Antifragile: Things That Gain from Disorder
by: Nassim Nicholas Taleb
Fragile things break under stress, while Antifragile things get stronger as resistance is applied. Risk averse humans tend to build risk management structures that are Fragile, often creating a false sense of security.
In Nassim Taleb’s central piece as part of The Incerto, he defines his central theme of “Antifragility”. Taleb abstractly articulates the power of a market to adapt and absorb risk. Today’s risk manager can be well served to look above the procedure and reporting fray in order to understand the risks inherent to financial services structures.
Essentially, Taleb likes to argue that markets respond well to small stressors. Adversity serves a great purpose in fueling adaptation and evolution. If things are built in an Antifragile manner, they become immune to prediction errors and better responsive to adverse events. Antifragile presents a blueprint for decision making under opacity and a roadmap to living in a world filled with uncertainty.