick-start your own ventures. Highlight (yellow) - Chapter 2. Overcompensation and Overreaction Everywhere > Page 43 Undercompensation from the absence of a stressor, inverse hormesis, absence of challenge, degrades the best of the best. Note - Chapter 2. Overcompensation and Overreaction Everywhere > Page 43 So this just means to always do hard things. Challenge yourself and get out of comfort zone. If you don't feel stressed, find ways to create commitments which will force that stress. Highlight (yellow) - Chapter 2. Overcompensation and Overreaction Everywhere > Page 43 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. Highlight (yellow) - Chapter 2. Overcompensation and Overreaction Everywhere > Page 43 I learned that the noise produced by the person is inverse to the pecking order: as with mafia dons, the most powerful traders were the least audible. Highlight (yellow) - Chapter 2. Overcompensation and Overreaction Everywhere > Page 43 One should have enough self- control to make the audience work hard to listen, which causes them to switch into intellectual overdrive. Note - Chapter 2. Overcompensation and Overreaction Everywhere > Page 43 Not sure about this. But perhaps temper your enthusiasm while speaking. Be passionate but controlled. Speak with better pause and cadence. Highlight (yellow) - Chapter 2. Overcompensation and Overreaction Everywhere > Page 44 there is empirical evidence of the effect of “disfluency.” Mental effort moves us into higher gear, activating more vigorous and more analytical brain machinery. Highlight (yellow) - Chapter 2. Overcompensation and Overreaction Everywhere > Page 44 Layers of redundancy are the central risk management property of natural systems. Highlight (yellow) - Chapter 2. Overcompensation and Overreaction Everywhere > Page 44 we have a historical track record of engaging in debt, which is the opposite of redundancy (fifty thousand in extra cash in the bank or, better, under the mattress, is redundancy; owing the bank an equivalent amount, that is, debt, is the opposite of redundancy). Redundancy is ambiguous because it seems like a waste if nothing unusual happens. Except that something unusual happens— usually. Highlight (yellow) - Chapter 2. Overcompensation and Overreaction Everywhere > Page 46 Lucretius problem, after the Latin poetic philosopher who wrote that the fool believes that the tallest mountain in the world will be equal to the tallest one he has observed. Highlight (yellow) - Chapter 2. Overcompensation and Overreaction Everywhere > Page 48 “Repeated punishment, while it crushes the hatred of a few, stirs the hatred of all… just as trees that have been trimmed throw out again countless branches.” Highlight (yellow) - Chapter 2. Overcompensation and Overreaction Everywhere > Page 49 the more energy you put into trying to control your ideas and what you think about, the more your ideas end up controlling you. Note - Chapter 2. Overcompensation and Overreaction Everywhere > Page 49 That's why meditation is the answer. Not repressing your thoughts but allowing yourself to think/feel them and letting them pass without judgment. Highlight (yellow) - Chapter 2. Overcompensation and Overreaction Everywhere > Page 49 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 them. Highlight (yellow) - Chapter 2. Overcompensation and Overreaction Everywhere > Page 52 With few exceptions, those who dress outrageously are robust or even antifragile in reputation; those clean- shaven types who dress in suits and ties are fragile to information about them. Highlight (yellow) - Chapter 2. Overcompensation and Overreaction Everywhere > Page 53 Just as in matters of seduction, people lend the most to those who need them the least. Highlight (yellow) - Chapter 4. What Kills Me Makes Others Stronger > Page 65 The fragility of every startup is necessary for the economy to be antifragile, and that’s what makes, among other things, entrepreneurship work: the fragility of individual entrepreneurs and their necessarily high failure rate. Highlight (yellow) - Chapter 4. What Kills Me Makes Others Stronger > Page 71 When you want deviations, and you don’t care about the possible dispersion of outcomes that the future can bring, since most will be helpful, you are antifragile. Further, the random element in trial and error is not quite random, if it is carried out rationally, using error as a source of information. If every trial provides you with information about what does not work, you start zooming in on a solution— so every attempt becomes more valuable, more like an expense than an error. And of course you make discoveries along the way. Highlight (yellow) - Chapter 4. What Kills Me Makes Others Stronger > Page 74 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. Highlight (yellow) - Chapter 4. What Kills Me Makes Others Stronger > Page 74 He who has never sinned is less reliable than he who has only sinned once. And someone who has made plenty of errors— though never the same error more than once— is more reliable than someone who has never made any. Highlight (yellow) - Chapter 4. What Kills Me Makes Others Stronger > Page 80 National Entrepreneur Day, with the following message: Most of you will fail, disrespected, impoverished, but we are grateful for the risks you are taking and the sacrifices you are making for the sake of the economic growth of the planet and pulling others out of poverty. You are at the source of our antifragility. Our nation thanks you. Book II: Modernity and the Denial of Antifragility Highlight (yellow) - Chapter 5. The Souk and the Office Building > Page 84 This is the central illusion in life: that randomness is risky, that it is a bad thing— and that eliminating randomness is done by eliminating randomness. Highlight (yellow) - Chapter 5. The Souk and the Office Building > Page 88 The way people handle local affairs is vastly different from the way they handle large, abstract public expenditures: we have traditionally lived in small units and tribes and managed rather well in small units. Highlight (yellow) - Chapter 5. The Souk and the Office Building > Page 89 “Stalin could not have existed in a municipality.” Note - Chapter 5. The Souk and the Office Building > Page 89 Of course, this is a negative example but does this hold true for greatness also? Can greatness be accomplished in a municipality? Perhaps not, and that's why people correctly dream to move to the big city. Highlight (yellow) - Chapter 5. The Souk and the Office Building > Page 89 The problem is that by creating bureaucracies, we put civil servants in a position to make decisions based on abstract and theoretical matters, with the illusion that they will be making them in a rational, accountable way. Highlight (yellow) - Chapter 6. Tell Them I Love (Some) Randomness > Page 102 The idea of injecting random noise into a system to improve its functioning has been applied across fields. By a mechanism called stochastic resonance, adding random noise to the background makes you hear the sounds (say, music) with more accuracy. Highlight (yellow) - Chapter 7. Naive Intervention > Page 114 People with an engineering- oriented mind will tend to look at everything around as an engineering problem. This is a very good thing in engineering, but when dealing with cats, it is a much better idea to hire veterinarians than circuits engineers— or even better, let your animal heal by itself. Highlight (yellow) - Chapter 7. Naive Intervention > Page 123 Since procrastination is a message from our natural willpower via low motivation, the cure is changing the environment, or one’s profession, by selecting one in which one does not have to fight one’s impulses. Highlight (yellow) - Chapter 7. Naive Intervention > Page 123 Actually I select the writing of the passages of this book by means of procrastination. If I defer writing a section, it must be eliminated. This is simple ethics: Why should I try to fool people by writing about a subject for which I feel no natural drive? Highlight (yellow) - Chapter 7. Naive Intervention > Page 126 The more frequently you look at data, the more noise you are disproportionally likely to get Highlight (yellow) - Chapter 7. Naive Intervention > Page 126 anyone who listens to news (except when very, very significant events take place) is one step below sucker. Highlight (yellow) - Chapter 7. Naive Intervention > Page 127 The best solution is to only look at very large changes in data or conditions, never at small ones. Just as we are not likely to mistake a bear for a stone (but likely to mistake a stone for a bear), it is almost impossible for someone rational, with a clear, uninfected mind, someone who is not drowning in data, to mistake a vital signal, one that matters for his survival, for noise— unless he is overanxious, oversensitive, and neurotic, hence distracted and confused by other messages. Significant signals have a way to reach you. Highlight (yellow) - Chapter 8. Prediction as a Child of Modernity > Page 135 There are ample empirical findings to the effect that providing someone with a random numerical forecast increases his risk taking, even if the person knows the projections are random. Highlight (yellow) - Chapter 8. Prediction as a Child of Modernity > Page 140 What are the Quadrants? Combining exposures and types of randomness we get four combinations: Mediocristan randomness, low exposure to extreme events (First Quadrant); Mediocristan randomness, high exposure to extreme events (Second Quadrant); Extremistan randomness, low exposure to extreme events (Third Quadrant); Extremistan randomness, high exposure to extreme events (Fourth Quadrant). The first three quadrants are ones in which knowledge or lack of it bring inconsequential errors. “Robustification” is the modification of exposures to make a switch from the fourth to the third quadrant. Book III: A Nonpredictive View of the World Highlight (yellow) - Chapter 9. Fat Tony and the Fragilistas > Page 147 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. Highlight (yellow) - Chapter 10. Seneca’s Upside and Downside > Page 152 wisdom in decision making is vastly more important— not just practically, but philosophically— than knowledge. Highlight (yellow) - Chapter 10. Seneca’s Upside and Downside > Page 152 To become a successful philosopher king, it is much better to start as a king than as a philosopher, Note - Chapter 10. Seneca’s Upside and Downside > Page 152 This means practice first, then theory. So fool around with libraries and APIs first and then study formally to augment your practice. Highlight (yellow) - Chapter 10. Seneca’s Upside and Downside > Page 153 the key phrase reverberating in Seneca’s oeuvre is nihil perditi, “I lost nothing,” after an adverse event. Highlight (yellow) - Chapter 10. Seneca’s Upside and Downside > Page 154 Success brings an asymmetry: you now have a lot more to lose than to gain. You are hence fragile. Highlight (yellow) - Chapter 11. Never Marry the Rock Star > Page 160 if something is fragile, its risk of breaking makes anything you do to improve it or make it “efficient” inconsequential unless you first reduce that risk of breaking. Highlight (yellow) - Chapter 11. Never Marry the Rock Star > Page 161 antifragility is the combination aggressiveness plus paranoia— clip your downside, protect yourself from extreme harm, and let the upside, the positive Black Swans, take care of itself. We saw Seneca’s asymmetry: more upside than downside can come simply from the reduction of extreme downside (emotional harm) rather than improving things in the middle. Highlight (yellow) - Chapter 11. Never Marry the Rock Star > Page 164 professions can be serial: something very safe, then something speculative. Highlight (yellow) - Chapter 11. Never Marry the Rock Star > Page 165 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. Highlight (yellow) - Chapter 11. Never Marry the Rock Star > Page 165 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. Note - Chapter 11. Never Marry the Rock Star > Page 165 So short periods of deep work and scheduled leisure or random periods. This can probably be worked into a hyperproductive morning schedule, and then afternoon and evenings left for experiencing life and randomness which augments the deep work period. The key, I think, is consistency of the deep work period. It is possible to get a lot done in only a few hours should attention be 100% there. Highlight (yellow) - Chapter 11. Never Marry the Rock Star > Page 165 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. Highlight (yellow) - Chapter 11. Never Marry the Rock Star > Page 166 More barbells. Do crazy things (break furniture once in a while), like the Greeks during the later stages of a drinking symposium, and stay “rational” in larger decisions. Trashy gossip magazines and classics or sophisticated works; never middlebrow stuff. Talk to either undergraduate students, cab drivers, and gardeners or the highest caliber scholars; never to middling- but- career- conscious academics. If you dislike someone, leave him alone or eliminate him; don’t attack him verbally. 2 Book IV: Optionality, Technology, and The Intelligence of Antifragility Highlight (yellow) - Do You Really Know Where You Are Going? > Page 169 Summa Theologiae by Saint Thomas Aquinas Note - Do You Really Know Where You Are Going? > Page 169 Summa Theologiae by Saint Thomas Aquinas Highlight (yellow) - Do You Really Know Where You Are Going? > Page 170 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. Highlight (yellow) - Do You Really Know Where You Are Going? > Page 170 The rational flâneur is someone who, unlike a tourist, makes a decision at every step to revise his schedule, so he can imbibe things based on new information, what Nero was trying to practice in his travels, often guided by his sense of smell. The flâneur is not a prisoner of a plan. Tourism, actual or figurative, is imbued with the teleological illusion; it assumes completeness of vision and gets one locked into a hard- to- revise program, while the flâneur continuously— and, what is crucial, rationally— modifies his targets as he acquires information. Highlight (yellow) - Do You Really Know Where You Are Going? > Page 170 Now a warning: the opportunism of the flâneur is great in life and business— but not in personal life and matters that involve others. The opposite of opportunism in human relations is loyalty, a noble sentiment— but one that needs to be invested in the right places, that is, in human relations and moral commitments. Highlight (yellow) - Do You Really Know Where You Are Going? > Page 172 Like Britain in the Industrial Revolution, America’s asset is, simply, risk taking and the use of optionality, this remarkable ability to engage in rational forms of trial and error, with no comparative shame in failing, starting again, and repeating failure. In modern Japan, by contrast, shame comes with failure, which causes people to hide risks under the rug, financial or nuclear, making small benefits while sitting on dynamite, an attitude that strangely contrasts with their traditional respect for fallen heroes and the so- called nobility of failure. Highlight (yellow) - Chapter 12. Thales’ Sweet Grapes > Page 174 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. Highlight (yellow) - Chapter 12. Thales’ Sweet Grapes > Page 176 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. Note - Chapter 12. Thales’ Sweet Grapes > Page 176 Ouch. It's common to make excuses that "it's not just your thing" for things you're bad at (but secretly want to be good at) Highlight (yellow) - Chapter 12. Thales’ Sweet Grapes > Page 181 Bricolage is a form of trial and error close to tweaking, trying to make do with what you’ve got by recycling pieces that would be otherwise wasted. Highlight (yellow) - Chapter 12. Thales’ Sweet Grapes > Page 181 Steve Jobs at a famous speech: “Stay hungry, stay foolish.” He probably meant “Be crazy but retain the rationality of choosing the upper bound when you see it.” Highlight (yellow) - Chapter 12. Thales’ Sweet Grapes > Page 183 In trial and error, the rationality consists in not rejecting something that is markedly better than what you had before. Highlight (yellow) - Chapter 13. Lecturing Birds on How to Fly > Page 189 Just as great geniuses invent their predecessors, practical innovations create their theoretical ancestry. Note - Chapter 13. Lecturing Birds on How to Fly > Page 189 Takeaway from the chapter so far: for a lot of innovations, the technology had been ripe for a long time already. It just took someone to put 2 and 2 together. So the deeper takeaway is: it's good to look at the inventions of the past and see if there are ways to tweak them and make them applicable in the current context. Highlight (yellow) - Chapter 13. Lecturing Birds on How to Fly > Page 190 both governments and universities have done very, very little for innovation and discovery, precisely because, in addition to their blinding rationalism, they look for the complicated, the lurid, the newsworthy, the narrated, the scientistic, and the grandiose, rarely for the wheel on the suitcase. Simplicity, I realized, does not lead to laurels. Highlight (yellow) - Chapter 13. Lecturing Birds on How to Fly > Page 192 In many pursuits, every trial, every failure provides additional information, each more valuable than the previous one— Highlight (yellow) - Chapter 13. Lecturing Birds on How to Fly > Page 193 looking for a treasure in your house: every search has incrementally a higher probability of yielding a result, but only if you can be certain that the area you have searched does not hold the treasure. Highlight (yellow) - Chapter 13. Lecturing Birds on How to Fly > Page 197 The Soviet- Harvard illusion (lecturing birds on flying and believing that the lecture is the cause of these wonderful skills) belongs to a class of causal illusions called epiphenomena. What are these illusions? When you spend time on the bridge of a ship or in the coxswain’s station with a large compass in front, you can easily develop the impression that the compass is directing the ship rather than merely reflecting its direction. Highlight (yellow) - Chapter 14. When Two Things Are Not the “Same Thing” > Page 204 Serious empirical investigation (largely thanks to one Lant Pritchet, then a World Bank economist) shows no evidence that raising the general level of education raises income at the level of a country. Note - Chapter 14. When Two Things Are Not the “Same Thing” > Page 204 This is really, really interesting if true. We have to confirm this!! Highlight (yellow) - Chapter 14. When Two Things Are Not the “Same Thing” > Page 205 Education stabilizes the income of families across generations. A merchant makes money, then his children go to the Sorbonne, they become doctors and magistrates. The family retains wealth because the diplomas allow members to remain in the middle class long after the ancestral wealth is depleted. But these effects don’t count for countries. Highlight (yellow) - Chapter 14. When Two Things Are Not the “Same Thing” > Page 205 (parties are great for optionality). Highlight (yellow) - Chapter 14. When Two Things Are Not the “Same Thing” > Page 206 halo effect, the mistake of thinking that skills in, say, skiing translate unfailingly into skills in managing a pottery workshop or a bank department, or that a good chess player would be a good strategist in real life). Highlight (yellow) - Chapter 14. When Two Things Are Not the “Same Thing” > Page 211 People with too much smoke and complicated tricks and methods in their brains start missing elementary, very elementary things. Highlight (yellow) - Chapter 14. When Two Things Are Not the “Same Thing” > Page 211 the more studies, the less obvious elementary but fundamental things become; activity, on the other hand, strips things to their simplest possible model. Highlight (yellow) - Chapter 14. When Two Things Are Not the “Same Thing” > Page 213 You make forays into the future by opportunism and optionality. Note - Chapter 14. When Two Things Are Not the “Same Thing” > Page 213 Again, it's course correcting given new data. Perhaps not being overly attached to ends but having one nonetheless. Highlight (yellow) - Chapter 14. When Two Things Are Not the “Same Thing” > Page 213 As Yogi Berra said, “In theory there is no difference between theory and practice; in practice there is.” Highlight (yellow) - Chapter 14. When Two Things Are Not the “Same Thing” > Page 215 Accordingly, wisdom you learn from your grandmother should be vastly superior (empirically, hence scientifically) to what you get from a class in business school (and, of course, considerably cheaper). My sadness is that we have been moving farther and farther away from grandmothers. Note - Chapter 14. When Two Things Are Not the “Same Thing” > Page 215 Thus supporting my urge to hear stories from older people and learn from their experience and mistakes. I should always remember to feed this urge. Highlight (yellow) - Chapter 15. History Written by the Losers > Page 226 An extraordinary proportion of work came out of the rector, the English parish priest with no worries, erudition, a large or at least comfortable house, domestic help, a reliable supply of tea and scones with clotted cream, and an abundance of free time. And, of course, optionality. Highlight (yellow) - Chapter 15. History Written by the Losers > Page 228 The Industrial Revolution, for a refresher, came from “technologists building technology,” or what he calls “hobby science.” Take again the steam engine, the one artifact that more than anything else embodies the Industrial Revolution. As we saw, we had a blueprint of how to build it from Hero of Alexandria. Yet the theory didn’t interest anyone for about two millennia. So practice and rediscovery had to be the cause of the interest in Hero’s blueprint, not the other way around. Note - Chapter 15. History Written by the Losers > Page 228 Postulate: a good innovation process would be to first define a problem deeply, form a hypothesis of how to solve, look at the gaps in your knowledge (what do I need to learn to solve the problem?), look for old greats who attempted to solve the problem, learn, build a prototype and iterate while learning on the fly. Highlight (yellow) - Chapter 15. History Written by the Losers > Page 229 Consider blue sky research, whereby research grants and funding are given to people, not projects, and spread in small amounts across many researchers. Note - Chapter 15. History Written by the Losers > Page 229 You could consider YC as providing blue sky research grants. Highlight (yellow) - Chapter 15. History Written by the Losers > Page 229 you bet on the jockey, not the horse. Why? Because innovations drift, and one needs flâneur- like abilities to keep capturing the opportunities that arise, not stay locked up in a bureaucratic mold. Note - Chapter 15. History Written by the Losers > Page 230 Same as dad's argument to "keep your ear to the ground". Random thought: I wonder if before I was too obsessed with optionality and having that plus the tyranny of choice I was paralyzed. Maybe it's good to bring that optionality back but make firmer decisions and of course trying one's best to not hassle people. Have a bit of "loyalty". Highlight (yellow) - Chapter 15. History Written by the Losers > Page 230 Visibly the money should go to the tinkerers, the aggressive tinkerers who you trust will milk the option. Highlight (yellow) - Chapter 15. History Written by the Losers > Page 230 Consequently, payoff from research should necessarily be linear to number of trials, not total funds involved in the trials. Since, as in Figure 7, the winner will have an explosive payoff, uncapped, the right approach requires a certain style of blind funding. It means the right policy would be what is called “one divided by n” or “1/ N” style, spreading attempts in as large a number of trials as possible: if you face n options, invest in all of them in equal amounts. Note - Chapter 15. History Written by the Losers > Page 230 Maybe this is how to invest in crypto. Listen for signals on new coins and invest a little on each. Set a threshold and sell once it reaches that amount without regrets even if it continues to go up. Highlight (yellow) - Chapter 15. History Written by the Losers > Page 230 Small amounts per trial, lots of trials, broader than you want. Why? Because in Extremistan, it is more important to be in something in a small amount than to miss it. As one venture capitalist told me: “The payoff can be so large that you can’t afford not to be in everything.” Highlight (yellow) - Chapter 15. History Written by the Losers > Page 233 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. Highlight (yellow) - Chapter 15. History Written by the Losers > Page 233 philosopher’s stone. Note - Chapter 15. History Written by the Losers > Page 233 From Quora: The idea is to evaluate systems (any system—governments, investment ideas, lifestyle choices, scientific investigations, ecologies—anything) not by the probabilities of good or bad payoffs, but by whether the best case benefits are bigger or smaller than the worst case losses. If the losses are bigger, the system is fragile. If the payoffs are roughly equal, the system is robust. If the benefits are bigger, the system is antifragile. Picking up nickels in front of a steamroller is fragile. The best case benefit is $0.05, the worst case loss is getting flattened. Taking a short-cut to avoid traffic is robust. In the best case you save some time, in the worst case you lose some time. Striking up a conversation with an interesting looking stranger is antifragile. In the best case you could make a valuable connection or friend for life, in the worst case you’ll get brushed off or have a few minutes of boredom. Highlight (yellow) - Chapter 15. History Written by the Losers > Page 237 “bounded left” (limited losses, like Thales’ bet) and “bounded right” (limited gains, like insurance or banking). The distinction is crucial, as most payoffs in life fall in either one or the other category. Highlight (yellow) - Chapter 15. History Written by the Losers > Page 238 (i) Look for optionality; in fact, rank things according to optionality, (ii) preferably with open- ended, not closed- ended, payoffs; (iii) Do not invest in business plans but in people, so look for someone capable of changing six or seven times over his career, or more (an idea that is part of the modus operandi of the venture capitalist Marc Andreessen); one gets immunity from the backfit narratives of the business plan by investing in people. It is simply more robust to do so; (iv) Make sure you are barbelled, whatever that means in your business. Highlight (yellow) - Chapter 16. A Lesson in Disorder > Page 242 soccer moms try to eliminate the trial and error, the antifragility, from children’s lives, move them away from the ecological and transform them into nerds working on preexisting (soccer- mom- compatible) maps of reality. Good students, but nerds— that is, they are like computers except slower. Further, they are now totally untrained to handle ambiguity. Highlight (yellow) - Chapter 16. A Lesson in Disorder > Page 242 Only the autodidacts are free. And not just in school matters— those who decommoditize, detouristify their lives. Highlight (yellow) - Chapter 16. A Lesson in Disorder > Page 248 what I was given to study in school I have forgotten; what I decided to read on my own, I still remember. Highlight (yellow) - Chapter 17. Fat Tony Debates Socrates > Page 255 “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. Highlight (yellow) - Chapter 17. Fat Tony Debates Socrates > Page 256 Nietzsche understood something that I did not find explicitly stated in his work: that growth in knowledge— or in anything— cannot proceed without the Dionysian. Highlight (yellow) - Chapter 17. Fat Tony Debates Socrates > Page 259 The payoff, what happens to you (the benefits or harm from it), is always the most important thing, not the event itself. Highlight (yellow) - Chapter 17. Fat Tony Debates Socrates > Page 261 To conclude this section, note that doing is wiser than you are prone to believe— and more rational. What I did here is just debunk the Lecturing- Birds- How- to- Fly epiphenomenon and the “linear model,” using among other things the simple mathematical properties of optionality, which does not require knowledge or intelligence, merely rationality in choice. Highlight (yellow) - Chapter 17. Fat Tony Debates Socrates > Page 261 Remember that there is no empirical evidence to support the statement that organized research in the sense it is currently marketed leads to the great things promised by universities. Highlight (yellow) - Chapter 17. Fat Tony Debates Socrates > Page 261 Ivy League universities becoming in the eyes of the new Asian and U.S. upper class a status luxury good. Harvard is like a Vuitton bag or a Cartier watch. It is a huge drag on the middle- class parents who have been plowing an increased share of their savings into these institutions, transferring their money to administrators, real estate developers, professors, and other agents. Book V: The Nonlinear and The Nonlinear Highlight (yellow) - Chapter 18. On the Difference Between a Large Stone and a Thousand Pebbles > Page 268 For the fragile, shocks bring higher harm as their intensity increases (up to a certain level). Highlight (yellow) - Chapter 18. On the Difference Between a Large Stone and a Thousand Pebbles > Page 271 For the fragile, the cumulative effect of small shocks is smaller than the single effect of an equivalent single large shock. Highlight (yellow) - Chapter 18. On the Difference Between a Large Stone and a Thousand Pebbles > Page 271 For the antifragile, shocks bring more benefits (equivalently, less harm) as their intensity increases (up to a point). Highlight (yellow) - Chapter 18. On the Difference Between a Large Stone and a Thousand Pebbles > Page 272 Figure 12 also shows why the convex likes volatility. If you earn more than you lose from fluctuations, you want a lot of fluctuations. Note - Chapter 18. On the Difference Between a Large Stone and a Thousand Pebbles > Page 273 A graph follows in the book. Highlight (yellow) - Chapter 18. On the Difference Between a Large Stone and a Thousand Pebbles > Page 276 Another intuitive way to look at convexity effects: consider the scaling property. If you double the exposure to something, do you more than double the harm it will cause? If so, then this is a situation of fragility. Otherwise, you are robust. Highlight (yellow) - Chapter 18. On the Difference Between a Large Stone and a Thousand Pebbles > Page 276 Just look at how different the large stone is from the pebbles: the latter have the same weight and the same general shape, but that’s about it. Likewise, we saw in Chapter 5 that a city is not a large village; a corporation is not a larger small business. Highlight (yellow) - Chapter 18. On the Difference Between a Large Stone and a Thousand Pebbles > Page 279 In spite of what is studied in business schools concerning “economies of scale,” size hurts you at times of stress; it is not a good idea to be large during difficult times. Highlight (yellow) - Chapter 18. On the Difference Between a Large Stone and a Thousand Pebbles > Page 280 Large animals are more fragile to shocks than small ones— again, stone and pebbles. Jared Diamond, always ahead of others, figured out such vulnerability in a paper called “Why Cats Have Nine Lives.” If you throw a cat or a mouse from an elevation of several times their height, they will typically manage to survive. Elephants, by comparison, break limbs very easily. Note - Chapter 18. On the Difference Between a Large Stone and a Thousand Pebbles > Page 280 An argument to stay trim. Especially if you have weak joints. Highlight (yellow) - Chapter 19. The Philosopher’s Stone and Its Inverse > Page 291 a move upward in an economic variable led to massive losses, a move downward (in the opposite direction), to small profits. Further moves upward led to even larger additional losses and further moves downward to even smaller profits. It looked exactly like the story of the stone in Figure 9. Acceleration of harm was obvious— in fact it was monstrous. Note - Chapter 19. The Philosopher’s Stone and Its Inverse > Page 291 Fragility Highlight (yellow) - Chapter 19. The Philosopher’s Stone and Its Inverse > Page 295 Do not cross a river if it is on average four feet deep. Highlight (yellow) - Chapter 19. The Philosopher’s Stone and Its Inverse > Page 295 The notion of average is of no significance when one is fragile to variations— Highlight (yellow) - Chapter 19. The Philosopher’s Stone and Its Inverse > Page 299 The hidden benefit of antifragility is that you can guess worse than random and still end up outperforming. Highlight (yellow) - Chapter 19. The Philosopher’s Stone and Its Inverse > Page 299 you can be dumb and antifragile and still do very well. Highlight (yellow) - Chapter 19. The Philosopher’s Stone and Its Inverse > Page 299 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. Book VI: Via Negativa Highlight (yellow) - Chapter 19. The Philosopher’s Stone and Its Inverse > Page 302 Michelangelo was asked by the pope about the secret of his genius, particularly how he carved the statue of David, largely considered the masterpiece of all masterpieces. His answer was: “It’s simple. I just remove everything that is not David.” The reader might thus recognize the logic behind the barbell. Remember from the logic of the barbell that it is necessary to first remove fragilities. Highlight (yellow) - Subtractive Knowledge > Page 303 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. Highlight (yellow) - Subtractive Knowledge > Page 303 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. Highlight (yellow) - Subtractive Knowledge > Page 304 Let us say that, in general, failure (and disconfirmation) are more informative than success and confirmation, which is why I claim that negative knowledge is just “more robust.” Note - Subtractive Knowledge > Page 304 Sorta related too, in neural networks we learn precisely more (or only) from error than success. Highlight (yellow) - Subtractive Knowledge > Page 305 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. Highlight (yellow) - Subtractive Knowledge > Page 305 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.” Note - Subtractive Knowledge > Page 305 Please please do remember this. Highlight (yellow) - Barbells, Again > Page 305 The less- is- more idea in decision making can be traced to Spyros Makridakis, Robyn Dawes, Dan Goldstein, and Gerd Gigerenzer, who have all found in various contexts that simpler methods for forecasting and inference can work much, much better than complicated ones. Note - Barbells, Again > Page 305 Just like what Kahneman says in Thinking Fast and Slow Highlight (yellow) - Barbells, Again > Page 306 Almost everything contemporary has winner- take- all effects, which includes sources of harm and benefits. Highlight (yellow) - Barbells, Again > Page 308 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. Highlight (yellow) - Barbells, Again > Page 308 Bergson’s razor: “A philosopher should be known for one single idea, not more” Highlight (yellow) - Chapter 20. Time and Fragility > Page 314 Technothinkers tend to have an “engineering mind”— to put it less politely, they have autistic tendencies. While they don’t usually wear ties, these types tend, of course, to exhibit all the textbook characteristics of nerdiness— mostly lack of charm, interest in objects instead of persons, causing them to neglect their looks. They love precision at the expense of applicability. And they typically share an absence of literary culture. Highlight (yellow) - Chapter 20. Time and Fragility > Page 314 This absence of literary culture is actually a marker of future blindness because it is usually accompanied by a denigration of history, a byproduct of unconditional neomania. Outside of the niche and isolated genre of science fiction, literature is about the past. We do not learn physics or biology from medieval textbooks, but we still read Homer, Plato, or the very modern Shakespeare. We cannot talk about sculpture without knowledge of the works of Phidias, Michelangelo, or the great Canova. These are in the past, not in the future. Just by setting foot into a museum, the aesthetically minded person is connecting with the elders. Whether overtly or not, he will tend to acquire and respect historical knowledge, even if it is to reject it. And the past— properly handled, as we will see in the next section— is a much better teacher about the properties of the future than the present. To understand the future, you do not need technoautistic jargon, obsession with “killer apps,” these sort of things. You just need the following: some respect for the past, some curiosity about the historical record, a hunger for the wisdom of the elders, and a grasp of the notion of “heuristics,” these often unwritten rules of thumb that are so determining of survival. In other words, you will be forced to give weight to things that have been around, things that have survived. Highlight (yellow) - Chapter 20. Time and Fragility > Page 320 Much progress comes from the young because of their relative freedom from the system and courage to take action that older people lose as they become trapped in life. But it is precisely the young who propose ideas that are fragile, not because they are young, but because most unseasoned ideas are fragile. Highlight (yellow) - Chapter 20. Time and Fragility > Page 320 The future is in the past. Actually there is an Arabic proverb to that effect: he who does not have a past has no future. Note - Chapter 20. Time and Fragility > Page 320 A stark reminder to read the classics. Highlight (yellow) - Chapter 20. Time and Fragility > Page 321 we confuse the necessary and the causal: because all surviving technologies have some obvious benefits, we are led to believe that all technologies offering obvious benefits will survive. Highlight (yellow) - Chapter 21. Medicine, Convexity, and Opacity > Page 339 The first principle of iatrogenics is as follows: we do not need evidence of harm to claim that a drug or an unnatural via positiva procedure is dangerous. Highlight (yellow) - Chapter 21. Medicine, Convexity, and Opacity > Page 341 Once in a while we come up with drugs that enhance performance, such as, say, steroids, only to discover what people in finance have known for a while: in a “mature” market there is no free lunch anymore, and what appears as a free lunch has a hidden risk. When you think you have found a free lunch, say, steroids or trans fat, something that helps the healthy without visible downside, it is most likely that there is a concealed trap somewhere. Actually, my days in trading, it was called a “sucker’s trade.” Highlight (yellow) - Chapter 21. Medicine, Convexity, and Opacity > Page 341 there is a simple statistical reason that explains why we have not been able to find drugs that make us feel unconditionally better when we are well (or unconditionally stronger, etc.): nature would have been likely to find this magic pill by itself. But consider that illness is rare, and the more ill the person the less likely nature would have found the solution by itself, in an accelerating way. A condition that is, say, three units of deviation away from the norm is more than three hundred times rarer than normal; an illness that is five units of deviation from the norm is more than a million times rarer! Highlight (yellow) - Chapter 21. Medicine, Convexity, and Opacity > Page 342 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. Highlight (yellow) - Chapter 21. Medicine, Convexity, and Opacity > Page 347 if the person is very ill, there are no iatrogenics to worry about. So it is the marginal case that brings dangers. Highlight (yellow) - Chapter 21. Medicine, Convexity, and Opacity > Page 349 what Mother Nature does is rigorous until proven otherwise; what humans and science do is flawed until proven otherwise. Highlight (yellow) - Chapter 21. Medicine, Convexity, and Opacity > Page 349 If you want to talk about the “statistically significant,” nothing on the planet can be as close to “statistically significant” as nature. This is in deference to her track record and the sheer statistical significance of her massively large experience— the way she has managed to survive Black Swan events. Highlight (yellow) - Chapter 22. To Live Long, but Not Too Long > Page 363 this idea of shedding possessions to go to the desert can be quite potent as a via negativa– style subtractive strategy. Note - Chapter 22. To Live Long, but Not Too Long > Page 363 Maybe this is also what travel does. Shows you who you are by via negativa. Highlight (yellow) - Chapter 22. To Live Long, but Not Too Long > Page 364 If true wealth consists in worriless sleeping, clear conscience, reciprocal gratitude, absence of envy, good appetite, muscle strength, physical energy, frequent laughs, no meals alone, no gym class, some physical labor (or hobby), good bowel movements, no meeting rooms, and periodic surprises, then it is largely subtractive (elimination of iatrogenics). Highlight (yellow) - Chapter 22. To Live Long, but Not Too Long > Page 364 Religion has invisible purposes beyond what the literal- minded scientistic- scientifiers identify— one of which is to protect us from scientism, that is, them. Highlight (yellow) - Chapter 22. To Live Long, but Not Too Long > Page 366 speculate; in fact I more than speculate: I am convinced (an inevitable result of nonlinearity) that we are antifragile to randomness in food delivery and composition— at least over a certain range, or number of days. Highlight (yellow) - Chapter 22. To Live Long, but Not Too Long > Page 369 Scientists use the narrative that starvation causes the expression of a gene coding a protein called SIRT, SIRT1, or sirtuin, which brings longevity and other effects. The antifragility of humans manifests itself in the response with up- regulation of some genes in response to hunger. Book VII: The Ethics of Fragility and Antifragility Highlight (yellow) - Chapter 23. Skin in the Game: Antifragility and Optionality at the Expense of Others > Page 378 courage and heroism do not mean blind risk taking— it is not necessarily recklessness. There is a pseudocourage that comes from risk blindness, in which people underestimate the odds of failure. We have ample evidence that the very same people become chicken and overreact in the face of real risks; the exact opposite. Highlight (yellow) - Chapter 23. Skin in the Game: Antifragility and Optionality at the Expense of Others > Page 380 A lesson I learned from this ancient culture is the notion of megalopsychon (a term expressed in Aristotle’s ethics), a sense of grandeur that was superseded by the Christian value of “humility.” There is no word for it in Romance languages; in Arabic it is called Shhm— best translated as nonsmall. If you take risks and face your fate with dignity, there is nothing you can do that makes you small; if you don’t take risks, there is nothing you can do that makes you grand, nothing. And when you take risks, insults by half- men (small men, those who don’t risk anything) are similar to barks by nonhuman animals: you can’t feel insulted by a dog. Highlight (yellow) - Chapter 23. Skin in the Game: Antifragility and Optionality at the Expense of Others > Page 381 Predicting— any prediction— without skin in the game can be as dangerous for others as unmanned nuclear plants without the engineer sleeping on the premises. Pilots should be on the plane. Highlight (yellow) - Chapter 23. Skin in the Game: Antifragility and Optionality at the Expense of Others > Page 384 Natural and ancestral systems work by penalties: no perpetual free option given to anyone. Highlight (yellow) - Chapter 23. Skin in the Game: Antifragility and Optionality at the Expense of Others > Page 385 The asymmetry (antifragility of postdictors): postdictors can cherry- pick and produce instances in which their opinions played out and discard mispredictions into the bowels of history. It is like a free option— to them; we pay for it. Highlight (yellow) - Chapter 23. Skin in the Game: Antifragility and Optionality at the Expense of Others > Page 389 Never ask anyone for their opinion, forecast, or recommendation. Just ask them what they have— or don’t have— in their portfolio. Highlight (yellow) - Chapter 23. Skin in the Game: Antifragility and Optionality at the Expense of Others > Page 389 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. Highlight (yellow) - Chapter 23. Skin in the Game: Antifragility and Optionality at the Expense of Others > Page 392 The Romans removed the soldiers’ incentive to be a coward and hurt others thanks to a process called decimation. If a legion loses a battle and there is suspicion of cowardice, 10 percent of the soldiers and commanders are put to death, usually by random lottery. Decimation— meaning eliminating one in ten— has been corrupted by modern language. The magic number is one in ten (or something equivalent): putting more than 10 per cent to death would lead to weakening of the army; too little, and cowardice would be a dominant strategy. Highlight (yellow) - Chapter 23. Skin in the Game: Antifragility and Optionality at the Expense of Others > Page 393 On April 29, 711, the armies of the Arab commander Tarek crossed the Strait of Gibraltar from Morocco into Spain with a small army (the name Gibraltar is derived from the Arabic Jabal Tarek, meaning “mount of Tarek”). Upon landing, Tarek had his ships put to the fire. He then made a famous speech every schoolchild memorized during my school days that I translate loosely: “Behind you is the sea, before you, the enemy. You are vastly outnumbered. All you have is sword and courage.” Highlight (yellow) - Chapter 23. Skin in the Game: Antifragility and Optionality at the Expense of Others > Page 395 Never listen to a leftist who does not give away his fortune or does not live the exact lifestyle he wants others to follow. What the French call “the caviar left,” la gauche caviar, or what Anglo- Saxons call champagne socialists, are people who advocate socialism, sometimes even communism, or some political system with sumptuary limitations, while overtly leading a lavish lifestyle, often financed by inheritance— not realizing the contradiction that they want others to avoid just such a lifestyle. Highlight (yellow) - Chapter 23. Skin in the Game: Antifragility and Optionality at the Expense of Others > Page 396 There is a class of people who escape bureaucrato- journalistic “tawk”: those who have more than their skin in the game. They have their soul in the game. Highlight (yellow) - Chapter 23. Skin in the Game: Antifragility and Optionality at the Expense of Others > Page 396 there is one step beyond needed to reach the rank of prophet. It is a matter of commitment, or what philosophers call doxastic commitment, a type of belief- pledge that to Fat Tony and Nero needed to be translated into deeds (the reverse- Stiglitz). Doxa in Greek used to mean “belief,” but distinguished from “knowledge” (episteme); to see how it involves a commitment of sorts beyond just words, consider that in church Greek it took the meaning of glorification. Incidentally, this notion also applies to all manner of ideas and theories: the main person behind a theory, the person to be called the originator, is someone who believed in it, in a doxastic way, with a costly commitment to take it to its natural conclusion; and not necessarily the first person to mention it over dessert wine or in a footnote. Only he who has true beliefs will avoid eventually contradicting himself and falling into the errors of postdicting. Highlight (yellow) - Chapter 23. Skin in the Game: Antifragility and Optionality at the Expense of Others > Page 405 never trust the words of a man who is not free. Highlight (yellow) - Chapter 24. Fitting Ethics to a Profession > Page 408 “But, Neeroh Toolip, there are still slaves around,” Fat Tony blurted out. “They often distinguish themselves by wearing this intricate device called a necktie.” Nero: “Signore Ingeniere Tony, some of these tie- wearers are very rich, even richer than you.” Tony: “Nero, you sucker. Don’t be fooled by money. These are just numbers. Being self- owned is a state of mind.” Highlight (yellow) - Chapter 24. Fitting Ethics to a Profession > Page 408 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. Highlight (yellow) - Chapter 24. Fitting Ethics to a Profession > Page 410 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. Highlight (yellow) - Chapter 24. Fitting Ethics to a Profession > Page 411 only he who has courage is free with his opinion. Highlight (yellow) - Chapter 24. Fitting Ethics to a Profession > Page 415 If someone has an opinion, like, say, the banking system is fragile and should collapse, I want him invested in it so he is harmed if the audience for his opinion are harmed— as a token that he is not an empty suit. But when general statements about the collective welfare are made, instead, absence of investment is what is required. Via negativa. Highlight (yellow) - Chapter 25. Conclusion > Page 421 A central argument is never a summary— it is more like a generator. Highlight (yellow) - Chapter 25. Conclusion > Page 421 Everything gains or loses from volatility. Fragility is what loses from volatility and uncertainty. Highlight (yellow) - Chapter 25. Conclusion > Page 422 Time is volatility. Education, in the sense of the formation of character, personality, and acquisition of true knowledge, likes disorder; label- driven education and educators abhor disorder. Some things break because of error, others don’t. Some theories fall apart, not others. Innovation is precisely something that gains from uncertainty: and some people sit around waiting for uncertainty and using it as raw material, just like our ancestral hunters. Highlight (yellow) - Chapter 25. Conclusion > Page 422 Ethics is largely about stolen convexities and optionality. Highlight (yellow) - Chapter 25. Conclusion > Page 422 More technically, we may never get to know x, but we can play with the exposure to x, barbell things to defang them; we can control a function of x, f( x), even if x remains vastly beyond our understanding. We can keep changing f( x) until we are comfortable with it by a mechanism called convex transformation, the fancier name for the barbell. Highlight (yellow) - Chapter 25. Conclusion > Page 424 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. Glossary Highlight (yellow) - Chapter 25. Conclusion > Location 7420 Rational flâneur (or just flâneur): Someone who, unlike a tourist, makes a decision opportunistically at every step to revise his schedule (or his destination) so he can imbibe things based on new information obtained. In research and entrepreneurship, being a flâneur is called “looking for optionality.” A non- narrative approach to life. Highlight (yellow) - Chapter 25. Conclusion > Location 7442 Burden of evidence: The burden of evidence falls on those who disrupt the natural, or those who propose via positiva policies. Highlight (yellow) - Chapter 25. Conclusion > Location 7445 Antifragile Tinkering, Bricolage: A certain class of trial and error, with small errors being “the right” kind of mistakes. All equivalent to rational flâneur. Highlight (yellow) - Chapter 25. Conclusion > Location 7447 Hormesis: A bit of a harmful substance, or stressor, in the right dose or with the right intensity, stimulates the organism and makes it better, stronger, healthier, and prepared for a stronger dose the next exposure. (Think of bones and karate.) Highlight (yellow) - Chapter 25. Conclusion > Location 7458 Doxastic Commitment, or “Soul in the Game”: You must only believe predictions and opinions by those who committed themselves to a certain belief, and had something to lose, in a way to pay a cost in being wrong. Highlight (yellow) - Chapter 25. Conclusion > Location 7462 Opaque Heuristic: Routine performed by societies that does not seem to make sense yet has been done for a long time and sticks for unknown reasons. Highlight (yellow) - Chapter 25. Conclusion > Location 7466 Agency Problem: Situation in which the manager of a business is not the true owner, so he follows a strategy that cosmetically seems to be sound, but in a hidden way benefits him and makes him antifragile at the expense (fragility) of the true owners or society. When he is right, he collects large benefits; when he is wrong, others pay the price. Typically this problem leads to fragility, as it is easy to hide risks. It also affects politicians and academics. A major source of fragility. Highlight (yellow) - Chapter 25. Conclusion > Location 7472 Green Lumber Fallacy: Mistaking the source of important or even necessary knowledge— the greenness of lumber— for another, less visible from the outside, less tractable one. How theoreticians impute wrong weights to what one should know in a certain business or, more generally, how many things we call “relevant knowledge” aren’t so much so. Highlight (yellow) - Chapter 25. Conclusion > Location 7480 Ethical Problems as Transfers of Asymmetry (fragility): Someone steals antifragility and optionality from others, getting the upside and sticking others with the downside. “Others’ skin in the game.” Highlight (yellow) - Chapter 25. Conclusion > Location 7491 Rational Optionality: Not being locked into a given program, so one can change his mind as he goes along based on discovery or new information. Also applies to rational flâneur. Highlight (yellow) - Chapter 25. Conclusion > Location 7505 Subtractive Knowledge: You know what is wrong with more certainty than you know anything else. An application of via negativa. Via negativa: In theology and philosophy, the focus on what something is not, an indirect definition. In action, it is a recipe for what to avoid, what not to do— subtraction, not addition, say, in medicine. Note - Chapter 25. Conclusion > Location 7508 I wonder if neural nets work by via negativa. Or if that's why generally we learn more from failure (with explicit feedback) than success. Highlight (yellow) - Chapter 25. Conclusion > Location 7510 Lindy Effect: A technology, or anything nonperishable, increases in life expectancy with every day of its life— unlike perishable items (such as humans, cats, dogs, and tomatoes). So a book that has been a hundred years in print is likely to stay in print another hundred years. Highlight (yellow) - Chapter 25. Conclusion > Location 7516 Mediocristan: A process dominated by the mediocre, with few extreme successes or failures (say, income for a dentist). No single observation can meaningfully affect the aggregate. Also called “thin- tailed,” or member of the Gaussian family of distributions. Note - Chapter 25. Conclusion > Location 7519 Note that it is gaussian. I read an article somewhere that says humans do not follow a gaussian distribution at work. It's more fat-tailed or extremistan. Highlight (yellow) - Chapter 25. Conclusion > Location 7519 Extremistan: A process where the total can be conceivably impacted by a single observation (say, income for a writer). Also called “fat- tailed.” Includes the fractal, or power- law, family of distributions.