Our hero
Posted on 03/01/2020 4:34:51 AM PST by Bon mots
after this, you’ll welcome obstacles
“The general principle of antifragility, it is much better to do things you cannot explain than explain things you cannot do.” – Nassim Taleb
“Being an entrepreneur is an existential, not just a financial thing.” – Nassim Taleb
“They have turned the wolf into a dog and man himself into the man’s best domesticated animal.” – Friedrich Nietzsche
The ideas in this post have been the most transformative in my life over the last couple years. I avoided writing about them because I didn’t feel I could. Finally, I feel that I’ve internalized, tested, and understand them deeply enough to communicate them with you.
This is a long post, but it could change your life and outlook in massive ways. I can say that without arrogance because these ideas aren’t my own, they’re Taleb’s.
Nassim Nicholas Taleb warned the world about the 2008 financial crisis before it happened. He didn’t predict it, per say, he just evaluated the financial system and saw how fragile it was.
The world is slowly beginning to admit how terrible we are at predicting the future. Stumbling on Happiness showed us that we can’t even predict what will make us happy in the future.
“Your mistake was not in imagining things you could not know—that is, after all, what imagination is for. Rather, your mistake was in unthinkingly treating what you imagined as though it were an accurate representation of the facts.” ― Daniel Gilbert, Stumbling on Happiness
I am going to do my best to share a new lens of the world with you and convince how powerful it can be in your life. This isn’t about wishful thinking or small self-help lifehacks. This is about looking at reality as the mess it is and learning to benefit from the chaos.
I’m not going to attempt to summarize Taleb’s books, it would be blasphemy. Almost all business books I read I feel fine sharing a summary, synthesis, and some quotes. That’s all they deserve. Taleb’s work is different. Reading his work, especially Incerto (containing The Bed of Procrustes, Fooled by Randomness, The Black Swan, and Antifragile) is an experience. This post will provide a powerful perspective shift and tools that you can begin using immediately. It will not replace the books in any way.
I’ve written skimmable articles before, this is not one of them. This stuff is too important to skim. I hope you take the time to read the whole thing. If you can’t read it now then skim it and bookmark it for later.
Here is an overview of what we’re going to be getting into:
Our goal is presented by Taleb in the Prologue of Antifragile:
I want to live happily in a world I don’t understand.
We think we need to know what’s going to happen to be ready for it. We think we need to have a perfectly clear vision of what we want our future to be if we want to avoid being homeless. We believe experts when they bullshit us and themselves with comforting predictions that are ultimately worse than useless – they convince us that we can know the unknowable.
It took me a long time to accept that I can’t know what’s going to happen in life. It can be paralyzing to realize that what you’re doing might not work, that the economy is changing so fast you won’t be able to keep up, and that, no matter how well things are going, the shit will inevitably hit the fan.
Taleb opens Antifragile with the following:
Wind extinguishes a candle and energizes fire.
Likewise with randomness, uncertainty, chaos: you want to use them, not hide from them. You want to be the fire and wish for the wind. …
The mission is how to domesticate, even dominate, even conquer, the unseen, the opaque, and the inexplicable.
How?
Let’s find out.
Our hero
[Note 1: All quotes without a name attached are Taleb.]
[Note 2: There are some complex ideas here, if you don’t understand something then keep reading – the next paragraph may explain it.]→ → → MORE >>>
Every word I posted is important, especially the words after "unless".
I invite everyone to view a 5 year weekly chart of TVIX - stockcharts.com or wherever. TVIX has reverse split many times. On March 2, 2015 the split-adjusted opening price was about 520,000. It has massive decay built into it's structure and should be thoroughly understood before speculating or "investing".
Thank you again for the great post.
Bon mots, you seriously cannot be that dense. Look at any Yager or MLM “training” course. Mandatory books and tapes just like this where the “independent” business “owner” has to spend thousands to listen to this drivel to get motivated to spend thousands more on an elusive and illusory quest for more dollars that won’t materialize without tricking others into the scam.
I’m not saying investing in commodities is a scam. But the linked site is a not-so-thinly veiled infomercial for this dude’s books and tapes on “investments” or maybe his own investments scams. And you posted it under News. Again, seriously? Does FR even allow infomercials on our dime?
Great post? It’s an INFOMERCIAL! GTFO!
I try to be diplomatic at times.
Good idea.
Great post? It appears to be merely an advertisement for the chap’s investment materials disguised and an opinion piece. I suggest reconsideration of your position.
:-)
*as an opinion piece
This is not an infomercial - I don't make a dime from sharing this info.
ETFs are not commodities.
Perhaps the site I linked is not the best, I was trying to find something to explain the concept of AntiFragile...
Anyway, invest wisely. Don't buy any tapes or books, just look at the concept of AntiFragility.
That too.
The night last week that the CDC came out with their announcement about the spread of the virus, I went out and bought more.
Mrs. L and I could seal up our doors and windows and go 30 days.
L
I'm playing with SEP IRA money as half of it belongs to the IRS if I take it out now... as well as the fact that I'm in the middle of a divorce, so it is all at risk now anyway. LoL
I did good already with SPXS, but how high can it go?
The TVIX is really risky. But we are not in normal times. It's times like these that you can either lose your 401K or double it.
I went into the market on Monday looking to short and buy puts on Carnival as the cruise business is DEAD and will not come back for a long time.
Another thing to consider is the fact that downside events happen quickly and are over quickly - if they're big. They come along once in a decade... like right NOW.
For a stock to go from 100-50 is pretty fast and easy - look at Carnival. A fall of 50%.
Now, for it to go from 50 back to 100, it needs to gain 100%.
If you can figure out how to play it, the odds are better on the downside - the entire world is running with its hair on fire, it's the apocalypse... meanwhile, the world is still turning.
Anyway, what do you think of the SPXS? I see it as the safest of the unsafe or the unsafest of the safe... :)
Monday is going to be very interesting indeed...
After re-reading, I regret this particular link, but there is not a lot out there on anti-fragility.
I wanted my FReeper friends to be aware of this... at least those that are interested.
This is a time you can lose your 401K or double it. Pay attention to the comments and not the link.
I wish I had a blog, I could have done a better writeup on AntiFragility and the benefits of having not only awareness of the concept but of how to act upon it in times of turmoil such as these.
What's happening in the markets is a once-in-a-decade event. That much is already clear and this thing did not even really get started.
Already we are witnessing the collapse of the cruise ship industry, airlines have ground to a halt, supply chains are drying up, truckers and shippers are idle or going idle and only one very unhealthy person died in the USA so far...
There are a few people infected on the West Coast - no big deal, except that we have no idea how they got infected... no connection to China, Iran, Italy and they were out and about circulating... they are not the only ones.
This genie is not going back into the bottle.
My reason for posting is to alert my fellow Freepers to what is happening and perhaps shine a light on some things that may be financially beneficial to them. This crisis is not going away any time soon and in times of turmoil, it's good to share some ideas with your friends.
I tried to follow the link and for a second I could see your page, but then some big white screen filled in the top and wouldn’t let me scroll down.
Oh. Never mind, it loaded on my 2nd try.
My points:
Corona Virus
It's a Black Swan Event. These come along once in a decade or more. This is such a 'thing'.
How can I position myself to weather this storm financially?
Understand:
1.) Fragile;
2.) Robust;
3.) Anti-Fragile
I just wanted to discuss some AntiFragile ideas with folks who think like me.
I'm long SPXS... hold my beer... :)
“My question is: What are some of the AntiFragile positions you think will be best for investors during this current panic and black swan event?”
If you truly do not know what’s going to happen, what’s going to go up and what’s going to go down, your best bet is diversification.
If you have some solid rational reasons based on past similar events that some asset classes may do better than others then I would tilt my investment more toward that, while still not betting the farm on it.
Seems like you’re not following the advice of the article. You’re assuming that you know what’s going to happen, whereas the article advises just the opposite.
“Rather, your mistake was in unthinkingly treating what you imagined as though it were an accurate representation of the facts.”
It will continue to go up as long as the S&P500 goes down. I don't pretend to know what any market will do in the future.
I currently hold positions that profit when the stock markets go down. I have stop loss orders in place to exit me when they start to move back up, whenever that may be.
I guess I trade in an anti-fragile manner ... no predictions, just prepared to handle whatever happens ...
Not exactly, anti-fragile is not the same as tough or robust.
For example, working out with weights puts stress on the muscles, but ends us strengthening them in the long run.
A vaccine can be considered an anti-fragile tool because it forces the human body to deal with the Corona virus in a small dose, and therefore strengthens the immune system.
An entrepreneur is a business where all sorts of stress and mistakes are made (hopefully on a small scale) with the idea that the risk-taker learns and is more immune to business ups and downs in the future now that he or she learns how to deal with tough situations.
Statements like that are fragile, not anti-fragile ...
should be thoroughly understood before speculating or “investing”.
speculating and investing are not the same. This is clearly speculating, don’t confuse people, they don’t see the quotes.
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