We frequently hear the expression "skin in the game," but we almost ever take the time to really think about it. It is the basis of risk management, but it’s also an astonishingly rich worldview that, as Taleb shows in this book, applies to all aspects of our lives. As Taleb states, "Never trust anyone who doesn't have skin in the game," and "The symmetry of skin in the game is a simple rule that's necessary for fairness and justice, and the ultimate BS-buster." Without it, fools and crooks will benefit, and their mistakes will never come back to haunt them.”

Skin In The Game - The Hidden Asymmetries of Life

Nassim Nicholas Taleb's book, The Black Swan, challenges many beliefs about risk, reward, politics, religion, finance, and personal responsibility. He cites examples from various historical figures and emphasizes the importance of accepting one's own risks for social justice. Taleb suggests that for social justice, focus on symmetry and risk sharing, as it is essential to own one's own risk and pay for losses. He also argues that ethical rules aren't universal and that minorities run the world. He also warns against being an intellectual but an idiot, warns against complicated solutions, and emphasizes that true religion is commitment rather than faith. The phrase "skin in the game" is a key principle in risk management and applies to all aspects of life.

This book focuses on identifying and filtering out superficial expertise, emphasizing the importance of genuine experience over mere appearances. It contrasts various concepts such as action versus cheap talk, practice versus theory, and ethical versus legal considerations. The author advocates for accountability and risk-taking in decision-making, arguing that those without "skin in the game" should not influence outcomes. The text critiques modern bureaucracy and the disconnect between decision-makers and the consequences of their actions. It highlights the value of learning through experience, the pitfalls of specialization, and the need for authenticity in endeavors. Ultimately, it suggests that societal progress is driven by a minority willing to take risks, rather than by consensus.

41 curated insights of Nassim Nicholas Taleb from his book, Skin In The Game - The Hidden Asymmetries of Life

1. This book is all about bull shit identification and filtering.
2. Difference between Cosmetic vs Real Expertise.
3. Don't tell me what you 'think' - just tell me what's in your portfolio.
4. This book is also about - How much information you should practically share with others.
5.  If you are paying a penalty when things go wrong, you have put skin in your game.
6. This book is not all endlessly justifying anything. It is only taking us in non-linear fashion, building surprises. Not saying anything obvious is making it an adventure in itself.
7. Action Vs Cheap talk
   • Consequence vs Intention
   • Practice vs Theory
   • Honor vs Reputation
   • Ethical vs Legal
   • Genuine vs Cosmetic
   • Entrepreneur vs CEO
   • Authors vs Editors
   • Quality vs Advertising
   • Understanding the subtle yet powerful differences between these.
8. Guide your learning through pain - the knowledge we get through tinkering, trial and error, experience and the workings of time is vastly superior to that obtained through reasoning, something self-serving institutions have been busy hiding from us.
9. When you hear someone invoking abstract modernistic notions, you can assume that they got some education (but not enough, or in some wrong discipline) and have too little accountability.
10. Those who don't take risks should never be involved in making decisions.
11. Societies were always run by risk takers, not risk transferors.
12. Even today, monarchs derive their legitimacy from a social contract that requires physical risk-taking. Because noblesse oblige.
13. Bureaucracy is a construction by which a person is conveniently separated from the consequences of his or her actions.
14. Decentralise or localise the system to directly expose the cost of errors to the decision makers, not making them immune to it.
15. You will never fully convince someone that he is wrong; only reality can.
16. The curse of modernity is that we are increasingly populated by a class of people who are better at explaining than understanding, or better at explaining than doing.
17. Hammurabi's best known injunction: If a builder builds a house and house collapses and causes the death of the owner of the house - the builder shall be be put to death.
18. Universal behaviour is great on paper, disastrous in practice.
19. Avoid taking advice from someone who gives advice for a living, unless there is a penalty for their advice.
20. You do not want to win an argument. You want to win.
21. What matters in life is isn't how frequently one is "right" about outcomes, but how much one makes when one is right.
22. The rule is: Those who talk should do and only those who do should talk.
23. Architects today build to impress other architects, and we end up with strange - irreversible - structures that do not satisfy the well being of their residents.
24. Specialisation comes with side effects, one of which is separating labour from fruits of labour.
25. Things designed by people without skin in the game tend to grow in complication (before their final collapse).
26. Skin in the game makes boring things less boring.
27. If you do not take risks for your opinion, you are nothing.
28. Having an assistant (except for the strictly necessary) removes your soul from the game.
29. Assistance moves you one step away from authenticity.
30. Entrepreneurs are heroes in our society. They fail for the rest of us.
31. The skills at making things diverge from those at selling things.
32. If you can't put your soul into something, give it up and leave that stuff to someone else.
33. The reading of a single text twice is more profitable than reading two different things once, provided it has depth of content.
34. One lauds merrily the merchandise to get rid of it.
35. Laws come and go. Ethics stay.
36. Tragedy of commons - we keep our private gardens far cleaner than our public parks. Individual interests outbeat collective interests always.
37. Studying individual ants will almost never give us an indication of how an ant colony operates.
38. A vegetarian will never eat non-vegetarian food. But a non-vegetarian can eat vegetarian.
39. On a highway ride, McDonald's appears to be a safe bet. It is also a safe bet in shady places. You may hate McDonald's, but we certainly hate uncertainty even more!
40. Society doesn't evolve by consensus or majority, only a few people are sufficed to disproportionately moving the needle.
41. Revolutions are unarguably driven by an obsessive minority.

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