Learnings from reading the Incerto

Well, it took me a year, but, I’m finally done with every part of the Incerto apart from the technical companion ( which I intend to read )

I think I’m going to do this in two parts because there’s just so much that I’ve taken away from reading the books in the series.

I read the books in the order of my interest in them.

• Black Swan
• Antifragile
• The Bed of Procrustes
• Skin in the Game
• Fooled by Randomness I had heard about Black Swan and Antifragile in the past but never got around to reading them. I found the book in a Senior colleagues office library and promptly borrowed it.

The context is quite important to understand my motivations for reading the work.

As I had detailed in living with loss, I had been dealing with multiple personal Black Swans in a short period of time. The events were : unpredictable, uncertain, random, highly impactful, negative, and wiped out all previous gains.

So, imagine my surprise when I read a book written by a trader, mathematician, flaneur that talked to me about exactly what I was going through. I was hooked.

In some sense I was searching for meaning in the book, hoping it would help me explain the events. Taleb quickly flipped the world in a few chapters and prevented me from making that mistake.

Black Swan was a real eye opener for me, what I gained personally out of it is fantastic.

What the books are about

The truth is, the books are about several things, far too many to put into a single post.

But, on a fundamental level, the books are about 5 concepts.

Bear in mind, this is my take on it, i.e what I took away from the books, these might not be authors stated concepts themselves.

1. Our fragile understanding of probability and the pitfalls of putting this understanding into practice
2. A take on Stoicism that enables one to be a person of action ( I found echoes of this in the Gita )
3. Cognitive biases, Scienticism ( the pretend sciencing of everything ) without allowing for the Scientific method to take root and, the people who take advantage of it
4. The concept of ‘Skin in the Game’ and, how to identify and protect yourself/use leverage in situations where there is an asymmetry in upside vs downside
5. Finally, the concept that spoke to me the most, Antifragility : The opposite of fragility is not robust, but, Antifragility. Here’s what I’ve learned from the Incerto.

• You cannot completely predict the future based on the past

• The effect of a few wrong predictions can outweigh the effects of several right ones

• People’s opinions must carry different weights ( 0–1 ) based on what they have to lose by offering their opinion — Skin in the Game

• Outcomes are almost independent of actions, as a result, the ability to become better at actions regardless of outcomes is paramount

• Respect people who take risks, try to be one

• Beware of virtue signallers

• The difference between the Scientific method and Scientism

• The core concept of Antifragility

• The role of luck and how to not assume causality

• The role of risk in our daily lives and language

• The power of leverage and how to apply it

• The importance of mental models, heuristics and the advantage of using them versus rules Why you should read each book

• Black Swan — If you’re going through a phase of incredible good/bad luck and find yourself praising yourself/blaming yourself for it, read this book. If you’re going through a phase in life where everything is at an impasse, read this book. Point being, read this book.

• Antifragile — If you’ve been impacted heavily by a ‘Black Swan’ or know someone who has, and, you’ve been left looking for the ground you were standing on or are up in the sky, read this book to understand how to stay grounded and to understand that probabilities, predictions, efficiencies and optimisations are sometimes bad, we need to go further and we need to be better. Also, how governments and societies used to be, and can still be Antifragile.

• The Bed of Procrustes — If you’re looking for mental models and aphorisms that summarise the rest of the books in the series, read this.

• Skin in the Game — If you’re wondering why people who get so many things wrong get to be called experts, why people who have nothing to lose have so much so say, why your voice counts for much less than you think it does even though you have the most to lose and why fake news is real — Read this book.

• Fooled by Randomness — If you have been a victim of forecasters/predictors who tell you the world has a 99.99% chance of being a particular way but in the end wasn’t, read this book to understand why that is the wrong game to be playing. Conclusion

I’ve been hugely impacted by reading this series of books. I think I’ve finally gone from ‘Nerd’ to ‘Non-Nerd’, I was somewhere in between for the longest time. Not that being a nerd is bad, it’s just not good — for me, right now.

Much like the book Black Swan explains, it was chance encounter that led me to pick up the book itself that led me down this path. I consider it a huge positive Black Swan. I’ve maximised my gains in the last year.

Thank you for reading

Sainath