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Traders who made money, I realized, could get so disruptive that they needed to be kept away from the rest of the employees. That’s the price you pay for turning individuals into profit centers, meaning no other criterion mattered.
As we saw with Ahiqar’s wild ass, freedom is never free.
If you were profitable you could give managers all the crap you wanted and they ate it because they needed you and were afraid of losing their own jobs.
Freedom is always associated with risk taking, whether it leads to it or comes from it. You take risks, you feel part of history. And risk takers take risks because it is in their nature to be wild animals.
In my day, nobody cursed in public except for gang members and those who wanted to signal that they were not slaves: traders cursed like sailors, and I have kept the habit of strategic foul language, used only outside of my writings and family
So cursing today is a status symbol, just as oligarchs in Moscow wear blue jeans at special events to signal their power.
What matters isn’t what a person has or doesn’t have; it is what he or she is afraid of losing. The more you have to lose, the more fragile you are.
Well, the higher you go in that business, the more insecure you get, as losing an argument to a lesser person exposes you more than if you lose to some hotshot.
Watching Putin made me realize that domesticated (and sterilized) animals don’t stand a chance against a wild predator. Not a single one. Fughedabout military capabilities: it is the trigger that
People whose survival depends on qualitative “job assessments” by someone of higher rank in an organization cannot be trusted for critical decisions.
The employee has a very simple objective function: fulfill the tasks that his or her supervisor deems necessary, or satisfy some gameable metric.
So we lost a generation: someone who went to grammar school in Saudi Arabia (our “ally”) after September 11 is now an adult, indoctrinated into believing and supporting Salafi violence, hence encouraged to finance
Instead of invading Iraq or blowing up “Jihadi John” and other individual terrorists, thus causing a multiplication of these agents, it would have been better to focus on the source of the problems: Wahhabi/Salafi
education and the promotion of intolerant beliefs according to which a Shiite or an Ezidi or a Christian are deviant people.
friend Rory Sutherland (the same Rory) explained that some more intelligent corporate representatives had the strategy of cursing while talking to journalists in a way to signal that they were conveying the truth, not reciting some company mantra.
Being ethical comes at a huge cost to others.
Society likes saints and moral heroes to be celibate so they do not have family pressures that may force them into the dilemma of needing to compromise their sense of ethics to feed their children.
The vulnerability of heads of households has been remarkably exploited in history.
It is no secret that large corporations prefer people with families; those with downside risk are easier to own, particularly when they are choking under a large mortgage.
To make ethical choices you cannot have dilemmas between the particular (friends, family) and the general.
Financial independence is another way to solve ethical
dilemmas, but such independence is hard to ascertain: many seemingly independent people aren’t particularly so.
Intellectual and ethical freedom requires the absence of the skin of others in one’s game, which is why the free are so rare.
This method—of hitting you where they think it hurts—implies hitting people around you who are more vulnerable than you.
By the minority rule, all it takes is a very small number of detractors using misplaced buzzwords of the type that makes people cringe (such as “racist”) to scare an entire institution.
In addition, those who engage in smear campaigning as a profession are necessarily incompetent at everything else—hence at that business too—so the industry accumulates rejects who are prone to ethical stretches.
To be free of conflict you need to have no friends.
Deuteronomy makes a separation: “Fathers shall not be put to death because of their children, nor shall children
be put to death because of their fathers. Each one shall be put to death for his own sin.”
The rule should be: You kill my family with supposed impunity; I will make yours pay some indirect price for it.
The unusual nuisance with jihadi terrorism is that we are totally defenseless in front of a deluded person willing to kill scores of innocents without any true downside, that is, no skin in the game.
The only way we have left to control suicide-terrorists would be precisely to convince them that blowing themselves up is not the worst-case scenario for them, nor the end scenario at all. Making their families and loved ones bear a financial burden—just as Germans still pay for war crimes—would immediately add consequences to their actions.
In the last two chapters we examined the good and the bad of dependence and the constraints on our freedoms coming from skin in the game.
People can detect the difference between front- and back-office operators.
Fat Tony wisdom: always do more than you talk. And precede talk with action. For it will always remain that action without talk supersedes talk without action.
rebellion against the inner circle of no-skin-in-the-game policymaking “clerks” and journalists-insiders, that class of paternalistic semi-intellectual experts with some Ivy League, Oxford-Cambridge or similar label-driven education who are telling the rest of us 1) what to do, 2) what to eat, 3) how to speak, 4) how to think, and…5) whom to vote for.
circularities—their main skill is a capacity to pass exams written by people like them, or to write papers read by people like them. Some of us—not Fat Tony—have been blind to their serial incompetence.
The modern IYI has attended more than one TED talk in person or watched more than two TED talks on YouTube. Not only did he vote for Hillary Monsanto-Malmaison because she seemed electable or some such circular reasoning, but he holds that anyone who didn’t do so is mentally ill.
The Intellectual Yet Idiot knows at any given point in time what his words or actions are doing to his reputation. But a much easier marker: he doesn’t even
Also the IYI thinks this criticism of IYIs means “everybody is an idiot,” not realizing that their group represents, as we said, a tiny minority—but they don’t like their sense of entitlement to be challenged, and although they treat the rest of humans as inferiors, they don’t like it when the water hose is turned to the opposite direction (what the French call arroseur arrosé).
It is safe to say that the American public—actually all publics—despises people who make a lot of money on a salary, or, rather, salarymen who make a lot of money.
will propose that what people resent—or should resent—is the person at the top who has no skin in the game, that is, because he doesn’t bear his allotted risk, he is immune to the possibility of falling from his pedestal, exiting his income or wealth bracket, and waiting in line outside the soup kitchen.
There is something respectable in losing a billion dollars, provided it is your own money. In addition, someone without skin in the game—say, a corporate executive with upside and no financial
downside (the type to speak clearly in meetings)—is paid according to some metrics that do not necessarily reflect the health of his company; these he can manipulate, hide risks, get the bonus, then retire (or go do the same thing at another company) and blame his successor for subsequent results.
True equality is equality in probability. and Skin in the game prevents systems from rotting.
Visibly, a problem with economists (particularly those who never took risk) is that they have mental difficulties with things that move and are unable to consider that things that move have different attributes from things that don’t.
Static inequality is a snapshot view of inequality; it
does not reflect what will happen to you in the course of your life.
Dynamic (ergodic) inequality takes into account the entire future and past life.
The way to make society more equal is by forcing (through skin in the game) the rich to be subjected to the risk of exiting from the 1
