Fragile things hate chaos, volatility and randomness. The slightest jolt can break them. But what is the opposite of fragility? Not resilience or robustness. Resilient things are neutral to stressors. They take a beating, but remain unchanged. So what likes from disorder? Our languages don't have a word for such a property, or at least they didn't, until Nassim Taleb came around.

Antifragile is the property of things that gain from disorder: like muscle, economies, creativity, and character. And today on MindMatters we delve into Taleb's book on the subject. Insightful, down to earth, witty and practical, Taleb's writing is one of a kind. Just like the man himself.

Running Time: 01:17:14

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Here's the transcript of the show:

Corey: Hey everybody. Today we are going to be discussing Nassim Taleb's book Antifragile. It's part of a whole series, an essay is the way I think he described it, on probability and how we fool ourselves into believing that we can predict the future, we can predict massive events that have a very small likelihood of ever being predicted and how as humans we can move into a realm of being able to face risks and take risks in a way that's intelligent.

The book is a social critique. It's also an extremely fascinating intellectual endeavour in that he maps out this big gap that we have a species, it seems. I think that he went through all the languages and found that no language really had a suitable antonym for fragile. In his interviews he describes how you get a box, you put glass in it. You're shipping glass to somebody overseas and you put "fragile" on it. But we don't have anything that you would put "Likes disorder" on. "Please shake this box". We don't have any word so he came up with the word and it's the title of the book, antifragile. He's also the author of the Black Swan and...

Elan: Skin in the Game.

Corey: Procrustes.

Harrison: The Bed of Procrustes.

Corey: The Bed of Procrustes, which is a lot of aphorisms, very witty and poignant. He's a very intelligent, interesting and exotic thinker.

Harrison: Also Fooled by Randomness was the first book in the series that he wrote. Fooled by Randomness then Black Swan then this one, Antifragile and then Skin in the Game. Then Bed of Procrustes was somewhere in there.

One comment on that phenomenon of language that he observes in the book, I'd just like to get a bit more into the definition. If you look at fragile, you want to avoid any stressors coming in contact with a fragile thing. So if you think about a small glass ornament, something very intricate, you want to put it in a glass case or something. You don't want kids to be around it. You don't want them to be playing with it because a small knock or a drop will break it and break it beyond repair most often.

That's what a fragile thing is. That's why you say we put 'fragile' on boxes. But what's the opposite of fragile? He points out that practically in every conversation if you ask someone who isn't already familiar with the term, they'll say that the opposite of fragile is robust or resilient, so something that will withstand shocks and not break because of them. But that's not the case because something fragile doesn't like stressors, doesn't like chaos, volatility or randomness. It wants to be shielded from those things.

But something that's robust like a rock or a steel block, those things can withstand shocks. You can take a hammer to them, oftentimes without breaking them, or their toleration of stressors is very high so it takes a lot of effort in order to destroy them. But they don't like stressors. They don't gain from those kinds of events, that kind of chaos. So the opposite of fragile is, like you said, something that gains something from a stressor. That's not what robust is. Robust is neutral.

So you've got something like fragile which is negative, it doesn't like something, and you've got neutral robust things which can go either way. You can hit them or not hit them but it doesn't matter to the robust thing. Then you've got this other category of things which actually benefits from disorder, benefits from stress and chaos to some degree. We didn't have a word for that until Taleb came along. But the point that he makes is even without a word for it, we understand it and humans have always understood it, even if they didn't have the words for it.

So along those lines he gives another example, just to give the concept of this ability to do without knowing because humans can do a lot of things without necessarily knowing why they do them or how it works. One example that he gives is the names of colours. In the typical rainbow in our culture it's got seven colours - red, orange, yellow, green, blue, indigo, violet. But he gives the example of some research that shows that there are some cultures that only have three colours for instance. Then there's the now-famous phenomenon from ancient Greek literature that shows that they didn't have a word for blue, for instance. They had a very limited range of colour words.

I think this was discovered in the 1800s by the first guy who really observed this. If you look at Homer for instance, in the Odyssey, the sea is described as the wine dark sea and there's no word for blue. There's no word for the blue sky or blue water which is very strange. There are light colours and dark colours and then a few in between like yellow or something like that. But there weren't necessarily all these different colours.

So the idea, when this was first really popularized, was that maybe human vision has evolved since then, that we couldn't actually see blue back then. We didn't have the ability to see that colour and it's only been in the last couple of thousand years that we've developed the ability to actually see blue. Well that's probably nonsense. What's actually the case is that modern cultures that only see three colours for instance, have three names for colours. That doesn't mean they can't distinguish between all the existing colours. If they have no word for blue and you show them blue or two blue things, they'll be able to match the two blue things compared to the two green things, the two orange things, whatever. It's just that they don't have the word for it. They can act it out and they can distinguish and differentiate between those but just not name them according to our seven colour convention.

For instance, I only use six colours. I never really understood indigo violent. It's like it's blue, or it's purple! I've done colour perception tests where you match up colours and I always score really high on them. I can distinguish shades of different colours but if you ask me what indigo is, I'll say, "Well show me a colour. It's either blue, or it's purple." So I've got six basically colours that I work with. I can name some shades like cyan blue for instance. But the words don't matter. They do matter in a sense, but in the practical realm they don't really matter because we can still act these things out and still recognize them.

So some of the principles of antifragility have been known as long as humans. We tend to understand that living things have this property, even though we haven't had a name for it and we act in a way that acknowledges the existence of this kind of thing, this property. We also do things totally ignorantly against this property by imposing our own beliefs about the nature of things and reality that actually produce fragility because by not recognizing things as antifragile, we actually produce fragility. We make things more at risk of falling apart.

Elan: Yes. Taleb is a financial analyst. He used to be a trader. He's a self-stylized philosopher. By the way, this is a very funny book. Taleb sprinkles a lot of his explanations with personal experience, analogies, metaphors, so this isn't a dry, intellectual exercise for him. He's really quite entertaining. But one of the things that spurred him on, like you were saying Harrison, he's seeing all of this tendency in society and culture and western thinking, inducing fragility where it's actually harmful and unnecessary.

He was at an economic conference where a forecaster was giving his predictions for the economy of I think either Japan or Korea and predicting the projections for the next five years. So Taleb, in a burst of uncontrollable anger and emotion, rushed to the stage and said to everyone, "Stop predicting things and foisting this information on people that are so reliant and vulnerable to this information that you can't possibly know with all the variables involved! And by the way, have you seen this guy's predictions for the past five years or three years? Is he a reliable source of information for past years?"

So all of this is borne out of his own authentic thinking through of the problems with the types of information that people are getting and their ability to problem solve and think forward through their own process of navigating their own issues in multiple spheres. One of his biggest focuses is in economics and business and finance. He'll look at, for instance and mention quite a number of times, the economic recession of 2008 and how everyone says, "Oh, we couldn't possibly foresee this thing coming about!" and people mistaking the causes for these types of events for their real underlying issues.

So he wants to help people. He wants people to realize that we've been inculcated with the idea that we need to be protected from the small stuff when there are much larger black swans or novel developments or revolutionary developments in the life of an individual as Jordan Peterson would say, that one can take account for in a certain number of ways. One of the points he makes early on in the book is that individuals are quite familiar with the idea of post-traumatic stress but in fact there is such a thing as post-traumatic growth, that there are stressors and events that, as Nietzsche would say, would make us stronger, it doesn't kill you, that we can make lemonade from lemons.

So that's a lot of the angle that he's coming in on and trying to impart to people who seem overly risk-adverse, overly protective of various things. The helicopter parent, for instance, would be one analogy that we could see in parenting, the overprotective parent who doesn't allow their child to learn from mistakes or get injured from time to time, where these smaller, more manageable injuries would assist someone in growing and becoming stronger and learning and possibly applying their mistake and their pain towards a much larger area in their lives where they might be vulnerable to injury.

Corey: I think this is where we have a good tie-in for previous shows on our discussion on Jordan B. Peterson's Maps of Meaning and the known and the unknown and all the different ways that our society has come to understand and map out the world and how, to a large extent, we've ruled out mythology, we've ruled out the realm of action as being a legitimate area of study and it's mostly, as he describes it, these Soviet Harvard fragilistas who think that everything can be analyzed and you can understand...

Harrison: Predicted and controlled.

Corey: Predicted and controlled. And what he has set out to do with these tomes of books, it seems, is to give a map of meaning essentially, to the rest of us living in a world where everyday all of us are bombarded by new predictions, all sorts of climate change predictions, economic collapse, viral infections. Every day something big and crazy is going to happen. As he says, we can spend our entire lives trying to predict the future with absolute certainty and that is not going to work. It's not a method that we can actually utilize. We're never going to be able to statistically prophecy the end of the universe or tomorrow even.

But what we can do is put ourselves in a position where we can measure our fragility and our antifragility in a specific scenario. So if you have more upside than downside when exposed to a certain stress, any sort of calamity, you are in a position to be antifragile. For example, you take those preppers. Let's say they have cans of food and there's this massive cataclysm and now all of a sudden they are sitting on gold essentially because this gold is now gold to them. They can eat. They can survive or whatever.

So in that situation, those individuals are antifragile. Their upside is substantially increased by their own activities. He has a number of different heuristics that you can implement in order to do that in your entire life. You can be proactive, basically, is what it is. You don't live in fear. You don't live with predictions, like, "On this day, this is going to happen" or "This is guaranteed to happen". It makes us more fragile actually, I think he would say, in order to live in such a way where you're going by people's predictions, often flawed predictions. Black swans are, by definition, unpredictable.

But those are the things that scare us the most, those big events that you know are going to occur but you can't capture them with any statistical sense of certainty. But you know that it's going to happen because it has happened in the past. You've had WWII. You've had the 2008 climate crisis. You've had cometary bombardments of the planet. You know that there are these huge events that he terms black swans, which is almost a little bit too friendly for the kind of ferocity and damage that they inflict. But that is just one aspect of his whole argument. This book really builds on all the previous books. He lays out the reasons why black swans aren't predictable and how we fool ourselves by thinking that we can predict them.

Instead, we need to start seeing the world of action. In the world of action, we humans and most biological systems, require some degree of stress and volatility in order just to survive, just to live. It's a biological fact that our bodies need stress in order to live.

Harrison: But it's a certain type of stress, right? He makes that distinction. He makes a lot of distinctions because things that are antifragile in one sense will be fragile in another. So it's really multi-layered and contextual. For instance, any individual representative of a species can be fragile in comparison to the species and the species can be antifragile in comparison to the individual because the individual is vulnerable. It can die in innumerable, horrendous ways, but that actually has an advantage at the species level or at the whole life system level.

So there are distinctions like that. When it comes to stress, there are certain kinds of stress that organisms need and then certain kinds of stress that are completely toxic. He gives the example of the whole office climate, working at this monotonous task with a bad boss and the entire city life, creates all these stresses that actually make us sick and die. But we need stressors of a different kind. He's very pro-paleo in a lot of ways. For instance, he doesn't like gyms and the reason he gives is that gyms are completely artificial. You have all these workout machines, for instance, where if you're on one of those fake bicycles or a treadmill or something, you're running or doing these repetitive movements where each one is exactly the same, whereas in nature, every step you take is different. So you're constant encountering this randomness in your environment so every step you take affects your foot, leg and body in a different way. The most natural way of working out, for instance, isn't so routine and rigid and systematized. It's more natural. You go out into the forest and you lift up a rock or a tree. You don't have barbells in the forest, for instance.

So that's one kind of stressor that is beneficial for the body. He talks about even working out when you're stressing your body, you're harming your body. You're exposing it to a stress and a threat of some sort. You're doing damage to your body and then your body in response, overcompensates. It says, "Okay, I'm going to prepare for this for the next time but I'm going to overcompensate. I'm going to push a little bit harder so that not only will I be able to handle that same stressor that I was exposed to, but I'll be able to handle a bigger stressor." So you actually grow strength in that way. You become stronger and able to conquer bigger obstacles than you could in the past.

That's one kind of stress that actually increases your performance because of that overcompensation. He gives a funny example of the poor use of prediction, for instance when designing a dam or anything to do with flooding. You have these planners that look in the past 100 years and pick the biggest flood that they had in the past 100 years and they plan for that level, not thinking that that previous flood was out of the ordinary. If the planners of that time had used the previous biggest flood, they wouldn't have been prepared for the one that was coming up. You have to prepare for more than has been experienced because, like you say, you can't predict black swans. It's not like there's this artificial limit for flooding that says, "This is the most it's ever going to flood because that's what happened 100 years ago or 200 years ago." No, that one was out of the ordinary. That's the reason it's the one that you look back on. So you have to plan for the unimaginable. Plan for the one you can't predict. So you plan for a flood of much greater proportions than has ever been experienced because chances are that's the one that, if it happens, will really set you back.

Elan: That reminds me of his point on centralization and his look at the way that Switzerland functions because what Taleb would say is that the decentralization of Switzerland that has these various regional governments, that very lightly govern, but that manage to take care of all of the considerations of a given area fairly productively, make it more or less robust and less vulnerable to the systemic issues or problems that a very centralized state would have with a very big authoritarian government that might otherwise make bad decisions that affect everybody.

So he's a strong proponent for decentralization where you have an autonomous, 'if it ain't broke, don't fix it' attitude. There are so many points that he makes. The thing is, when I was reading this book, he kept qualifying all of his ideas for what being antifragile was. Like you said Harrison, he contextualizes this idea and he applies into many spheres. Something that I really enjoyed about it was that he's beseeching his readers to get out of domain dependence or this narrow thinking. You might actually enjoy some amount of antifragility in your own life. You might unwittingly or even consciously or intuitively, understand how something works and make the best use of it, at your job or even just the economics of spending energy and being productive at home if you're at home.

But he says that these are concepts that you can apply towards any sphere of your life, towards the future, in such a way that you are less vulnerable to those black swans or events that would seek to or would somehow make you more vulnerable to certain stressors.

Corey: Right. And even in the event of a debilitating event like a negative black swan, you could possibly gain from it. But there's also positive black swans that you can hunt down and track. He has the barbell to think about. He says use the barbell strategy. There's no middle ground. You're very aggressive but you're also very paranoid. An example would be 12 or 15 years ago, let's say that you have a decent job, you are renting someplace, you can afford all your bills, you've got enough money that you can put into savings and you hear about Bitcoin.

Now if you're super aggressive at the time, like "This is going to be the cryptocurrency, blah, blah, blah" and you're in on this stuff, a friend told you about it, and if you're super aggressive but not paranoid and you're not applying the antifragile philosophy, then you invest a ton of money into it, just a ton of money, and nothing happens. It's just years and years and years and you don't see any real payoff. Your life just goes out of control. You forget your password.

But the barbell approach is to be super aggressive but also to be paranoid. So you have 90% of your savings in some very conservative spot and then you take 10% and you invest that into this very exotic thing. And if there's a massive upswing, then you are all benefit. But if there's any downside to it, then you are still robust. You're still not going to be shaken to your core and it's just a matter of course. He advises hunting, being a willing participant in life, that you're going out and you're seeking these kinds of things and you're being strategic about it and you're living life in a relatively heroic way because in one of his books he writes that if you don't have a heroic bent by your 30s, you've started to die already. {laughter}

Harrison: I want to get back to heroes just because it reminded me of a passage in this book. The example you gave of saving 90% and being risky with the 10% is an example also of skin in the game. So that's an example of a person who has their own skin in the game. They're investing their own money and taking a risk for themselves. But one of his big focuses - and pet peeves is too small a word for it - one of the things that gets his blood boilingl and you can see this on Twitter, is people who not only don't have skin in the game but have other people's skin in the game. That's one of the reasons he hates big governments and centralized governments because they're all other people's skin in the game because there's no potential bad consequence for those individuals. It's all someone else.

So in the financial world it's investing other people's money in risky endeavours and then not having to pay any consequences for losing other people's money. As a trader, whenever he saw this he didn't like it. He personally took the approach of only recommending investments that he himself was invested in and would invest in for himself so that if something bad happened, he would suffer along with the people that he had recommended these financial moves to.

So that's the thing about having skin in the game. That's a central aspect of morality or character. This is the quote that it reminded me of. He just mentions heroes because he talks about heroes in Skin in the Game too. He points out that,

"As we discovered during the financial crisis that started in 2008, these blow-up risks to others are easily concealed owing to the growing complexity of modern institutions and political affairs. While in the past, people of rank or status were those and only those who took risks, who had the downside for their actions and heroes were those who did so for the sake of others. Today the exact reverse is taking place. We are witnessing the rise of a new class of inverse heroes, that is bureaucrats, bankers, Davos-attending members of the IAND (International Association of Name Droppers) and academics with too much power and no real downside and/or accountability. They game the system while citizens pay the price.

At no point in history have so many non-risk takers, that is with no personal exposure, exerted so much control. The chief ethical rule is the following: thou shalt not have antifragility at the expense of the fragility of others."

That's one of his core ethical positions that shows itself in all of his books. I wanted to mention a bit on Taleb, like I mentioned, if you see him on Twitter. He's quite pugnacious I think. If you read his Twitter, he's constantly calling people out and swearing at them and insulting people. But the thing about him is, he's only insulting people for the most part, as far as I've been able to tell, that deserve to be called out and insulted. If you look at the people that he attacks, he doesn't like frauds, bankers - in this quote, 'bankers, bureaucrats, Monsanto, interventionists in foreign policy matters'. Most of his targets pretty much deserve it.

He's coming from a position where he's got what he calls F-you money in the sense that he's not beholding to anyone. That's a big thing about him, his definition of freedom. He points out if you're working in a corporation you don't have very much freedom. You're pretty much a slave. When you're self-employed for instance, you have a lot more freedom. He argues in this book that a cab driver has more freedom than a business executive or a CEO because they can weather certain stressors and they can quit if they come up against - it's kind of like the whistleblower mentality - if something's happening that you don't agree with, a cab driver can just quit and find another job.

Someone who's entrenched in an institution doesn't have that freedom. There's all kinds of institutional and emotional considerations that come in to prevent someone from actually taking a heroic action. So with F-you money, that's money that you can use to shield yourself from the attacks of others for your own heroic action. Unfortunately, a lot of people don't have F-you money, or if they do, don't use it for a noble purpose.

So back to Taleb, he's relentless in his vituperation {laughter} of people he sees as completely unethical and those who produce more harm for other people than they do for themselves and who actively structure their lives in order to put the harm onto other people and to avoid it for themselves. Just as an example of the kind of humorous way that he takes down people like this I want to read this paragraph.

"And for those who think that academia is quieter and an emotionally relaxing transition after the volatile and risk-taking business life, a surprise. When in action, new problems and scares emerge every day to displace and eliminate the previous day's headaches, resentments and conflicts. A nail displaces another nail with astonishing variety. But academics, particularly in social science, seem to distrust each other. They live in petty obsessions-envy and icy cold hatreds with small snubs developing into grudges, fossilized over time in the loneliness of the transaction with the computer screen and the immutability of their environment, not to mention a level of envy I have almost never seen in business.

My experience is that money and transactions purify relations. Ideas and abstract matters like recognition and credit warp them, creating an atmosphere of perpetual rivalry. I grew to find people greedy for credentials nauseating, repulsive and untrustworthy. Commerce, business, Levantine souqs, though not large-scale markets and corporations, are activities and places that bring out the best in people, making most of them forgiving, honest, loving, trusting and open-minded. As a member of the Christian minority in the near east, I can vouch that commerce, particularly small commerce, is the door to tolerance, the only door in my opinion, to any form of tolerance. It beats rationalizations and lectures. Like antifragile tinkering, mistakes are small and rapidly forgotten."

So that is again, an encapsulation of this idea of decentralization and the scale of systems. I quoted him on a different show when he was talking about political systems. He's all about scale. So things that will work on one scale won't work on other scales. He often says, for instance, that for President he votes Libertarian, state level he votes republican, county level he votes democrat and then city level, he votes socialist and then in his family he's communist.

There are things that work on certain levels that don't work on higher levels, like I just said. So for the village-based community, it's very decentralized to have a close-knit community or village and then to give that as much independence as possible because that's where things work. That's where the people are that you actually interact with. When you're so far away from a distant central authority, that central authority has no familiarity with you. There's no connection. It's a totally distant relationship. So what does that person, group or institution know about your community, your village? And what will they actually do for you? Well chances are not very much.

That's kind of what history shows. Big central governments don't really care much about the tiny villages. They're doing their own thing with their own purposes and it's the people who are actually living in the village who are concerned about their local concerns. In a monarchist system, it would be the people that appeal to the king to get the central government to do something for them. But the king was a person acting on behalf of the little people. But you don't get that very often in central governments. And the central government necessitates that kind of system because it's not decentralized. If you just cut that out of the equation - I think he'd prefer going back to the Greek system of independent city states to have it as local and manageable as possible and then to interact with other city states on that level.

Incidentally, that's kind of what he's arguing for in the recent Lebanon crisis because he's Lebanese so he's been talking with a lot of people in Lebanon and acknowledging how idiotic their system has been and how much of a pain in the ass the central government has been in Lebanon and how little good they've done and how much massive fraud, corruption, mismanagement, incompetence and ineptitude they're responsible for. That's just a little bit about Taleb himself and how he applies it.

One other thing he talks about in the book is that everything he writes about and he makes it a point to do this, is that everything he writes about is something that has come from his personal experience. For example he says he'd be guilty if he were to have to go to the library and do research to make a point in the book because that would be false. All the things he writes about are things that he was actually interested in. So he doesn't need to go and find the source for it.

That's what really annoys me about academic work. When you're reading academic books you can tell that these people are doing it, the way they write and the way they set up their footnotes. This is how Alan Dershowitz did it. There was a scandal back in the day when he wrote one of his books and then found a manuscript where he's telling his research assistants, "Find the source for this and discover how you could support this point". Academics do that all the time.

Corey: Yeah.

Harrison: They have a point and then think, "I'm going to look through the research literature and see if there's something here I can use to support my point". It's pretty pathetic I think, whereas at least a guy like Taleb has some individuality and skin in the game.

If you're interested in something, you learn it because you are interested in learning it and it becomes part of you. Then you can speak about it from yourself, especially if it's from experience and that's what comes out of it. You can see it in the result because he is a character, right? He's not like anyone else. He's one of those few people in - I don't know if you'd call it the academic world because I don't think he'd like being considered an academic - but in the realm of thinkers he's one of those few that actually have their own individuality and you can tell it by reading him. He's got his own style and it's not only interesting and enlightening, it's actually entertaining to read as well and that's because of the way he writes and because of the principles that guide him in his writing.

Corey: Right. He is really scathing in his rebuke of a lot of academics and I think a lot of it is because of that fraudulent element that you're discussing, this amount of hubris and self-serving entitlement that goes into a lot of these big-wig academics because clearly he admires intellectuals. He admires the intellect. He just doesn't like fraud. One example that he provides is of this financial guru, some economist at Yale who wrote all of these arcane texts about probability and statistics and how to hedge your bets and all of this stuff. He had this opportunity to take a different job at Harvard. He didn't know what to do and one of his colleagues said, "Well why don't you just use all of the statistics and everything that you've been using for years to predict all these different things?" Then the guy said, "Hey, come on now! This is serious!" {laughter}

Elan: Right.

Corey: "Now it's my paycheck on the line, this is serious. I can't use that stuff. I just made it all up. I don't know if it actually works." It's that level of fraudulence that you can tell just boils his blood. That's why it's so funny and refreshing to read Taleb's work because he's just at their throats and that's why he even devotes a part of his book to why he had to become a bodybuilder, because he was getting so many death threats after he successfully predicted the 2008 crash and went out and started dropping names. He became a bodybuilder.

Elan: That reminds me of another story that he gives about a very famous scientist that he's friendly with. He becomes intimates with a lot of different types of characters, established book writers, this famous scientist that he doesn't name, individuals who are in the working class. He's a real student of nature and character and that really comes across. But what he says about this scientist is that every week the guy looks at information that's being said or not said about him. So half of his work is not necessarily the research into science, into his field, but protecting his reputation. Why wasn't this other scientist acknowledging my accomplishments when he got an award? Why is my name not being mentioned in this new study that's come out?

So there's this incredible amount of energy and emotion that Taleb sees as fragile, as unnecessarily self-important and weak, that he'll get into when he discusses the stoics and the works of Seneca, for instance, who took an approach that was at the very least robust, but not weak in a self-important way and not vulnerable to the slings and arrows of ego trampling information or rumour. He's really wonderful that way. You get a sense that he knows himself and he's unapologetic for his points of view because they're learned. They come of hard-earned experience.

But I wanted to get back to an earlier analogy of the taxi driver as an example of an antifragile individual in the more mundane sense of being a worker. Taleb gives this example. He compares the taxi driver to a personnel manager who has a very stable existence in a government or an established corporate atmosphere for many decades. When it's seen that his position is no longer needed or there are cutbacks due to centralization in a particular government, he finds himself in his mid-50s as a middle manager, completely vulnerable and fragile when he's let go, where the taxi driver who works for himself - and they have periods of ups and downs and may on the surface have this position or job that seems to be fragile - is actually more stable because he's already learned the ropes for himself of exactly how much he has to do and where he has to go to make his buck farming people from one side of town to the other.

Another point that's being made here which I think is quite useful is, on the surface of things, what may seem to be quite stable for us from the day-to-day, predictable, mundane, routine, actually in the long-run can be quite fragile and subject to the black swans that we mentioned a little earlier, where finding a more independent, self-reliant route in one's thinking, in one's doing, in one's making a living, in one's relationships, affords a person the possibility for a greater amount of muscle, a greater amount of will exercised in directions based on one's own thinking and being.

So that was really quite interesting to me as an analogy because most of us, let's face it, are stuck in these very 9-5 routine positions for lack of knowledge or the impetus to strike out on our own in some way for fear that it's riskier and Taleb is saying no! It may only seem riskier on the surface of things because it's uncharted territory, because you're relying more on your wits to engage in the environment, engage with other people, engage with your own capacity. That was another really interesting part of the book I thought.

Corey: Yeah. Like the example of the French authors. A lot of them would just get jobs as waiters. So this is the barbell strategy. They have that job as a waiter. There are waiters and then there are other diplomats or sinecure, which was some kind of a French official, very low level. You go to work, you just leave it there and you come back home and then you write books. That's the opposite end of your barbell. It's a little bit risky. You don't have F-you money so you can't just say whatever you want, but you get to engage in something that is fulfilling and interesting and mind-expanding that is much better than just being one of these fragilista policymakers that he describes.

He has a section where he talks about trying to go to lunch with somebody like this, somebody who's just so consumed with the work that they have to do that they just have that dead, soulless look in their eyes, somebody who lives in this position where if something bad were to happen, if there were any kind of volatility, they have almost all downside to this. Whereas these people who are in positions like the French author, like the taxicab driver, they might feel like they don't have a solid ground. They don't feel like they're as robust, I guess in terms of "What do you do for a living?" "Oh, I'm a policymaker." "Oh wow! That guys really made a name for himself."

But in objective terms, this guy who's working as a taxi driver or who is working as a waiter and writing books on the side, they're more antifragile and they have more opportunity for heroism, for development and for being exposed to stressors that will make them more intelligent, stronger, give them a better quality of life if they're able to utilize it properly.

Harrison: Well we've mentioned fragilistas numerous times so far, so I want to read what exactly is a fragilista. Taleb writes,

"In short, the fragilista, medical, economic, social planning, is one who makes you engage in policies and actions all artificial in which the benefits are small and visible and the side-effects potentially severe and invisible."

So that's the short example. In the section where simple is more sophisticated, he writes,

"A complex system, contrary to what people believe, does not require complicated systems and regulations and intricate policies. The simpler the better. Complications lead to multiplicative chains of anticipated effects. Because of opacity, an intervention leads to unforeseen consequences followed by apologies about the unforeseen aspect of the consequences, then to another intervention to correct the secondary effects, leading to an explosive series of branching, unforeseen responses, each one worse than the preceding one."

So this is Thomas Sowell. That's one of the points that he comes back to again and again. Skipping ahead a bit on the subject of fragilistas, this is one example.

"The reader can get a hint of the central problem we face with top down tampering with political systems or similar complex systems. For example, the fragilista mistakes the economy for a washing machine that needs monthly maintenance or misconstrues the properties of your body for those of a compact disc player. Adam Smith himself made the analogy of the economy as a watch or clock that once set in motion, continues on its own but I am certain he did not quite think of matters in those terms, that he looked at the economy in terms of organisms that lacked a framework to express it, for Smith understood the opacity of complex systems as well as their interdependencies since he developed the notion of the invisible hand.

But alas, unlike Adam Smith, Plato did not quite get it. Promoting the well-known metaphor of the ship of state, he likens a state to a naval vessel which, of course, requires the monitoring of a captain. He ultimately argues that only men fit to be captain of this ship are philosopher kings, benevolent men with absolute power who have access to the form of the good and once in a while, one hears shouts of 'Who is governing us' as if the world needs someone to govern it."

This is the section on the difference between antifragile and fragile systems, organic and inorganic systems because organic systems are not machines. There's an important difference. If you look at a human body, it's not just a washing machine because a washing machine is fragile. It needs maintenance. It breaks down over time. It doesn't get better with stress, it actually wears down with stress. You need to replace parts. The body is self-repairing and it's antifragile in the sense that it actually gets better with minor stressors, certain types of stressors.

So there's an important difference between the artificial things that we create, the machines that we create, and our bodies which are much more than those types of machines that are the product of human creativity. But not just bodies, also complex systems, any complex systems. There is culture, the economy, things like that.

It's clear from the quotes that we've read and what we've talked about that he's not in favour of these top-down, centralized approaches. I just want to read one sentence and then get a bit into it. He writes, "For the economy to be antifragile and undergo what is called evolution, every single individual business must necessarily be fragile, exposed to breaking. Evolution needs organisms or their genes to die when supplanted by others in order to achieve improvement or to avoid reproduction when they are not as fit as someone else."

This is kind of a central point that he makes about the economy and about businesses. The reason, for instance, that the restaurant economy will flourish is because of the vulnerability and the fragility of any individual restaurant business. People who are familiar with the restaurant industry know this. Restaurants close down, go bankrupt, all the time and it's the foolhardy courage or stupidity of people who want to get into the restaurant business thinking, 'oh it won't happen to me'. It's because of that that you actually get a thriving restaurant business, because you need people willing to take those risks because a lot of them will fail. And you need those failures in order to actually innovate.

That's the thing about innovation. It needs failure. You need the stressor of failing in order to create that energy for innovation, the need for innovation. If you take that out of the equation, say you have a thriving restaurant business where all these restaurants are going out of business and you get the few that are doing well and then they go bust, it's this constantly churning machine of rising and falling and people getting thrown to the sharks and others having great success. That's a symbol of an entire economy.

But now let's say you have a central planner that comes in and says, "Okay, I'm going to fix this. I'm going to make sure that these small businesses don't fail and we're going to make it stable. So we're going to have one restaurant chain that's going to dominate the entire restaurant scene. We're not going to allow any individual entrepreneurs to open up their own restaurant." So you get a centralized, what he'd call Soviet style cafeteria system where the best food you're going to get is going to be crap. It's not going to be edible. It's just going to be boring. There's not going to be any innovation because the innovation actually comes from that entrepreneurial spirit in that industry and when you get the top-down, centralized approach, it eliminates the possibility of that taking place.

So when you have these government controlled monopolies, there's no reason for innovation and there's no motivation for innovation. If you look at government controlled monopolies they usually have piss-poor products and services. That's the reason. Because there is no competition, because there's no reason for anyone to actually come up with anything better because they've got these cushy jobs. They've got their stability insured by the central authorities. So why do anything on top of that? There's no reason.

Of course it's a dumb reason. Ideally, everyone should be striving to do the best at all times but that's just not the way things actually work. If you take out that centralized system, if you take that out of the equation, then you're left with the restaurant industry as it actually should and naturally would operate and that's a success. It's a success despite all the individual failures because you need those failures in order to have the system as a whole work and to actually get the benefits of that system.

I'm not familiar with all of his theorizing on localism and how things would be better structured. One of his concerns is to make it so that that system, with its ups and downs, failures and successes, can work as well with as little of the downside, as possible. But you can never get rid of the downside. You can never get rid of the idea that a business can fail because that is essential. It's the same thing everywhere on every different level because there's a fractal structure to the way things are. If you look at the human body and just life in general, you have the life system. You have different species. You have different groups. You go down to the human level, you've got societies and cultures of humans and then you've got small groups, villages of people and then you've got a family unit, then your body and your body is composed of individual cells and the cells have their individual proteins and different macromolecules and things inside of them.

On every level, there are stresses that cause cells to die. He uses the example, for instance, of conditioning your body to poisons. When you condition your body to poison, whatever is actually going on, if you're killing off the weak proteins in your cells, like bacterial resistance. So the strong ones live on and reproduce in your body and that makes your body stronger. It's the same thing with your cells. If you're working out, you destroy and rip your muscle fibers so that they grow back and rebuild themselves at a stronger level. It's this process that's going on all the time and to deny that or to try to fix it, to have the hubris to think that you can come in and fix something like nature, that's so far out of your grasp, is just the height of arrogance.

That's exactly what central planners everywhere are. They're just totally arrogant to think that they can succeed at this endeavour when it's completely impossible. It's just a waste of time. You shouldn't even go there. You should instead try to understand and let things happen and maybe try to slightly guide them. But don't try to re-write the system because it knows better than you do.

Corey: Yeah.

Elan: Well you said a couple of things about entrepreneurship that I thought were quite interesting because he celebrates the individual's attempt at trying to do something and even suggests at one point that there should be this entrepreneurs recognition day in light of the fact that people are putting themselves at risk, and that other people are in a position to learn from the failures of other people. He says that that is an antifragile characteristic as well, not that we want to see other people fail at things. You do get a sense that he's rooting for people. He's not a selfish individual. All of this is a kind of act of generosity on his part. It's to share what he's learning.

At the same time, like you said, failure is definitely part of the equation and failing at something in an attempt to be innovative and to take risks and to make things better, is also part of the equation. He moves on with this point at one point and gets into the idea that a lot of speculators, a lot of people who are in the markets are looking at what a lot of other people are doing and doing exactly the opposite. When I read that I thought about this recent bit of news of this very well known investor named Ray Dalio. The alternative news sphere has been filled with articles of late, about how Ray Dalio believes that there's going to be a very big recession and some time between now and March, thinks that the stock market is going to dip by some untold percentage.

So in the midst of all this news about the stock market doing so well and employment being so high and the economy's never been so great, he is betting a billion-and-a-half dollars - I mean really huge sums of money - against what everybody in the mainstream news has been saying for the past year. And people are paying attention to him. So I thought about Ray Dalio and then a few pages later he talks about Ray Dalio as this antifragile predictor of a hedge fund who, for the past 20 years has been this icon of financial success and prediction.

So we can learn from the failures of others. It's a painful process if you have any amount of empathy for the individual who screwed up in some area. But it is also a teachable moment, a time where that lesson, if it isn't learned by the individual who's suffering the error or the suckers and turkeys as Taleb would call it, who are out there in the market listening to all the bad advice and moving in one herd in one direction and doing pretty much all the same thing, you can benefit from, in some way, through that barbell idea that you talked about before Corey, you can look at the riskier side of investment or doing things with your time, and balance it out with the much more paranoid and conservative and well-known things that will leave you at least stable and robust and able to withstand any kind of disappointments.

But there is an approach to all of this that he talks about. I was going to read this little bit here. He says,

"You can control fragility a lot more than you think. So let us refine in three points. Since detecting antifragility or actually smelling it as Fat Tony will show us in the next few chapters."

Fat Tony is Taleb's Brooklyn friend, the guy who's probably connected to the mob. He hangs around all day. He eats a lot. He meets with people. He gets information. He makes investments. He literally smells the fragility in people. He sniffs them out. He sees what they're made of, what their character consists of, what their vulnerabilities are. You can look at it in one of two ways. Well, the guys somewhat of a predator, or you can look at it as someone who is a student of nature, of character, of his environment, of people who are doing things around him and the success and relative failures of the choices that they make. So getting back to that, he says,

"Since detecting antifragility or actually smelling it, as Fat Tony will show us in the next few chapters, it's easier, much easier, than prediction and understanding the dynamics of events, the entire mission reduces to the central principle of what to do to minimize harm and maximize gain, from forecasting errors. That is, to have things that don't fall apart or even benefit when we make a mistake. We do not want to change the world for now. Leave that to the Soviet/Harvard utopists and other fragilistas. We should first make things more robust to defect and forecast errors or even exploit these errors, making lemonade out of lemons.

As for the lemonade, it looks as if history is in the business of making it out of lemons. Antifragility is necessarily how things move forward under the mother of all stressors called time. Further, after the occurrence of an event, we need to switch the blame from the inability to see an event coming, say a tsunami, an Arabosemitic spring or similar riots, an earthquake, a war or a financial crisis, to the failure to understand antifragility, namely, 'why did we build something so fragile to these types of events?' Not seeing a tsunami or an economic event coming is excusable. Building something fragile to them is not."

So this is getting back to the earlier point you were making Corey, which is that we don't have to have the exact time, date and specific black swan that's going to come and wreck things, or at least make things more challenging. But we can anticipate the vulnerability in something that we're responsible for, that we have some control of, that we can empower ourselves to make stronger, to add redundancy to, which is a term that he uses a one point. Redundancy is good. Reinforcing something. Instead of having one flashlight in your house in the event of a blackout, have three flashlights! Have one in each room! Instead of having a store of food of only one type in one place, have food in two or three different caches of different varieties and some you can even barter or exchange with, just to give an analogy.

So redundancy is another big antifragile concept, something that reinforces the strength of an anticipated failure or weakness.

Corey: I think there's a number of really good points to touch on there. One thing that I'm thinking of is when he was writing about the era that we're living in. We're definitely in this strange moment in history. A lot of fragilistas have been planning a lot of interventions. We live in a powder keg. A lot of people are made fragile by pharmaceuticals, by drugs. A lot of problems in the economy just keep being put on the back burner. And like the analogy that he uses of fire management, if you stop small debris from being burned up in small brush fires, then you're just piling up more and more debris and then when the fire does come, it's going to be a massive black swan event.

It seems like we are in an age of that level of fragility, just in terms of people's psychology and our physiology, taking pill after pill for every sort of ailment and all of the fake food made by naïve interventionists who thought that they could genetically modify the food supply and genetically modify everything and there would be no adverse effects, that we could tell nature to do it better than she wants to do it. I would highly recommend reading this book. In fact, probably reading the entire series. I think that we should probably do a show on every one of his books because he's a very unique thinker and he has a lot of heuristics and tools that we can't really cover just in one show. Just reading the book, you're going to be overwhelmed, if you haven't read it already, by the sheer number of tools and heuristics and ways of thinking about situations and little embellishments that he puts on everyday situations that you can use to enhance the options that you have in your own life.

He's all about options. The more options that you have, the more antifragility you have because, say this doesn't work, boom, I've got this option and that. He speaks of them in financial ways too. In that sense, I was wondering if you guys have anything else that you wanted to say about the book?

Harrison: Just one overall point to relate it to some previous shows. Taleb really did a service with coming up with this word and this concept, to be able to give the name to something that we've all known on some level exists, but now that we have the name for it, we can do more with it, understand it better and integrate it more into the part of our lives that we use our thinking for as opposed to just doing.

It relates back to multiple shows we've done, but the one that sticks out for me is Dabrowski's Theory of Positive Disintegration, which is premised on the idea that there is something more to a lot of humans, more than resiliency, that there's something about the shocks and stresses, in this case, of what's often considered mental illness, so extreme neuroses and psycho-neuroses as Dabrowski calls it, that can tear a person down, but out of which something stronger and greater and on a completely different level can emerge, like a phoenix, but actually more than a phoenix because he uses the example of the phoenix.

The phoenix just comes back as a phoenix over and over. It's more like a positive hydra where something is actually transformed into something higher and greater and there's actually a whole other level of this process and concept that goes on that people are unaware of, on the level of psychological growth that gets into the deepest aspects of what religions hint at and present as a possibility, that there is something about human nature and the human spirit that has this antifragility built into it, that can lead to evolution on a scale that is unacknowledged and unforeseen and invisible to most people at most times, but it's there. It's something within human nature and I think that's something that, for those to whom that is a call and has some resonance, that is an idea to be pursued and put into practice in one's life. We'll get into that in other shows.

Corey: It's interesting that you bring up the hydra and the phoenix because I love these books and I would love to see something a little bit more explicitly mythological. You know what I'm saying? Because that's where this fits. In my mind he's taking the world of action and he's describing it and breaking it down and he's getting frustrated by academics. It's interesting, but they're allergic to the idea of antifragility. Clearly Dabrowski probably ran into that throughout his entire career as a psychologist and the theory of positive disintegration didn't really take off. Now we have post-traumatic growth. It's along similar lines.

Harrison: Yeah, it's related.

Corey: It's related, but that's still kind of its own niche field. But antifragility is a concept that you can add to your lexicon and then slot all these other things into it. So it's kind of the mother idea, the mother concept of what benefits from volatility. He has very simple ways to see if you measure up in different areas of your life. Are you a fragilista here? Are you antifragile there? Other than that, that's it for this week. We hope that you tune in next time and if you liked this show, please subscribe, hit like and have a great week everyone. Bye-bye.

Elan: Bye everyone.

Harrison: See you later.