Incerto 4-Book Bundle: Fooled by Randomness, The Black Swan, The Bed of Procrustes, Antifragile

by Nassim Nicholas Taleb

“No, of course not. This place is different; it has always been different.”

This duration blindness in the middle-aged exile is quite a widespread disease.

I studied exile literature precisely to avoid the traps of a consuming and obsessive nostalgia. These exiles seemed to have become prisoners of their memory of idyllic origin—they sat together with other prisoners of the past and spoke about the old country, and ate their traditional food while some of their folk music played in the background.

One hears endless stories of Cuban refugees with suitcases still half packed who came to Miami in the 1960s for “a matter of a few days” after the installation of the Castro regime.

The dynamics of the Lebanese conflict had been patently unpredictable, yet people’s reasoning as they examined the events showed a constant: almost all those who cared seemed convinced that they understood what was going on. Every single day brought occurrences that lay completely outside their forecast, but they could not figure out that

they had not forecast them.

History Does Not Crawl, It Jumps

I developed the governing impression that our minds are wonderful explanation machines, capable of making sense out of almost anything, capable of mounting explanations for all manner of phenomena, and generally incapable of accepting the idea of unpredictability.

Furthermore, the more intelligent the person, the better sounding the explanation.

Even more than the rise of Christianity, it was the spread of Islam (the third edition, so to speak) that carried full unpredictability; many historians looking at the record have been taken aback by the swiftness of the change.

A later holder of the same history chair at the Collège de France, Paul Veyne, aptly talked about religions spreading “like bestsellers”—a comparison that indicates unpredictability.

the studious examination of the past in the greatest of detail does not teach you much about the mind of History; it only gives you the illusion of understanding it.

History and societies do not crawl. They make jumps.

Dear Diary: On History Running Backward

Consider the nature of information: of the millions, maybe even trillions, of small facts that prevail before an event occurs, only a few will turn out to be relevant later to your understanding of what happened.

you will be inclined

to remember those data that subsequently m...

retrospective distortion

since I learned the difference between forward and backward processes.

How? Simply, the diary purported to describe the events as they were taking place, not after.

I realized that if I were to start writing about the events later they would seem more … historical. There was a difference between the before and the after.

While we have a highly unstable memory, a diary provides indelible facts recorded more or less immediately; it thus allows the fixation of an unrevised perception and enables us to later study events in their own context.

(By “cheating,” I mean removing at the time of publication elements that did not turn out to be relevant to what happened, thus enhancing those that may interest the public.

Shirer’s diary turned out to be a training program in the dynamics of uncertainty.

Education in a Taxicab

I will introduce the third element of the triplet, the curse of learning,

I noticed that very intelligent and informed persons were at no advantage over cabdrivers in their predictions, but there was a crucial difference. Cabdrivers did not believe that they understood as much as learned people—really, they were not the experts and they knew it. Nobody knew anything, but elite thinkers thought that they knew more than the rest because they were elite thinkers,

CLUSTERS

I also noticed during the Lebanese war that journalists tended to cluster not necessarily around the same opinions but frequently around the same framework of analyses.

Categorizing is necessary for humans, but it becomes pathological when the category is seen as definitive, preventing people from considering the fuzziness of boundaries, let alone revising their categories.

But the process of having these people report in lockstep caused the dimensionality of the opinion set to shrink considerably—they

they converged on opinions and used the same items as causes.

Why do those who prefer sexual freedom need to be against individual economic liberty?

I noticed the absurdity of clustering when I was quite young.

The best way to prove the arbitrary character of these categories, and the contagion effect they produce, is to remember how frequently these clusters reverse in history.

What is interesting to me as a probabilist is that some random event makes one group that initially supports an issue ally itself with another group that supports another issue, thus causing the two items to fuse and unify … until the surprise of the separation.

Categorizing always produces reduction in true complexity.

For instance, you may think that radical Islam (and its values) are your allies against the threat of Communism, and so you may help them develop, until they send two planes into downtown Manhattan.

Odds are that one or more of the hundreds of millions of other readers of such information will already have bought the security, thus pushing up the price. I then completely gave up reading newspapers and watching television, which freed up a considerable amount of time (say one hour or more a day, enough time to read more than a hundred additional books per year, which, after a couple of decades, starts mounting).

But this argument was not quite the entire reason for my dictum in this book to avoid the newspapers, as we will see further benefits in avoiding the toxicity of information. It was initially a great excuse to avoid keeping up with the minutiae of business,

the executives of the most powerful corporations were coming to describe what they did for a living, and it was possible that they too did not know what was going on.

At the time, I started becoming conscious of my subject—the highly improbable consequential event.

My idea is that not only are some scientific results useless in real life, because they underestimate the impact of the highly improbable (or lead us to ignore it), but that many of them may be actually creating Black Swans.

8¾ LBS LATER

The drop was not even the response to any discernible news.

I was struck that financial distress could be more demoralizing than war (just consider that financial problems and the accompanying humiliations can lead to suicide, but war doesn’t appear to do so directly).

But I realized then and there that I did not give a hoot about the money. I experienced the strangest feeling I have ever had in my life, this deafening trumpet signaling to me that I was right, so loudly that it made my bones vibrate.

betting on rare and unexpected events, those that were on the Platonic fold, and considered “inconceivable” by the Platonic “experts.” Recall that the Platonic fold is where our representation of reality ceases to apply—but we do not know it.

I studied the flaws and the limits of these models, looking for the Platonic fold where they break down.

Finally, both the philosophy of history and epistemology (the philosophy of knowledge) seemed inseparable from the empirical study of times series data, which is a succession of numbers in time, a sort of historical document containing numbers instead of words.