We’ve been arguing that “to finish first, first you must finish“ for over twenty years. We’ve also recently argued for cash as a strategic weapon with both defensive and offensive features: it is as much “cushion” as it is “cannon”. Nicholas Nassim Taleb has given a lecture recently at the Univ. of Pennsylvania (the 68-minute video is embedded inside), and the main takeaway is this: “(…) you live long by not dying, you win in chess by not losing—by letting the other person lose. So negative investment is not a sissy strategy. It is an active one.” — It is always interesting to hear him as a reminder of the constant mental traps we fall into, be it “fooled by randomness”, the difficulty of dealing with “black swans” and the concept of fragile/ anti-fragile systems. It also highlighted the planning fallacy, something David Brooks wrote about even more recently, so we’re taking the opportunity to post both together. H/T Farnam Street Blog for linking to both stories over the weekend.
Here’s the embedded video: