How would Nassim Taleb suggest using the precautionary principle within these fraught political times? How does one situate oneself financially when those who hold the purse strings of the treasury department have no skin in the game themselves? Honest question, Nassim. Thanks for this impressive interview. I love your explanation of risk using human kidney redundancies 😊
Financially? I'd say the first precautionary principle NNT would offer is to avoid holding any debt whatsoever. If I recall, NNT has recommended an 80/20 split of financial assets before now. 80% in ultra-safe, ultra-boring financial instruments (perhaps it was US Government Bonds (?)) and 20% in 'extremistan' assets such as shares. Disclosure I do not follow either of these principles!! Just trying to recall what I've heard NNT say before.
@@MannyPE-oi7pb I don't have the financial wherewithal to follow (i.e. act on) these principles. I employ and attempt to employ several other of his stated principles in other areas of my life
Second-order effects are often unaccounted for by knowing or assessing first-order effects of a phenomenon. And it's easy to forget that. It's is an important perspective applicable to decisions in everyday life. In psychology, I saw that secondary problems were often worse than the primary ones, like getting anxious about getting anxious, or depressed about being depressed. The 2nd order accounted for most of the problems.
Thank you Nassim for tweeting about this and bringing to our attention. I'll take as much of this as I can get. I emailed Ned about statins to forward to you. I am the dog that only thinks about how to get past the fence.
I don't know if this is the right place but I was thinking a lot about NNT's strategies and read all Incerto books (some of them three times). Maybe it is because of my lack of knowledge but options as well as "very safe" bonds always have a counterparty (at least to my understanding). Wouldn't it qualify as a black swan if those counterparties weren't able to fulfill their obligations anymore? If so, this would add another dimension to the barbell strategy because of more implied risk in the 90% which are supposed to be the safe opposites of the 10% high risk trades. What do you guys think and what would be the answer if my assumptions are correct (I know about capital requirements for contracts and so on but again, what if for some black swan reason they don't work out). Thanks for your time
NNT's Universa is "neither bullish nor bearish". Whether the market is crashing or not is simply not relevant to NNT's investing. The fund is ready and able to take advantage of volatility either way; for instance, in a market crash situation, the fund could take advantage of buying good assets at a fair price when "cash is king".
