Quotes About Risk

do not try to predict precise Black Swans—it tends to make you more vulnerable to the ones you did not predict.

The hidden harm of fragility is that you need to be much, much better than random in your prediction and knowing where you are going, just to offset the negative effect.

Remember that positive Black Swans have a necessary first step: you need to be exposed to them.

A life saved is a statistic; a person hurt is an anecdote. Statistics are invisible; anecdotes are salient. Likewise, the risk of a Black Swan is invisible.

When you become rich, the pain of losing your fortune exceeds the emotional gain of getting additional wealth, so you start living under continuous emotional threat.

The more uncertainty, the more role for optionality to kick in, and the more you will outperform.

Never cross a river if it is on average four feet deep

a system that doesn't have a mechanism of skin in the game, with a buildup of imbalances, will eventually blow up and self-repair that way.

It is not just bailouts: government interference in general tends to remove skin in the game.

exposed to a major blowup without being aware of it

You cannot look at the future by naive projection of the past.

In the decentralized hedge fund space, on the other hand, owner-operators have at least half of their net worth in the funds, making them relatively more exposed than any of their customers, and

Put yourself in situations where favorable consequences are much larger than unfavorable ones.

and I should base my decisions around that.

The policies we need to make decisions on should depend far more on the range of possible outcomes than on the expected final number.

Los emprendedores son unos héroes en nuestra sociedad. Fracasan por el resto de nosotros

Nassim Nicholas Taleb

gravest of all manifestations of silent evidence, the illusion of stability. The

what is absent from the data should be taken into account—absence of Black Swans in the record doesn't mean these were not there.

Los Cisnes Negros que imaginamos, de los que hablamos y nos preocupamos no se parecen a los que previsiblemente son Cisnes Negros. Como veremos a continuación, nos preocupamos de los sucesos «improbables» equivocados.

The bias lowers our perception of the risks we incurred in the past, particularly for those of us who were lucky to have survived them. Your

in order to make a decision you need to focus on the consequences (which you can know) rather than the probability (which you can't know) is the central idea of uncertainty.

Monte Carlo (the old name for a roulette wheel)

but their error rate is so large that it is far more significant than the projection itself!