Taleb is crass, pretentious, and cantankerously contrarian. But you can’t deny he has a point.
Don’t be a Fragillista
This book is, in a sense, the culmination of the all the prior works of the famed iconoclast and self-proclaimed flaneur, Nassim Nicholas Taleb. This is book number four in the Incerto series, a group of philosophical essays on uncertainty. This book ties together and generalises the work presented in Fooled by Randomness, The Black Swan, and the offshoot compilation of aphorisms, The Bed of Procrustes. Taleb himself recommends beginning the Incerto series from this book, and further reading the other books in the series for more depth and insights on the things covered here.
The premise of this book is simple - using the “The Triad” of Fragility, Robustness and Antifragility as a means of classifying complex systems, as opposed to predictive modelling and statistics.
What follows is a sprawling, passionate and sometimes unfocused application of this philosophy to pretty much everything. The book is broken down into 7 sub-books, each covering a different aspect of his philosophy on probability and its applications. Here, I am going to briefly go over the contents, but trying to summarize this work would not only be a fruitless exercise, but also a disservice to the actual book.
Book I - The Antifragile: An Introduction
This goes over the concepts of the Triad. What is the opposite of Fragile? Taleb floats the idea that English doesn’t have a word for it. Robust comes to mind, but it’s not really the opposite. Fragile things break under pressure. Robust things remain the same under pressure. Antifragile things are those that grow under pressure. Taleb introduces these ideas by the myths of Damocles, the Phoenix, and the Hydra.
Damocles is a character who appears in a (likely apocryphal) anecdote commonly referred to as “the Sword of Damocles”, an allusion to the imminent and ever-present peril faced by those in positions of power.
The Phoenix is a mythical birdie, which can never die. If you burn it, it will rise again from its ashes. Its a symbol of robustness.
Hydra, the mythical beast. If you cut its head, two more will grow in sites place. Hydra is antifragile.
We should all strive to be antifragile, ie., position ourselves to leverage positive black swans - positive asymmetries. He presents the idea that most major systems like the banking system, or giant corporates - all are extremely fragile; they expose themselves to negative black swans or negative asymmetries. Robust systems are equally exposed to asymmetry and are protected from variation.
He also extols the virtues of entrepreneurs, which obviously appealed to my sensibilities.
Book II - Modernity and the Denial of Antifragility
Here introduced, is the idea of the Procrustean Bed; overly stabilising systems by enforcing uniformity. Procrustes was a Greek mythic character who used to terrorise people by forcing them onto an iron bed. This involved stretching out shorter people and dismembering the taller folk - all to fit Procrustes’ bed. The guy was obviously a psycho, but this serves as a metaphor for this sub-book. Taleb’s thesis is that complex systems inherently love randomness. He espouses a bottom-up approach to complex systems, as opposed to a top-down enforced way of management. Here he presents the example of Switzerland, which has a very decentralised form of government based on smaller units called cantonments.
Along with this, he introduces the idea of iatrogenics (harm done due to the healer), and naive interventionism (interventionism while disregarding iatrogenics).
Taleb finally ends the book talking about how our obsession with prediction is a modern disease.
Book III - Nonpredictive view of the world
Here, Taleb introduces the world of Fragillistas - someone who causes fragility because they think they understand what is going on. Along with this, he introduces the ideas of the the fundamental asymmetry. Taleb uses the tale of Seneca the Younger, famous stoic and roman statesman, to elaborate on how to be antifragile by pushing asymmetry to be more favourable to you. Stoicism was traditionally about emotional robustness, not exactly antifragility. Seneca applied the principle of stoicism, but kept the upsides, thereby leveraging positive asymmetry, and becoming antifragile. Antifragility occurs to a source of volatility when the potential gains exceed the losses. This would mean that stressors lead to your advantage.
To convert your position to that of antifragility, he recommends the “Barbell strategy” . Wikipedia defines it as follows - “a barbell strategy is formed when a trader invests in long- and short-duration bonds, but does not invest in intermediate-duration bonds.” Taleb advocates this strategy in all of life. The basic idea is that you should never be in the middle. He illustrates this using many examples. The simplest one (To Taleb’s disgust) is the financial example - take say 90% of your investment and put it into very safe, inflation-proof assets (robust assets) and the other 10% should be dropped into maximally risky securities. What this does is exposes only 10% of your value to a miscalculation of risks (Black Swans). You are, for the most part, only exposed to the upsides, a positive asymmetry. This barbell technique remedies the problem that risks of rare events are incomputable and fragile to estimation error; here the financial barbell has a maximum known loss. This is quite the opposite of the golden mean strategy that advocates being in the middle, instead of extremes.
“For 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. A barbell can be any dual strategy composed of extremes, without the corruption of the middle — somehow they all result in favorable asymmetries.”
Taleb applies this to not only finance but day to day life. He asks to practice being 90% accountant, and 10% rockstar.
Book IV - Optionality, Technology and the Intelligence of Antifragility
Here, the idea of optionality is introduced. The idea is simple - one must have options. Never be locked into something; the more the options, the easier you can avoid negative black swans. He also proposes the notion of optionality as a substitute for intelligence. Optionality can be coupled with randomness, and some selection filter to produce intelligence. He gives the example of the work by François Jacob on optionality in nature; the body spontaneously aborts half of all embryos - its easier to leverage options than to create the perfect baby blueprint.
[ Option = asymmetry + rationality ]
The fragile has no options. Tinkering in a rational manner under the right conditions can outperform knowledge by exposing oneself to positive asymmetries.
In this sub-book, Taleb also makes his contempt for academia very clear. He hates them. He blames the for inverting the arrow of knowledge to read “academia -> practice”, and thinks that they make it look like we owe more to knowledge than practice. He calls this an epiphenomena - “a secondary mental phenomenon that is caused by and accompanies a physical phenomenon but has no causal influence itself”. He claims that the academics have fooled us into thinking they are the reason for humanity’s progress. There is of course more nuance to this argument, but the general gist is the academics are the fools, and the doers are the heroes.
Here, the very important idea of “The Green Lumber Fallacy” is presented - “mistaking the source of important or even necessary knowledge, for another less visible from the outside, less tractable one… how many things we call ‘relevant knowledge’ aren’t so much so”. Another, more mathematical way of looking at is confusing a function $f(x)$ for another function $g(x)$, a one that has a different non-linearity. This conflation is the root of many problems. As Fat Tony (a character representing anitfragility) would say, “They are not the same ting”
Another important point that is present here is the idea that things that are unintelligible are not necessarily unintelligent. He says that in real life, knowledge is no match for exposure; the decision effects supersede the logic. Taleb says the study of the payoff has been largely missed by intellectual history. Socrates, as Fat Tony would put it, was playing a sucker game.
Philosophers talk about truth and falsehood. People in life talk about payoff, exposure, and consequences (risks and rewards), hence fragility and antifragility. And sometimes philosophers and thinkers and those who study conflate Truth with risks and rewards.
Never play the sucker’s game, be a non-sucker.
Book V - The Nonlinear and the Nonlinear
Here, Taleb presents a mathematical basis for Antifragility. Here, there are a few things that are introduced, non-linear functions ($f(x)$ changes in a manner not proportional to x). Taleb’s talks about how the failure of most economic models are linked to the effects of the convexity effects (second-order effects).
Fragility is linked to concavity (negative convexity) which equals dislike of randomness. Taleb posits that having a larger corporation only exacerbates the effects of a negative black swan. The Agency problem - the divergence between the agent and her client - aggravates the non-linearities (convexities and asymmetries). Doubt is cast on the effectiveness of these giant corporate mergers.
The final important concept here is the Jensen’s Inequality - the basis of Antifragility and its effects. It is generally stated in the following form:
if I have a convex function $f(x)$ and there is a spread of possible x’s, then [ avg(f(x)) >= f(avg(x)) ]
The difference between the two is what’s called the Jensen Gap, this is what gives us the edge in positive convexity offered by antifragility. The convexity bias allows us to be wrong more often in a random setting. Someone with a linear payoff would have to be right way more often to get the same payoff as compared to having convexity bias on your side. On the other hand, the mirror of this is fragility, caused by negative convex bias (or concavity bias).
Book VI - Via Negative
Via Negative, in theology is defining something indirectly by figuring out what it’s not. Taleb uses this methodology in lots of fields, and further illustrate the pitfalls of modern iatorgenics (harm due to intervention).
Taleb is against neomania - the love of modernity, for the sake of it. This, he claims is a fragilistic view. A better way to see the future is by employing the lindy effect. It states that “A technology, or anything nonperishable, increases in life expectancy with every day of its life.” Taleb goes onto use many examples, from architecture to cooking, to illustrate his point.
Another major focus of this sub-book is effects of convexity and opaque heuristics in medicine. It’s unfair to say he hates medicine, but he really disliked most of medicine (He clarifies that he hates alternative medicine even more). He argues that most of our medical intervention is unnecessary, and is built on a foundation of addition of things. More drugs, more surgeries, more everything. He defines a couple of principles for medical iatrogenics:
- The first principle of iatrogenics is that we do not need evidence of harm to claim that a drug, or an unnatural via positiva procedure is dangerous.
- The second principle is that we should not take risks with near-healthy people; but we should take a lot more risk with those deemed in danger. This is an application of the barbell strategy to hedge the convexity effects.
Taleb takes many examples from medicine to drive his point home, and how jensen’s inequality also applies to medicine.
Taleb is in love with the ancients, and here too, he extols the virtues of ancient traditions and ways of life, or opaque heuristics - heuristics performed by society for a long time, for reasons not fully understood, yet they have stuck. He talks about the convexity effects of varied nutrition, along with the advantage of fasting being an opaque heuristic passed on from thousands of years. There is much more discussion about medicine and health, and how it benefits from stressors, much like hormesis (“Hormesis is defined by toxicologists to describe a biphasic dose response to an environmental agent with a low-dose stimulation showing beneficial effects and a high-dose stimulation showing inhibitory or toxic effects.”)
Book VII - The Ethics of Fragility and Antifragility.
The final sub-book covers the concept of having skin in the game and all the ethical ramifications of antifragility. Taleb considers having skin in the game to be extremely important as those who don’t have any skin the game (nothing to lose) attain optionality and antifragility at the expense of others. This transfer of symmetry is unethical in Taleb’s view (and I can’t really disagree.) A major problem that leads to unethical optionality is the Agency problem as described earlier - it absolves one from having skin in the game.
There are some more thoughts on the ethics of various professions and how they can exercise optionality at the cost of others. An example of this is an academic, who can keep churning out papers until they have arrived at the desired results. Taleb also says that big data is heightening the issue of bad research due to spurious correlations leading to increased cherry-picking. The main point Taleb is putting forth is that Science must not be a competition, and knowledge should not too have an Agency problem.
Take the ten with a grain of salt - my real review
So, this is the first 10 I have ever given out. I was wavering between a 9 and 10 for this one but finally settled on a 10. This book was a joy to read, even though I didn’t feel fully convinced by some of his arguments, one can’t deny that Taleb is a smart man who definitely has a point to make.
The reason I gave this a 10 was that its definitely changed the way I look at things. It made me think, and it will continue to make me think. I am going to change my lifestyle, and strive to be more antifragile. While, I am definitely going to verify Mr Taleb’s medical advice, its something that has opened up my mind to the other side - iatrogenics and jensen’s inequality in medicine. It makes sense, but I am still going to verify.
This is a book I am definitely going to reread, the first that I think I would. Its dense, and enjoyable. The 300th page is as entertaining and insightful (if not more) as the 100th.
Nobody loves Taleb like Taleb loves Taleb.
The books writing style is a dichotomy between the thoughts of an erudite man and the tweets of a salty internet dweller. Taleb hates economists. He names and shames so many people. Fragillista Friedman, Uberfragilitsa Greenspan, unethical Alan Blinder - the list goes on and on. While he comes off as salty, reading his tirades against the “Harvard-Soviet” folk, and the world of fragilistas is very entertaining. I actually laughed out loud on multiple occasions while reading this book. I can see how this can get a bit much for some, but drama spices up everything.
Taleb being so pompous in a sense adds to the character of the book. There is not an ounce of humility, unlike in his friend Kahneman’s magnum opus, “Thinking, Fast and Slow”. He is definitely one of the most interesting thinkers I have read. He has a way with words and can repackage, distil and build upon great ideas of past mathematicians and philosophers while presenting it in a wildly entertaining package. For challenging my mindset, and entertaining me so much in the process, this book deserves a 10.