From Institutional Investor:
Financial industry executives generally got the messages of
Fooled by Randomness and The Black Swan, the
books published in 2001 and 2007, respectively, that brought
Nassim Nicholas Taleb to prominence as a philosopher of
markets, volatility and probability. They were not easy reads,
and their warnings of impending doom didn’t prevent the
meltdown of 2008–’09. But they were bestsellers that
established Taleb, distinguished professor of risk engineering
at New York University Polytechnic School of Engineering, as
one of the leading public intellectuals in finance,
quantitative and otherwise.
Books with such far-reaching business implications spawn
others that bring theoretical concepts down to the practical
level. In Stalking the Black Swan (2010), longtime
Morgan Stanley specialty finance analyst Kenneth Posner advises
looking beyond the rare, catastrophic shocks that are the black
swans of Taleb’s title: those that are not predictable
through conventional extrapolation of historical data but need
to be factored in if future crises are to be avoided. Posner
calls investors’ attention to “plenty of smaller,
more mundane swans, whipsawing individual stocks and sectors
even when the rest of the market is calm” — and the
risks and opportunities they present.
Taleb is barely mentioned in The Dao of Capital
(2013), a memoir and free-market manifesto by Mark Spitznagel,
but the book’s lineage is clear: Taleb advises
Spitznagel’s Miami-based Universa Investments in the
latest stage of a 15-year relationship between two former pit
traders.
Public reaction was less enthusiastic to Taleb’s 2012
Antifragile: Things That Gain from Disorder. (The U.K.
edition had a different subtitle: How to Live in a World We
Don’t Understand.) The volume is dense, and the
follow-on literature sparse. Taleb’s “voluminous and
very significant work on uncertainty” has “wonderful
far-reaching consequences — albeit less straightforward, I
believe, for capital investment,” Spitznagel wrote in
The Dao of Capital.
Antifragile is high-concept, to be sure. Taleb is
not merely saying that systems and organizations need to be
better able to withstand inevitable shocks and crises. He
believes antifragility is a built-in trait or characteristic of
systems that adapt and strengthen through adversity.
Antifragile systems “benefit from volatility,” the
scholar has said. When stressed, the antifragile becomes more
resilient, whereas the fragile bends and breaks.
It did not help Taleb’s cause that there were few, if
any, practical and independent interpretations of
antifragility. It seems applicable to any number of systemic
challenges. In a July 13, 2009, Financial Times
commentary co-authored with Spitznagel, Taleb said that
“debt and leverage cause fragility” in the economic
system as a whole. “The only solution is to transform debt
into equity across all sectors, in an organized and systemic
way” — to introduce antifragility, as Taleb would
argue over time....MORE
Here's a rare picture of a not-so-rare white swan taking the cygnets for a cruise:
