Antifragile Flashcards
What is the antifragile Triad?
Fragile -> Robust -> Antifragile
Antifragile is a system or phenomenon that benefits from unexpected events or outcomes.
What is the shape of the curve of associated payoffs between fragile and antifragile systems?
Fragile - concave, more to lose than gain as especially in situations of volatility
Antifragile - convex, more to gain than lose especially in situations of volatility
What is the first step toward antifragility?
Focus on the downside and worst case scenario risk. Reduce the risk of black swans.
What does the fragile curve of pain look like?
For the fragile, the cumulative effect of small shocks are smaller than the single effect of a large shock. Small shocks lull us to sleep making the large shock that much more destructive.
Antifragile, shocks bring more benefits as their intensity increases.
What is a good substitute for prediction?
Prediction in most cases is impossible except within very wide bands.
A good substitute is considering any scenario, especially the scenarios for pain, and planning around them.
What are iatrogenics?
Means “Caused by the healer” in Greek. Problems introduced through naïve interventionism, creating fragile systems in an attempt to reduce volatility in the short run. Applies to markets, medicine.
What is the answer to iatrogenics in medicine?
Rarely intervene unless the risks to health are great, where we should take massive risks.
What is the barbell strategy to risk?
On one end of the barbell, take very little correlated risk to ensure security, and at the other end of the barbell take many high, smaller risks that would benefit from volatility. Avoid the middle ground where everyone else operates, the medium risk level that, if exposed to black swans, could wipe you out.
What is optionality and how can you benefit?
Optionality = asymmetry + rationality
Prediction is impossible. Position yourself to have asymmetric upside potential and use trial and error to rationally identify the big opportunities where you should place bets.
Why can hueristics be better than data?
Data overload can cause meaningless conclusions. Hueristics boil decisions down to what matters most, and uses time tested informational cues for decision making.
Overcomplication and overconfidence from the inclusion of many datasets can cause us to miss very elementary points.
What is the tourist vs. the flanuer, and how is it applied to life?
Tourist follows a strict plan, flaneur makes decisions at every step to revise their schedule. The flaneur is much more likely to get to a better and more complete outcome by RATIONALLY modifying the target with more information (tinkering).
What is the Soviet-Harvard Illusion?
Academics and research lead to technology and practice.
In reality, Hueristics -> Practice and Apprenticeship -> Random Tinkering -> Heuristics etc. in a cycle.
Academics and research are often too rigorous in their teleological goals to develop real value.
What is neomania?
The constant desire to upgrade based on a search for the new.
Getting a short term boost in satisfaction from the changes in technology with a minimal utilitarian impact, shortly causing another search for the new.
What is via negativa?
The principle of reduction in explaining God (specifically explaining what God is not). The principle of reduction should be applied as a solution much more often than additions.
People become rich by not ging bust, chess grandmasters win by not losing, you become healthy be removing unhealthy food and activities etc. The learning of life is about what to avoid.
What is subtractive epistemology?
Removing what is wrong from what we think. We can know a lot more about wrong thinking than right thinking.
Because one small observation can disprove a statement while millions can hardly confirm it, subtraction is much more rigorous than confirmation.
