jerryking + unpredictability   33

Always seek out novelty — even at home
April 26, 2019 | Financial Times | by Tim Harford.

* The search for new experiences should not just be for our holidays.
* Japan: 10 days in a far-off land produces a richer treasury of detailed memories than 10 weeks back home. But why?
* Actively searching for new experiences --whether on holiday abroad or within your daily routine at home!!
* Novelty isn't just about mental stimulation. It also exposes you to opportunity.....Variation also reshapes the mental categorisation of experiences, so that freshness can be found within routine activities.
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While on an adventurous holiday, many people experience that strange sense of time having slowed down in the most pleasurable way, and of conversations that begin, “Was it really only yesterday that we . . . ?”

Ten days in a far-off land produces a richer treasury of detailed memories than 10 weeks back home. But what is behind this phenomenon?

Claude Shannon,in 1948, published one of his two profound contributions, A Mathematical Theory of Communication,.....a message can be compressed to the extent that it is predictable. ....(e.g. Ritualised conversations (“How are you?” “Very well, thank you. How are you?”) can be heavily compressed.....A movie can be compressed because, between cuts, each frame tends to resemble the previous one....Although the parallel is not exact, much the same thing seems to be going on with our memories of life. The brain is not a video recorder; we recall the gist. Sometimes the gist is very brief. If I get up in the morning at the usual time, eat my customary breakfast and catch my usual train to the office, why should my brain trouble itself to remember this day two weeks after the fact? The diffs are barely worth bothering with. In contrast, fresh experiences defy compression: the diffs are too big........Brian Christian, author of The Most Human Human, a book about conversations between humans and computers, speculates that if we’re seeking advice we should ask the person of whose answer we are least certain. If we want to understand a person, we should ask them the question to which we are least sure of their answer.
algorithms  compression  creativity  creative_renewal  economists  experience_economy  fresh_eyes  habits  holidays  insta-bae  Japan  mybestlife  novelty  non-routine  Slow_Movement  Tim_Harford  travel  unpredictability  vacations 
april 2019 by jerryking
5 Ways to Value Your Collection, Whether It’s Fine Wine or Shrunken Heads
March 1, 2019 | The New York Times | By Paul Sullivan.

Collectible assets include wine, spirits, coins, trading cards as well as more unusual items, like lighters, belt buckles and even shrunken heads. These collections cost money and time to assemble and certainly have a value to their owners, but can they be considered legitimate investments? That depends on the market.

For many collectors, the only option to buy, sell or even value these assets is through online auction platforms like eBay or enthusiast sites, but for others, their possessions are treated as fine art.......the market for collectibles, which are often valued in the millions of dollars, may not always be so easy to weather. It can experience sudden surges that put desired items out of the reach of true collectors or it can collapse, wiping out the gains speculators thought they had made.

In an economic slowdown, how these investments are treated depends on supply and demand as well as unpredictable forces like fashion and popularity.....Collectibles can be broken into categories determined by provenance, rarity and even a moment in time. Here are five issues to consider when weighing the investment potential of your collection.....
(1) The standouts in the crowd - Leading the pack are high-quality items that have broad name recognition.
(2) High risk, high reward -
(3) Not all collectibles are investments- jewelry is not an investment....because the market is driven too much by changing fashion.
(4) Obscure and difficult to sell - establish the value of esoteric collections by using third-party appraisers. But insurance companies like A.I.G. value these collections by their replacement value, not by the price someone would pay for them.
(5) A market downturn - =hether it’s shrunken heads, 1,000 bottles of wine or sheets of trading cards, a ready buyer may not be available — or may want to pay much less (i.e. a step change in the valuation).
collectibles  collectors  high-risk  howto  obscure  valuations  AIG  auctions  assets  brands  eBay  economic_downturn  esoteric  fine_arts  high-end  high-quality  investing  investments  passions  step_change  unpredictability  wine  whisky  online_auctions 
march 2019 by jerryking
Cold storage: Planning for unpredictability
July 2, 2018 | - Modern Materials Handling| By Josh Bond, Senior Editor.
cold_storage  unpredictability 
november 2018 by jerryking
What Land Will Be Underwater in 20 Years? Figuring It Out Could Be Lucrative
Feb. 23, 2018 | The New York Times | By Brad Plumer

In Charleston, S.C., where the ports have been expanding to accommodate larger ships sailing through the newly widened Panama Canal, a real-estate developer named Xebec Realty recently went looking for land to build new warehouses and logistics centers.

But first, Xebec had a question: What were the odds that the sites it was considering might be underwater in 10 or 20 years?......Yet detailed information about the city’s climate risks proved surprisingly hard to find. Federal flood maps are based on historical data, and won’t tell you how sea-level rise could exacerbate flooding in the years ahead.....So Xebec turned to a Silicon Valley start-up called Jupiter, which offered to analyze local weather and hydrological data and combine it with climate model projections to assess the potential climate risks Xebec might face in Charleston over the next few decades from things like heavier rainfall, sea level rise or increased storm surge....the reliability of Jupiter's predictive analytics is uncertain....that said, “In economics, information has value if you would make a different decision based on that information,”...... Congress has generally underfunded initiatives such as those at the Federal Emergency Management Agency to incorporate climate change into its federal flood maps.......to get a full picture of flooding risk, you need expertise in weather, but also climate and hydrology and engineering and running complex models on the latest computer hardware,” ... “All of those specialized disciplines are usually heavily siloed within the public sector or the scientific community.”....Jupiter, which acknowledges the uncertainties in climate forecasting, will have to prove that a market exists....flooding and other disasters have led to record losses by insurers.....[Those] losses raised the stakes in terms of trying to get the best possible science on your side when you’re pricing risk,” said John Drzik, president of global risk at Marsh,
climate_change  weather  start_ups  data_driven  forecasting  hard_to_find  predictive_analytics  tools  Charleston  South_Carolina  uncertainty  sea-level_rise  floods  commercial_real_estate  adaptability  specificity  catastrophes  catastrophic_risk  unpredictability  coastal  extreme_weather_events  insurance  FEMA  cartography  floodplains  flood-risk  flood-risk_maps  mapping 
february 2018 by jerryking
Knowing what we don’t know is an important investing skill,
DECEMBER 19, 2017 | The Globe and Mail | Scott Barlow, Globe and Mail market strategist.

"Making short-term predictions about how a price chart reflecting the actions of millions of people will fluctuate is more than just hard. The word Mandelbrot uses is "unpredictable" rather than difficult. Again: not predictable… Mandelbrot is not saying that investors should throw their hands in the air and quit, but rather that they should use the tools of probability in a more refined and nuanced way… Risk comes from now knowing what you are doing and avoiding those areas [that are inherently unpredictable] is a very good thing."

Mr. Mandelbrot's concepts do not make for easy reading and I don't pretend to understand even a majority of their implications. It is important, I think, for investors to have a general understanding of his findings nonetheless.

For one thing, Mr. Mandelbrot's work throws a huge wrench into Modern Portfolio Theory, the highly popular efficient frontier investing strategies that use distribution curves and standard deviation as a measure of risk. As Berkshire Hathaway's Charlie Munger said, "if you think [distribution curves] apply to markets, then you must believe in the tooth fairy. It reminds me of when I asked a doctor at a medical school why he was still teaching an outdated procedure, and he replied, 'It's easier to teach.' "
investing  risks  financial_markets  investors  Charlie_Munger  unpredictability  pretense_of_knowledge  unknowns 
december 2017 by jerryking
Water, water, everywhere
Saturday , September /Sunday 3 September 2017 | Financial Times | Sophie Knight.

The Netherlands has been the champion of water management for centuries, battling to keep its low-lying landmass dry. But as extreme weather events and high temperatures outstrip even the most pessimistic predictions, some argue that even the most sophisticated dikes won’t be enough.....
Rotterdam-based architectural studio ZUS, which has developed “Delta 3000”, a plan to transform the lowlands into a hilly sandy landscape. Covering the country in sand would prevent flooding, produce fresh water and create a naturally sustaining ecological system — which ZUS argues is better than the current cost and energy-intensive defence plan against the rising sea. The Netherlands uses a maintenance- intensive system of seawalls, dams, dikes, sluices, pumps and locks to protect the 55 per cent of the country prone to flooding. The government plans to update this system to combat the increased risk of flooding and reduced freshwater availability that they expect to come with climate change.

“[The current system is] artificial and is completely dependent on human intervention and technical adjustments,” says Kristian Koreman, one of the co-founders of ZUS along with Elma van Boxel. “Whereas with the dunes, finally you’re safe: you’re building higher ground.”.....The climate change debate has provoked a paradigm shift in landscape design due to the uncertainties it brings with it. Forced to abandon the notion that nature can be dominated, architects are now seeking to work with nature rather than against it,resurrecting ailing ecosystems or creating new ones to adapt to the future climate. ...
“The only thing that you can know about climate change is that we can’t predict it,” says Koreman. “But what we do know is that the basic codes of the system are not capable of dealing with the new complexity we are dealing with now: more rain, flooding rivers, salinisation, subsidence and migration were not considered when they made the original Delta plan [in the 1950s].”

ZUS’s counter-proposal is to cover the lowlands in sand, with enormous dunes ringing major cities and creating inland beaches next to lakes and canals. The first plan covered the conurbation that includes Amsterdam, Rotterdam and The Hague, but was extended to run up the entire Dutch coast after requests from vulnerable northern provinces.
water  floods  Netherlands  Dutch  water_management  extreme_weather_events  climate_change  resilience  unpredictability  sea-level_rise  human_intervention 
september 2017 by jerryking
Why the electoral surprises keep on rolling in
June 16, 2017 | Financial Times | Gillian Tett.

...."I offer up the acronym “FUCU” — not simply because this summarises what many voters think about their leaders (with apologies to anyone who is offended), but because the letters F, U, C and U point to four important trends."

The first letter, “F”, stands for “Fragmentation”. Modern voters are deeply fragmented and polarised in a social, economic and political sense....But what is fascinating about the 21st century is that while our digital technologies create the illusion that humans are hyper-connected, in fact they divide us in subtle ways....Twitter, Facebook and other social platforms enable us to connect — but only with people we actively select.... Furthermore, since these cyber platforms supply news and information, they tend to fuel tunnel vision and polarisation, as extensive research from data scientists shows.

“U”, the acronym’s second letter, stands for “Untrusting”. ...popular trust in mainstream western institutions has crumbled. But what is more interesting is to look at who people do still actively trust.

‘While our digital platforms create the illusion that humans are hyper-connected, in fact they divide us in subtle ways’....A survey conducted by the public relations firm Edelman, for example, shows that public trust in tech companies has stayed sky-high in recent years. And while trust in leaders and “experts” has fallen, it remains high for our peer groups, suggesting that trust is moving from a vertical axis to a horizontal one. So while only 37 per cent of people trust chief executive officers, 53 per cent trust employees; and while only 29 per cent trust government officials, 60 per cent trust “a person like me”.....The third letter in the acronym stands for “Customisation”. This trend is not widely discussed, but it is crucial. As digital technologies have taken hold in recent years, consumers have started to see it as a God-given right that they should be able to organise the world around their personal needs and views, instead of quietly accepting pre-packaged offerings..... these three trends produce an environment that creates an environment that is the last part of the acronym: “Unstable”. A world with a FUCU culture is a place of political cyber flash mobs, in which passion suddenly explodes around a single issue or person, then dies away. It is a place where it is hard to have a sustained conversation about political trade-offs, and where voters and politicians jump across traditional boundaries with dizzying speed, defying labels as they go.
Gillian_Tett  elections  surprises  fragmentation  customization  instability  unpredictability  trustworthiness 
august 2017 by jerryking
Why Warren Buffett Keeps Framed Reminders of Awful Moments in Economic History
Olivia B. Waxman
Jan 26, 2017

"I wanted to put on the walls days of extreme panic in Wall Street just as a reminder than anything can happen in this world," he says in this clip provided exclusively to TIME, from the upcoming HBO documentary Becoming Warren Buffett. "It's instructive art."
Warren_Buffett  Berkshire_Hathaway  web_video  panics  economic_history  art  unpredictability  unthinkable  imagination  uncertainty  HBO  documentaries  artifacts  reminders 
february 2017 by jerryking
Emerging markets offer clue for investors in 2017
December 31/January 1 2017 | Financial Times | by Gillian Tett.

Now (people = politicians = capriciousness/alternatively, unpredictable waves of populism) are shaping events, not established party platforms or policy programmes....the pricing of political uncertainty has moved from being an emerging market phenomenon to an emerged market issue....Is there any way for investors to adapt to this new world? ....(1) Start by abandoning the idea that asset values can be predicted by using neat economic models alone. ...investors urgently need to think about the difference between "risk" (i.e. events that can be predicted with a certain probability) and "uncertainty" (i.e. unknown future shocks). Until now, investors in developed markets have tended to focus primarily on risks and assume that these can be priced (and hedged against). But 2017 is likely to produce uncertainty. That cannot be easily priced or hedge--and investors should recognize this. (2) Investor should also embrace "optionality": the only way to prepare for a world of uncertainty is to stay as flexible and diversified as possible. Now is not the time for investors to put all their eggs in one basket, or bet on just one asset class. Nor is it time for businesses to be locked into rigid business plans: political and geopolitical upheaval could strike almost anywhere. (3) If 2017 does deliver more risk and uncertainty, expect financial markets to be "skittish" about "news" of all types, and not just economic....Bad news for those who despise market volatility (expectation: we're in for volatility like we've never seen before)....Uncertainty can deliver huge opportunity alongside risks..."good" surprises....Surviving 2017 in the developed economies requires that investors use tools beyond those found in the realm of economics: psychology, sociology and political science. Also, talk to successful emerging market investors to find out how they practice their craft.
concentration_risk  Gillian_Tett  emerging_markets  political_risk  unpredictability  Brexit  investors  Donald_Trump  uncertainty  risks  optionality  geopolitics  financial_markets  politicians  volatility  tools  economics  psychology  sociology  political_science  FT  institutions  rule_of_law  Gary_Cohn  populism  indicators  human_factor  assets  asset_values  asset_classes  diversification  dislocations  bad_news 
january 2017 by jerryking
From terrorism to technological disruption: Leaders need to tackle risk - The Globe and Mail
DAVID ISRAELSON
Special to The Globe and Mail
Published Wednesday, Jan. 27, 2016

“Not only do they have to think about and worry about economic changes and what their competitors are going to do, they now have a whole new level of political and regulatory risk,” Ms. Ecker says.

“You can’t predict in some cases how a policy maker is going to move. We’re seeing that in China now.”

At the beginning of 2016, as markets began a steep slide in China, that country’s regulators twice activated a “circuit breaker” mechanism to halt trading, only to abandon it after it appeared to make the drop in the market even worse.

The lesson is that sometimes “business practices and even business products that seem acceptable today, for whatever reason, when something happens can be considered things you shouldn’t be doing. There’s more policy unpredictability than ever before,” Ms. Ecker says.

“In an increasingly risky world, a CEO needs to be increasingly flexible and adaptable. You also need to have a team and know what the latest threat might be.”

That isn’t necessarily easy, she adds. “There’s no rule book. When I was in politics, people used to ask me what we should anticipate. I’d tell them, ‘Read science fiction books.’ ”....CEOs in today’s risky world also need people skills that may not have been necessary before, says Shaharris Beh, director of Hackernest, a Toronto-based not-for-profit group that connects worldwide tech companies.

“CEOs have always needed strong skills around rapid decision-making and failure mitigation. In today’s hypercompetitive startup business climate, leaders need two more: pivot-resilience and proleptic consensus leadership,” he says.

“Pivot-resilience is the ability to tolerate the stress of gut-wrenching risks when dramatically shifting strategy. In other words, be able to take the blame gracefully while still warranting respect among your team members.”

Proleptic consensus leadership is especially important for startups, Mr. Beh says. “It’s the ability to garner the team’s support for taking big risks by giving them the assurance of what backup plans are in place should things go sour.”

This consensus building “is how you keep support,” he adds. In a volatile economy, “people can jump ship at any time or even unintentionally sabotage things if they’re not convinced a particular course of action will work.” So you have to constantly persuade.
science_fiction  law_firms  law  risks  CEOs  risk-management  disruption  BLG  leaders  pivots  resilience  consensus  risk-taking  contingency_planning  unpredictability  political_risk  regulatory_risk  policymakers  flexibility  adaptability  anticipating  people_skills  circuit_breakers 
february 2016 by jerryking
You can’t predict a black swan - The Globe and Mail
KONRAD YAKABUSKI
The Globe and Mail
Published Thursday, Jan. 29 2015

The New York snowstorm that wasn’t, like the Swiss currency storm that was, are reminders that sophisticated computer models used to predict the future are useless in the face of the unpredictable. Instead of seeking a false assurance in the models, it’s better to prepare, to the extent possible, to weather any storm Mother Nature or man dishes up.

Black swans are “large-scale, unpredictable and irregular events of massive consequence,” as defined by the author who popularized the term in a 2007 book. Given their unpredictability, says Nassim Nicholas Taleb, the solution cannot lie in developing better predictive methods....Robust policy – such as sustainable public finances or effective bank regulations – must be designed to withstand black swans.
Konrad_Yakabuski  forecasting  weather  public_policy  reminders  modelling  unpredictability  assumptions  antifragility  Nassim_Taleb  black_swan  resilience  risk-management  policymaking 
january 2015 by jerryking
2014’s lessons for leaders: Don’t make assumptions, do make hard decisions - The Globe and Mail
BOB RAE
Special to The Globe and Mail
Published Friday, Dec. 26 2014,

Life has a way of lifting you by the lapels and giving you a good shake. Stuff happens, and when it does, it can throw all the steady paths predicted by pundits, pollsters and economic forecasters into the trash heap....Canadians are fixated on who the winners and losers of the "where will oil prices head" game ...but we need to lift our heads a bit. Russia’s falling ruble and the debt crisis of its elites and their companies have rightly grabbed headlines. But a couple of countries, notably Nigeria and Venezuela, are now in political crisis, and their very stability is at risk in the days ahead.

One of the implications of the 2008 world economic crisis is that regional and world institutions have much less room to manoeuvre and help sort things out. it will be harder for those agencies (EU, IMF) to do as much as is required. Stability doesn’t come cheap....a healthy dose of reality and skepticism is always a good idea. In a useful piece of advice, Rudyard Kipling reminded us that triumph and disaster are both imposters. People draw too many conclusions from current trends. They fail to understand that those trends can change. And that above all, they forget that events can get in the way....One clear lesson is for leaders everywhere to learn the importance of listening and engagement. The path to resolution of even the thorniest of problems...involves less rhetoric and bluster and a greater capacity to understand underlying interests and grievances. ... Engagement should never mean appeasement.
Bob_Rae  pundits  decision_making  leaders  unintended_consequences  predictions  WWI  humility  Toronto  traffic_congestion  crisis  instability  listening  engagement  unpredictability  Rudyard_Kipling  petro-politics  imposters  short-sightedness  amnesia_bias  interests  grievances  appeasement  hard_choices 
december 2014 by jerryking
Why strategy is dead in the water - The Globe and Mail
HARVEY SCHACHTER
Special to The Globe and Mail
Published Sunday, Nov. 16 2014

Old line discussions of "strategy" assumed that one's competitors today will be one's competitors forever. It also assumed that companies can control distribution and send out targeted marketing messages to prospects and customers. These days, competition can come at you from all directions – witness, for example, the many companies with which Amazon.com, once just a book seller, competes. Distribution is wild and woolly, and in an era of social media, companies no longer control the messages about their offerings.

“Control and predictability have been greatly diminished,”
Here are seven factors that prevent you from being classically strategic:

1. Incrementalism has been disrupted
2. Outcomes are unpredictable.
3. The past is no longer a predictor.
4. Competitive lines have been dissolved.
5. Information is abundant (i.e. the commoditization_of_information)
6. It hard to forecast value.
7. Fast trumps long-term.
fast-paced  commoditization_of_information  strategy  Michael_Porter  Harvey_Schachter  long-term  unpredictability  GE  IBM  data  information_overload  incrementalism  Amazon  kaleidoscopic 
november 2014 by jerryking
The Biology of Risk - NYTimes.com
By JOHN COATES JUNE 7, 2014

What is it about risk taking that so eludes our understanding, and our control?

Part of the problem is that we tend to view financial risk taking as a purely intellectual activity. But this view is incomplete. Risk is more than an intellectual puzzle — it is a profoundly physical experience, and it involves your body...Risk by its very nature threatens to hurt you, so when confronted by it your body and brain, under the influence of the stress response, unite as a single functioning unit....The state of your body predicts your appetite for financial risk just as it predicts an athlete’s performance.

If we understand how a person’s body influences risk taking, we can learn how to better manage risk takers. We can also recognize that mistakes governments have made have contributed to excessive risk taking.

Consider the most important risk manager of them all — the Federal Reserve. ...Uncertainty over the timing of something unpleasant often causes a greater challenge response than the unpleasant thing itself. Sometimes it is more stressful not knowing when or if you are going to be fired than actually being fired. Why? Because the challenge response, like any good defense mechanism, anticipates; it is a metabolic preparation for the unknown....Most models in economics and finance assume that risk preferences are a stable trait, much like your height. But this assumption, as our studies suggest, is misleading. Humans are designed with shifting risk preferences. They are an integral part of our response to stress, or challenge....One such opportunity is a brief spike in market volatility, for this presents a chance to make money. But if volatility rises for a long period, the prolonged uncertainty leads us to subconsciously conclude that we no longer understand what is happening and then cortisol scales back our risk taking. In this way our risk taking calibrates to the amount of uncertainty and threat in the environment.

Continue reading the main story
Under conditions of extreme volatility, such as a crisis, traders, investors and indeed whole companies can freeze up in risk aversion, and this helps push a bear market into a crash. Unfortunately, this risk aversion occurs at just the wrong time, for these crises are precisely when markets offer the most attractive opportunities, and when the economy most needs people to take risks. The real challenge for Wall Street, I now believe, is not so much fear and greed as it is these silent and large shifts in risk appetite....As uncertainty in fed funds declined, one of the most powerful brakes on excessive risk taking in stocks was released....There are times when the Fed does need to calm the markets. After the credit crisis, it did just that. But when the economy and market are strong, as they were during the dot-com and housing bubbles, what, pray tell, is the point of calming the markets? Of raising rates in a predictable fashion? If you think the markets are complacent, then unnerve them. Over the past 20 years the Fed may have perfected the art of reassuring the markets, but it has lost the power to scare. And that means stock markets more easily overshoot, and then collapse.

CONTINUE READING THE MAIN STORY
120
COMMENTS
The Fed could dampen this cycle. It has, in interest rate policy, not one tool but two: the level of rates and the uncertainty of rates. Given the sensitivity of risk preferences to uncertainty, the Fed could use policy uncertainty and a higher volatility of funds to selectively target risk taking in the financial community....IT may seem counterintuitive to use uncertainty to quell volatility. But a small amount of uncertainty surrounding short-term interest rates may act much like a vaccine immunizing the stock market against bubbles. More generally, if we view humans as embodied brains instead of disembodied minds, we can see that the risk-taking pathologies found in traders also lead chief executives, trial lawyers, oil executives and others to swing from excessive and ill-conceived risks to petrified risk aversion. It will also teach us to manage these risk takers, much as sport physiologists manage athletes, to stabilize their risk taking and to lower stress.
Wall_Street  risks  risk-management  risk-taking  uncertainty  U.S._Federal_Reserve  bubbles  volatility  behavioural_economics  risk-preferences  risk-aversion  biology  psychology  interest_rates  emotions  human_experience  human_behavior  human_frailties  human_psyche  financial_risk  signaling  stress_response  market_crash  immobilize  paralyze  bear_markets  policy_tools  physiological_response  risk-appetite  unpredictability  physical_experiences  calibration 
june 2014 by jerryking
A fresh approach to growth
October 13, 2010

In Canada, fresh-cut fruits and vegetables and packaged salads represent nearly 20% of the total produce available in grocery stores. The industry is worth an estimated $14 billion a year in North America.

“Perishable commodities are as unpredictable as the stock market,” Karr says. “It’s a complex business because there are so many variables that are impossible to control, such as weather and growing conditions. In my world, you always need a contingency plan.”
fresh_produce  Canada  entrepreneur  salads  OPMA  fruits  vegetables  perishables  commodities  unpredictability  weather  contingency_planning  grocery 
february 2013 by jerryking
Class notes from a course on the age of complexity
Dec. 24, 2012 | The Financial Times p8.|by John Lloyd.

Now some have developed an anxiety about muddling through, and the lack of strategic thinking among leaders in public life.

General Sir David Richards, head of the British armed forces, recently stressed the need for long-range thinking about the world's unpredictability. Conflict in the Middle East, the rise of China, the slowing of Europe, fierce competition for raw materials, demographic shifts, terrorism and international crime are only some of the vast challenges he sees.

The UK public administration select committee, which scrutinises how the government is run, produced a report in April called Strategic Thinking on Government , in which it declared "we have little confidence that government policies are informed by a clear, coherent, strategic approach".
United_Kingdom  strategic_thinking  public_sector  long-range  unpredictability  globalization  Colleges_&_Universities  executive_education  complexity  LSE  long-term  from notes
december 2012 by jerryking
Whatever the weather
Nov. 24, 2012 | The Financial Times News: p10.|Gillian Tett who interviews Nassim Nicholas Taleb

Until now, Taleb says, modern society has generally assumed that people, systems or institutions fell into two camps: either they were fragile (and likely to break when shocks occur) or robust (and thus able to resist shocks without being impacted at all). Taleb insists there is a third category of people, institutions and systems that are resilient in a way we have been unable to articulate: they survive shocks not because they are immovable but precisely because they do change, bending in the face of stress; adapting and learning. This is the quality that he describes as "antifragile". (In the US the book is being published with the rather more explicit subtitle "Things that Gain from Disorder".)

Taleb goes on to explain how this works: while nation-states tend to be fragile (because they are highly dependent on one vision of the nation), city-states tend to be antifragile (because they can adapt and learn from history). Careers that are based on one large employer can be fragile but careers that are flexible and entrepreneurial are antifragile, because they can move with changing times. Similarly, the banking system is fragile, while Silicon Valley is antifragile; governments that are highly indebted are fragile, while those (such as Sweden) which have learnt from past mistakes and refuse to assume too much debt are antifragile. And Switzerland is presented as one of the most antifragile places of all, partly because its decentralised structure allows for plenty of experimentation...Taleb has plenty of advice to offer us on how to become more antifragile. We should embrace unpredictable change, rather than chase after an illusion of stability; refuse to believe anyone who offers advice without taking personal risk; keep institutions and systems small and self-contained to ensure that they can fail without bringing the entire system down; build slack into our lives and systems to accommodate surprises; and, above all, recognise the impossibility of predicting anything with too much precision. Instead of building systems that are excessively "safe", Taleb argues, we should roll with the punches, learn to love the random chances of life and, above all, embrace small pieces of adversity as opportunities for improvement. "Wind extinguishes a candle and energises a fire," he writes. "Likewise with randomness, uncertainty, chaos, you want to use them, not hide from them."
adaptability  adversity  antifragility  books  chaos  city-states  Gillian_Tett  illusions  Nassim_Taleb  overcompensation  personal_risk  randomness  resilience  scheduling  self-contained  skin_in_the_game  slack_time  surprises  trauma  uncertainty  unpredictability 
november 2012 by jerryking
Antifragile
by Taleb, Nassim Nicholas.
Year/Format: 2012

Just as human bones get stronger when subjected to stress and tension, and rumors or riots intensify when someone tries to repress them, many things in life benefit from stress, disorder, volatility, and turmoil. What Taleb has identified and calls “antifragile” is that category of things that not only gain from chaos but need it in order to survive and flourish.

In The Black Swan,Taleb showed us that highly improbable and unpredictable events underlie almost everything about our world. In Antifragile, Taleb stands uncertainty on its head, making it desirable, even necessary, and proposes that things be built in an antifragile manner. The antifragile is beyond the resilient or robust. The resilient resists shocks and stays the same; the antifragile gets better and better.

Furthermore, the antifragile is immune to prediction errors and protected from adverse events. Why is the city-state better than the nation-state, why is debt bad for you, and why is what we call “efficient” not efficient at all? Why do government responses and social policies protect the strong and hurt the weak? Why should you write your resignation letter before even starting on the job? How did the sinking of theTitanicsave lives? The book spans innovation by trial and error, life decisions, politics, urban planning, war, personal finance, economic systems, and medicine. And throughout, in addition to the street wisdom of Fat Tony of Brooklyn, the voices and recipes of ancient wisdom, from Roman, Greek, Semitic, and medieval sources, are loud and clear.

Antifragile is a blueprint for living in a Black Swan world.
antifragility  Black_Swan  blueprints  bones  bone_density  books  brittle  city-states  disorder  improbables  libraries  Nassim_Taleb  revenge_effects  stressful  tension  turmoil  unpredictability  volatility 
november 2012 by jerryking
History Doesn't Follow the Rules
200X | TIME | Jeff Greenfield
The world can change in a day, all right, but not always the way we think it will. LOOKING FOR A LESSON IN HUMILITY? STAND AT A MAJOR historical marker, and try drawing a perfectly reasonable, prudent conclusion about where that marker is pointing.

...revised views of history are what keep successive generations of historians in business, continuously updating where the latest dominoes have fallen. Eighty years from now, scholars will still be debating the meaning of what happened 80—or even 800—years ago. We journalists like to say that journalism is the first rough draft of history—a mere acknowledgment, perhaps that there is a Higher Authority in whose hands rests the final draft.
history  unpredictability  humility  seminal_moments  historians  worthiness  journalists  journalism 
august 2012 by jerryking
Leadership Lessons From the Shackleton Expedition - NYTimes.com
By NANCY F. KOEHN
Published: December 24, 2011

Consider just a handful of recent events: the financial crisis of 2008; the gulf oil spill of 2010; and the Japanese nuclear disaster, the debt-ceiling debacle and euro crisis this year. Constant turbulence seems to be the new normal, and effective leadership is crucial in containing it.

Real leaders, wrote the novelist David Foster Wallace, are people who “help us overcome the limitations of our own individual laziness and selfishness and weakness and fear and get us to do better, harder things than we can get ourselves to do on our own.”

Shackleton exemplified this kind of leadership for almost two years on the ice. What can we learn from his actions?...Shackleton begun the voyage with a mission of exploration, but it quickly became a mission of survival.

This capacity is vital in our own time, when leaders must often change course midstream — jettisoning earlier standards of success and redefining their purposes and plans.
uncertainty  unpredictability  leadership  expeditions  explorers  historians  lessons_learned  pivots  turbulence  constant_change  leaders  human_frailties  course_correction  arduous  Antartica  South_Pole  Ernest_Shackleton  new_normal 
december 2011 by jerryking
Crovitz: Tsunamis of Information - WSJ.com
MAR. 21, 2011 |WSJ| L. GORDON CROVITZ. Hayek spoke of the
'pretense of knowledge,' and why disasters are worse than expected. In
this information-saturated era, we expect no surprises. Yet we are
constantly surprised. We have huge amounts of data, so we assume that
risks can be calculated & avoided. But we also have exceedingly
complex systems. Just as weather is too hard to predict more than a few
days out because of how many variables interact, it's hard to predict
other complex systems. Consider credit instruments during the financial
crisis, the global warming debate, or global epidemics. Thus an
earthquake & tsunami, even in technologically advanced Japan, can
kill tens of thousands, wipe out entire villages, & re-open
questions about nuclear power....some physical systems turn out to be so
complex that they resemble unpredictable social sciences more than the
certainties of simpler physical science....We need to learn how to live
with both new technologies & new uncertainties.
disasters  complexity  Friedrich_Hayek  L._Gordon_Crovtiz  natural_calamities  information_overload  data  uncertainty  surprises  overconfidence  pretense_of_knowledge  earthquakes  tsunamis  social_sciences  certainty  psychology  unpredictability  compounded  risk-assessment  physical_systems  CDOs 
march 2011 by jerryking
FT.com / Life & Arts - Lightning in a bottle
October 30 2010 | Financial Times | By Steven Johnson. The
physical density of the city also encourages innovation. Many start-ups,
both now and during the first, late-1990s internet boom, share offices.
This creates informal networks of influence, where ideas can pass from
one company to the other over casual conversation at the espresso
machine or water cooler....By crowding together, we increase the
likelihood of interesting ideas or talents crossing the companies’
borders. The proximity also helps to counter the natural volatility of
start-ups...Economists have a telling phrase for the kind of sharing
that happens in these densely populated environments: “information
spillover.” When you share a civic culture with millions of people, good
ideas have a tendency to flow from mind to mind, even when their
creators try to keep them secret....The musician and artist Brian Eno coined the odd but apt word “scenius” to describe the unusual pockets of group creativity and invention that emerge in certain intellectual or artistic scenes: philosophers in 18th-century Scotland; Parisian artists and intellectuals in the 1920s. In Eno’s words, scenius is “the communal form of the concept of the genius.” New York hasn’t yet reached those heights in terms of internet innovation, but clearly something powerful has happened. There is genuine digital-age scenius on its streets. This is good news for my city, of course, but it’s also an important case study for any city that wishes to encourage innovative business. How did New York pull it off?
ideas  creativity  innovation  cities  cross-pollination  urban  idea_generation  scenius  Steven_Johnson  proximity  information_spillover  unpredictability  serendipity  collaboration  densification  ideaviruses  volatility  network_density  start_ups 
october 2010 by jerryking
Technology Is Central To CIA's Strategic Plan - WSJ.com
APRIL 26, 2010 | Wall Street Journal | By SIOBHAN GORMAN.
The CIA announced a five-year strategic plan that would invest heavily
in new technologies to combat non-traditional threats like cyber attacks
from overseas and gain better intelligence on rogue states like Iran.
... Mr. Panetta released his five-year plan in remarks to agency
employees. "We govern either by leadership or by crisis," he said.
"That's why we're taking a hard look at future challenges, and what we
want our agency to look like five years from now."
threats  adaptability  instability  unpredictability  rogue_actors  security_&_intelligence  CIA  strategic_planning  cyber_warfare  asymmetrical  Iran  Africa  Pakistan  innovation  Pentagon  forward_looking  leadership  strategic_thinking  decentralization  non-traditional  technology  Leon_Panetta 
may 2010 by jerryking
Corruption You Can Count On --- Crooked governments don't inevitably kill an economy; Trouble emerges when the rules of the game are unpredictable
3 April 2010 | Wall Street Journal | By Raymond Fisman.
Raymond Fisman is professor of economics and director of the Social
Enterprise Program at the Columbia Business School. He is author, with
Edward Miguel, of "Economic Gangsters."
corruption  economic_development  LDCs  Zimbabwe  China  Suharto  Indonesia  developing_countries  rules_of_the_game  unpredictability 
april 2010 by jerryking
The Culture of Today’s Changing World
May/June 2009 | Departures | By Joshua Cooper Ramo. From
Hezbollah in Beirut to a investment fund in Beijing, we’re living in an
age of unthinkable change and surprise. "In a world of constant newness
in science, technology, and media, there’s no reason to think politics
and economics should be immune to change any more than the way we search
for information is. If we truly want to develop a sense of the unstable
geography at this moment and master the suddenly essential language of
surprise and hope and danger, our only chance is to get out of the house
(or the bunker) and start looking for signs of the new. Travel,
tourism, and culture instantly become more than hobbies or distractions;
they are transformed into our best hope of understanding. Because while
we are now indisputably living in the age of the unthinkable, it
doesn’t mean we’re living in the age of the unexplainable."
Joshua_Cooper_Ramo  globalization  dangers  politicaleconomy  instability  unpredictability  travel  tourism  culture  surprises  constant_change  sense-making  unthinkable 
january 2010 by jerryking
Talking to...Joshua C. Ramo
POSTED ON: APRIL 14, 2009 | TORO MAGAZINE | POSTED BY:
SALVATORE DIFALCO. "...Get over this idea that we can deter or regulate
threats out of existence. Most of the big threats we can’t deter. Our
efforts to deter terrorism haven’t been all that effective. Some of
those guys are all too happy to die. The challenge is for us to build a
society that accepts these shocks as part of the system."
Joshua_Cooper_Ramo  uncertainty  instability  threats  interviews  unpredictability  deterrence  complexity  Kissinger_Associates  resilience 
september 2009 by jerryking
Hezbollah as 'a hot cell for innovation'Why our intentions 'don't just fail, they backfire'
Apr 19, 2009 | Toronto Star | Lynda Hurst.

we're still using anachronistic ideas to hold together a global order that no longer exists. A revolution is in progress where the unthinkable all too readily becomes the inevitable.

The result? More – and more dangerous – reversals of intent and outcome.

"What's happening today is that our intentions don't just fail, they backfire on us," says the Beijing-based geo-strategy analyst. "We deliver the opposite of what we intend because we so misunderstand the way the system now works."

The "war on terrorism" creates even more terrorists. The attempt to build a risk-proof financial system produces more risks than anyone is able to foresee. The bid to spread capitalism across the globe widens the chasm between rich and poor. The effort to contain nuclear proliferation leads to rogue states such as North Korea and Iran playing gimme-gimme games (or maybe not) with the final option.

Think Mikhail Gorbachev setting out only to reform the Soviet Union, but instead triggering its downfall, which in turn leads the U.S. to conclude its values have won the Cold War. Not so, Ramo says. Or George W. Bush reckoning he can inject democracy into Iraq and, presto, out comes peace: "Absurd in the extreme."

The new rules are
still being formed. They will be based on one central premise: countless
variations in the scheme of things will continue to occur at warp
speed, and adapting to them equally as quickly will be crucial. The
unpredictable demands of constant newness can immobilize institutions,
however, not just individuals. It can blind them to unsprung traps,
freeze once-honed navigation skills. The structure of the U.S. State
Department has barely changed since the end of World War II.

Governments can't prepare for everything in the future, but they can
build resilience into their systems. Real power will be the ability to
come back strong after an unexpected shock. That will mean persistently
assessing the big picture, not just its component pieces.
new_normal  uncertainty  Joshua_Cooper_Ramo  geopolitics  unpredictability  resilience  21st._century  adaptability  managing_uncertainty  Hezbollah  unintended_consequences  unexpected  political_power  accelerated_lifecycles  U.S._State_Department  immobilize  paralyze  constant_change  revenge_effects  rogue_actors  unthinkable  misunderstandings  Cambrian_explosion  iterations  Octothorpe_Software  Mikhail_Gorbachev  the_big_picture  warp_speed  financial_system 
may 2009 by jerryking
Psychology Today: The Laws of Urban Energy
July/August 2007| Psychology Today | Anya Kamenetz
The world is flatter than ever. But while technology may give us each
the tools of creativity, it takes urban proximity and unpredictability
to sharpen them. One's mental garden buds, blooms, and proliferates when
cross-pollinated with the many other flowers and fruits crowding the
urban jungle. People come up with more and better ideas and produce more
results from those ideas by finding more collaborators as well as
critics.

By: Anya Kamenetz
cities  creativity  economics  urban  community  idea_flows  idea_generation  inspiration  cross-pollination  Anya_Kamenetz  playing_in_traffic  prolificacy  proximity  psychology  unpredictability  serendipity  collaboration  information_spillover  densification 
april 2009 by jerryking

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