Hitler was as much a "socialist" as the German Democratic Republic (communist East Germany) was democratic

Let me just wade in here again and point out that it is historically correct to state that Hitler's party began with a socialist element but this was largely liquidated and its remnants hunted down and destroyed after the Night of the Long Knives.  Hitler was a master at getting people to act against their interests, playing on worker's discontent by channeling their fury toward a fictitious international Jewish conspiracy; many workers were anamored of anti-semitic nonsense before Hitler actually became very anti-semitic himself (believe it or not, there were a number of contemporaries from his failed artist days who never remember him as being anti-semitic then, and his family doctor and a man who helped sell some of his art work was Jewish (and this never was raised as any sort of issue)).  My point is that Hitler was nothing if not a cunning exploiter, seeing which way the popular rage was blowing and taking advantage of it.  When it was in his interests to be seen as a champion of the working man and the unions, he modeled himself this way (although virtually all parties did - there were no equivalent of the Republican party today that distances itself from workers and their interests while espousing faux-populist nonsense).  But his true backers were the large German industrialist families who had much to gain by having a reliable business-friendly government who halfway through his rise to power made sure that unions were not going to be a problem for all those lucrative war contracts that would be handed out by his regime.  In fact, all non-Nazi unions were banned, so he could continue the fiction (to anyone who ignored the disappearance of the labor leaders and the purging of the left from his party) that he was living up to the "socialist" part of national socialist.
When one considers that much of the Nazi war machine was fueled by slave labor provided first by Russian POWs then by Jews, intellectuals, and dissidents of every stripe, it is impossible to make the case that Hitler was a worker-friendly leftist.
Those who claim Hitler was a leftist may not realize they are taking Nazi propaganda at face value and playing right into his legacy (he certainly would welcome that sort of revisionist softening of his murderously anti-worker, anti-human being, right-wing regime).  But it makes no more sense to say that socialism is always and everywhere bad because Hitler called himself a national socialist anymore than it would make sense to say that Democracy is always bad because East Germany called itself the German Democratic Republic!

Raid the pensions of Wall Street executives who created this economic and financial crisis, not our teachers

Attacking our teachers is like eating our seed corn. It is mean-spirited and frankly stupid. A good teacher is worth far more to society than a great bond trader, but a mediocre bond trader makes as much in a few weeks as a senior teacher makes in a year. 
Someone on CNN I believe flashed a figure of $52k for the average teacher compensation in Ohio. I was shocked - that it was so low. I am sure many bond traders and investment bankers would not get out of bed for such chump change; to begrudge this investment in our children's future is disproportionate and misdirected. 
Ohio is in trouble not because the unions demanded their members get a compensation package that included a decent retirement after a lifetime of service, but that the pension funds - at the urging of the current governor!! - were invested in the fraudulent mortgage-backed securities those highly paid Wall Street executives peddled on the rest of the world. Blaming the unions for massive Wall Street fraud (perpetrated by self-important MBAs whose compensation amazingly has rarely surfaced as an issue in all of this belt-tightening - we seem to be outraged a chemistry teacher makes $50k a year and will not have to eat cat food in retirement, but the idea that an investment firm's CEO receives tens of millions in dollars in compensation (and that much of that money can be traced directly to taxpayer largesse through the Bush-Paulson bailout) makes hardly a dent in anyone's budget projections). 
I am not a Marxist by a long stretch, but the older I grow and the more of this crap I see, the more I think he was on to something. The owners of capital cannot be trusted absolutely anymore than those heading government bureaucracies. The difference is that the former regularly steal tens of millions from their workers, shareholders, and all of us. They should be ashamed. 
If we wanted to really balance the budget we could raid the pensions and compensation pools for Goldman and Citigroup. They blew up our system and they, not teachers, should pay.

Miracle in the Andes by Nando Parrado - Excerpts

Miracle in the Andes  

Nando Parrado with Vince Rause

Selected Excerpts

   Outstanding.  If you liked Alive you will love this book, which reflects 30 years of meditation on the meaning of what he went through, as told from the first person perspective of one of the two survivors who walked 10 days to save his life and that of the 14 survivors waiting behind at the fuselage.  Absolutely hands down the greatest survival story I have ever encountered.  Shackleton's comes close, and in some ways deserves the nod because no one perished thanks to extraordinary leadership, perseverance, and luck, but Shackleton's Antarctic expedition was a well-supplied group of volunteers who knew what they were getting in for.  Surviving a plane crash in street clothes then walking out in those same clothes, climbing a mountain experienced mountain climbers with full gear would find treacherous and demanding, THAT is astonishing.  

  I am particularly grateful for Nando Parrado's reflections on the meaning of his experience and how this shaped his view of God and his role in the universe.  Scroll down to the final passages excerpted below for those reflections.  They are quite moving in their simplicity and honesty.  

45 people were on board including 

    4 crew members - pilot, copilot, mechanic, and steward

16 survived

After the crash:

"I am alive," I whispered to [my father], "I am alive."  -40

Few of us had ever seen snow.  None of us had ever set foot in the mountains.  -41

I could not help myself from being swept away by the awesome grandeur all around us. There was incredible beauty here -- in the hugeness and power of the mountains, in the windswept snowfields that glowed so perfectly white, and in the astounding beauty of the Andean sky. As I looked up now, the sky was cloudless, and it crackled with an iridescent shade of cold, deep blue. It's eerie beauty left me awestruck, but like everything else here, the vastness and emptiness of that endless sky made me feel small and lost and impossibly far from home. In this primeval world, with its crushing scale, its lifeless beauty and its strange silence, I felt awkwardly out of joint with reality in the most fundamental sense, and that scared me more than anything, because I knew in my gut that our survival here would depend on our ability to react to challenges and catastrophes we could not now even imagine. We were playing a game against an unknown and unforgiving component. The stakes were terrible -- play well or die -- but we didn't even know the ground rules. -51

Because I blacked out in the earliest stages of the accident, I had no recollection of anything until I came to my senses three days later. But most of the other survivors had been conscious for every second of the disaster, and as they recounted the details of the crash, and the desperate days that followed, I realized it was a miracle that any of us were alive.-51

[when the plane struck the mountain] it landed on its belly and began to rocket down the snow-covered mountainside like a toboggan.   Passengers screamed and prayed out loud as the fuselage raced down the slope at a speed of 200 mph for a distance of more than 400 yards, finding a fortunate path between the boulders and rocky outcrops that studded the mountain befor slamming into a huge snow berm and coming to a sudden, violent stop.  The forces of the collision were huge. The Fairchild's nose was crumpled like a paper cup. In the passenger cabin, seats were ripped loose from the floor of the fuselage and hurled forward along with the people sitting in them, and dashed against the cockpit bulkhead.  -53

We had crashed at 3:30 in the afternoon. He guessed it would be four o'clock before officials could confirm that the plane was missing. -57

45 passengers and crew members had been onboard the Fairchild. There were five known dead at the crash site.

8  were unaccounted for, although the survivors felt certain that one of them, Carlos Valeta, was dead.

32 people [were left] alive at the crash site. -59

Liliana Methol was the only uninjured one survivor…  the rest packed into a cramped space on the litter strewn floor of the fuselage that measured no more than 8 x 10' square.  -59

45 -- 32 -- 29 (day three)

The youngest survivor was 17; the oldest was 38.  -62

I wanted so badly to trust in God as they did. But God had already taken my mother and Pacheco and so many others. Why would he save us and not them in the same way, I wanted to believe rescue was coming, but I could not chase away the gnawing sense that we were on our own… No one will find this. We will die here. We must make a plan. We must save ourselves.  -65

We dragged [my sister] Suzy to a spot in the snow to the left of the fuselage of the other dead were buried. Frozen corpses were clearly visible, their faces obscured by only a few inches of ice and snow. I stood above one of the graves, and easily made out a hazy shade of my mother's blue dress. I dug a shallow grave for Suzy next to my mother…

After we finished, the others walked back inside the fuselage. I turned and looked up the slope of the glacier, to the ridges of mountains blocking our path to the west. I could see the wide path the Fairchild had cut into the snow as it skied down the slope after clipping the ridge.... How could this happen? We were boys on our way to play a game! 

Suddenly I was struck by a sickening sense of emptiness. Since my first moments on the mountain I had spent all my time and energy caring for my sister. Comforting her had given me purpose and stability. It had filled my hours and distracted me from my own pain and fear. Now I was so terribly alone, with nothing to distance me from the awful circumstances that surrounded me. My mother was dead. My sister was dead. My best friends had fallen from the plane in flight, or were buried here beneath the snow. We were injured, hungry, and freezing. More than a week had passed, and still the rescuers had not found us. I felt the brute power of the mountains gathered around me, saw the complete absence of warmth or mercy or softness in the landscape. As I understood, with a stinging clarity, how far we were from home, I sank into despair, and for the first time I knew with certainty I would die. -71

I decided I would not quit. I decided I would suffer a little longer.... for a moment I felt [my father] with me. An eerie calmness settled over me. I stared at the great mountains to the west, and imagined a path leading over them and back to my home.... staring West, I made a silent vow to my father.  I will struggle. I will come home. I will not let the bond between us be broken. I promise you, I will not die here! I will not die here! -72

A past that was already beginning to feel distant and unreal. The mountains were forcing me to change. My mind was growing colder and simpler as it adjusted to my new reality. I began to see life as it must appear to an animal struggling to survive... my entire existence seemed to revolve around the two new organizing principles of my life: the chilling apprehension that I was going to die, and the searing need to be with my father....

it produced in me a manic urge to flee.  -77

Marcelo, a deeply devout Catholic, began to rely more and more upon the beliefs that had always shaped his life. "God loves us," he would say. "Only to turn his back on us and allow us to die needless deaths."... I wanted to believe in Marcelo so badly, but as time passed I could not silence the doubts that were growing in my mind. -77

After Suzy's death, 27 survivors remained. -80

Arturo was different from the rest of us. For one thing, he was a passionate socialist, and his uncompromising views of capitalism and the pursuit of personal wealth made him something of an oddball in the world of affluence and privilege in which most of us had been raised.... as I got to understand him a little, I began to admire his way of thinking.... what fascinated me about Arturo was the seriousness with which he lived his life and the fierce passion with which he had learned to think for himself. Important things matter to Arturo, matters of equality, justice, compassion, and fairness. He was not afraid to question any of the rules of conventional society, or to condemn our system of government and economics, which he believed served the powerful at the expense of the week.

Arturo's strong opinions bothered many of the others, and often led to angry arguments at night concerning history or politics or current affairs, but I always wanted to hear what Arturo had to say, and I was especially intrigued by his thoughts about religion. Like most of the other survivors, I had been raised as a traditional Catholic, and though I was no one's idea of a devout practitioner, I never doubted the fundamental teachings of the church. Talking with Arturo, however, forced me to confront my religious beliefs, and to examine principles and values I had never questioned.

"How can you be so sure that of all the sacred books in the world, the one you were taught to believe in is the only authentic word of God?" He would ask. "How do you know that your idea of God is the only one that's true? We are a Catholic country because the Spanish came and conquered the Indians here, then they replace the God of the Indians with Jesus Christ. If the Moors had conquered South America, we would all be praying to Mohammed instead of Jesus."

Arturo's ideas to start me, but his thinking was compelling. And it fascinated me that despite all his religious skepticism, he was a very spiritual person, who sensed my anger at God, and urged me not to turn away from him because of our suffering.

"What good is God to us?" I replied. "Why would he let my mother and sister dies so senselessly? If he loves us so much, why does he leave us here to suffer?"

"You are angry at the God you were taught to believe in as a child," Arturo answered. "The God who is supposed to watch over you and protect you, who answers your prayers and forgive your sins. This God is just a story. Religions try to capture God, but God is beyond religion. The true God lies beyond our comprehension. We can't understand his will; he can't be explained in a book. He didn't abandon us and his will will not save us. He has nothing to do with our being here. God does not change, he simply is. I don't pray to God for forgiveness for favors, I only pray to be closer to him, and when I pray, I fill my heart with love. When I pray this way, I know that God is love. When I feel that love, I remember that we don't need angels or a heaven, because we are a part of God already…. If you have the balls to doubt God, and to question all the things you have been taught about him, then you may find God for real. He is close to us, Nando, I feel him all around us. Open your eyes and you will see him, too."

I looked at Arturo, this ardent young socialista lying in his hammock with his legs broken like sticks and his eyes shining with faith and encouragement, and I felt a strong surge of affection for him. His words moved me deeply. How did such a young man come to know himself so well? Talking with Arturo forced me to face the fact that I had never taken my own life seriously.... I laughed sadly to myself, thinking, if there is a God, and if he wanted my attention, he certainly has it now. -85

no one in this awful place could be judged by the standards of the ordinary world. -89

The cold was always our greatest agony, and in the earliest days of the ordeal, the greatest threat we faced was thirst. At high altitude, the human body dehydrates five times faster than it does at sea level, primarily because of the low levels of oxygen in the atmosphere. To draw sufficient oxygen from the lead mountain air, the body forces itself to breathe very rapidly. This is an involuntary reaction often you can't just standing still. Increased inhalations bring more oxygen into the bloodstream, but each time you breathe then you must also breathe out, and precious moisture is lost each time you exhale. A human being can survive at sea level for a week or longer without water. In the Andes the margin of safety is much slimmer, and each breath brings you closer to death. -91

At high altitude, the body's core expertise are astronomical. A climber scaling any of the mountains surrounding the crash site would have required as many as 15,000 calories a day simply to maintain his current body weight. -94

Sometimes I would rise from a long silence to shout out loud in my frustration: "there is nothing in this fxxxing place to eat!"  But of course there was food on the mountain -- there was meat, plenty of it, and all in easy reach. It was as near as the bodies of the dead lying outside the fuselage under a thin layer of frost…  there are some lines, I suppose, that the mind is very slow to cross, but when my mind did finally cross that line, it did so with an in polls certain primitive it shocked me.... once that door had been opened, it couldn't be closed, and from that moment on my mind was never far from the frozen bodies under the snow. I knew those bodies represented our only chance for survival, but I was so horrified by what I was thinking that I kept my feelings quiet…

we all reached forward, joined hands, and pledge that if any of us died here, the rest would have permission to use our bodies for food…

eating the flesh did not satisfy my hunger, but it calmed my mind. I knew that my body would use the proteins strengthen itself and slow the process of starvation. That night, for the first time since the crash, I felt a small flickering of hope… we all knew our fight for survival would be uglier and more harrowing than we had imagined, but I felt, that as a group, we had made a declaration to the mountain that they would not surrender, and for myself, I knew that in a small, sad way, I had taken my first step back toward my father. -99

But then I understood: Marcello had been broken not because his mind was weak, but because it was too strong. His faith in the rescue was absolute and unyielding: God would not abandon us. The authorities would never leave us here to die.

When he heard the news that the search had been canceled, it must have felt to Marcello like the earth beneath his feet had begun to crumble. God had turned his back, the world has been turned upside down... I suddenly understood in that awful place, too much certainty could kill us; ordinary civilized thinking could cost us our lives. I vowed to myself that I would never pretend to understand these mountains. I would never get trapped by my own expectations. I would never pretend to know what might happen next. The rules here were too savage and strange, and I knew I could never imagine the hardships, setbacks, and horrors that might lie ahead. So I would teach myself to live in constant uncertainty, moment by moment, step by step. I would live as if I were dead already. With nothing to lose, nothing could surprise me, nothing could stop me from fighting; my fears would not block me from following my instincts, and no risk would be too great. -112

As the days passed, we became more efficient at processing the meat.... on the rare occasion when we had a fire they even cooked it, which improved its taste dramatically.... to make the food last even longer, we eventually began to eat the kidneys, livers, and even the hearts. These internal organs were highly nutritious, and as grisly as it may sound, by this point in the ordeal, most of us had grown numb to the horror of friends being butchered like cattle.

Still, eating human flesh never satisfied my hunger, and it never gave me back my strength. -118

But what did it matter I was a dead man already. Why not die in the mountains, fighting for each step, so that when I died, I would die one step closer to home? -119

One night something remarkable happened. It was after midnight, the fuselage was dark and cold as always, and I was lying restlessly in the shallow, groggy stupor that was as close as I ever got to genuine sleep, when, out of nowhere, I was jolted by a surge of joy so deep and sublime that it nearly lifted me bodily from the floor. For a moment the cold vanished, as if I'd been bathed in warm, golden light, and for the first time since the plane had crashed, I was certain I would survive. In excitement, I will be others.

"Guys, listen!" I cried. "We will be okay. I will have you home by Christmas!"

None of us had died since our eighth day on the mountain… we had passed the point of crisis. Things seemed more stable.... perhaps all 27 of us were destined to survive…-129

[October 29:  Avalanche.  Late at night, Nando spoke with Liliana, who lay next to him.]  "But why would God save us and let the others die?"…

"there is no way to understand God or his logic," she replied.

"Then why should we trust him?" I asked. "What about all the Jews who died in concentration camps?" I said "what about all the innocents killed in plagues and purges and natural disasters? Why would he turn his back on them, but still find time for us?"

De Leon aside, and I felt the warmth of her breath on my face. "You are getting too complicated," she said with softness in her voice. "All we can do is love God and love others and trust in God's will."…

[the avalanche struck]

At first the pressure in my chest was unbearable, but as my awareness dimmed, I stopped noticing the discomfort. My thoughts grew calm and lucid. "This is my death," I told myself. "Now I will see what lies on the other side." I felt no strong emotion. I didn't try to shout or struggle. I simply waited, and as I accepted my helplessness, a sense of peace overtook me. I waited patiently for my life to end. There were no angels, no revelations, there was no long time of leading to a golden loving light. Instead, I sensed only the same black silence I had fallen into when the Fairchild hit the mountain [and he was in a coma for three days]…

Javier was kneeling beside me, with Liliana in his arms. I knew from the way her arms and head hung limply but she was dead. I shook my head in disbelief as Javier began to sob. "No," I said flatly. "No." As if I could argue with what had just happened. As if I could refuse to allow it to be real…

Diego Storm, who, on the third day of the ordeal, had saved my life by dragging me into the warmth of the fuselage while I still lay in a coma, had suffocated under the snow. And Liliana, who, just moments earlier, had spoken such kind words of comfort to me, was also gone…

It is hard to describe the depths of the despair that fell upon us in the wake of the avalanche. The deaths of our friends staggered us. We have allowed ourselves to believe that we had passed the point of danger, but now we saw that we would never be safe in this place. The mountain could kill us in so many ways. But tortured me most was the capriciousness of death. How could I make sense of this? Daniel Maspons had been sleeping only inches to my right. Liliana had been just as close on my left. Both were dead. Why them and not me?  Was I stronger? Smarter?  Better prepared? The answer was clear: Daniel at Liliana wanted to live as much as I did, they were just as strong as they fought just as hard to survive, but their fate was decided by a simple stroke of bad luck -- they chose their spots to sleep that night, and that decision killed them. I thought of my mother and Suzy choosing their seats on the plane. I thought of Panchito switching seats with me just moments before the crash. The arbitrariness of all these deaths outraged me, but it frightened me, too, because if death here was so senseless and random, nothing, no amount of coverage or planning or determination, could protect me from it. -130-134

There were 19 of us now. -134

"Nando, I want you to remember, even in this place, our lives have meaning. Our suffering is not for nothing. Even if we are trapped here forever, we can love our families, and God, and each other as long as we live. Even in this place, our lives are worth living." Arturo's face was lit with a serene intensity when he said this. I kept my silence, for fear that my voice would crack if I tried to speak.

"You will tell my family that I love them, won't you? That's all that matters to me now."

"You will tell them yourself," I said.

Arturo smiled at the lie.   -149

Was there no rhyme or reason to our suffering? This one struggles bravely and is taken away, that one doesn't fight at all and still survives? Since the avalanche, some of the others had clung to the belief that God had seen 19 of us through that disaster because we were the ones he had chosen to survive. Rafael's passing made it harder to believe that God was paying any attention at all. -156

In the morning, I rested. The days I'd spent away from the Fairchild had given me perspective, and now I saw with fresh eyes the gruesomeness that had become a normal part of our daily lives. There were piles of bones scattered outside the fuselage. Large body parts -- someone's forearm, a human leg from head to toes -- were stored near the opening of the fuselage for easy access. Strips of fat were spread on the roof of the fuselage and dry in the sun. And for the first time I saw human skulls in the bone pile. When we first started eating human flesh, we consumed mostly small pieces of meat cut from the large muscles. But as time passed and the food supply diminished, we had no choice but to broaden our diet. For some time, we had been eating livers, kidneys, and hearts, but meat was in such short supply now that we would have to split skulls to get at the brains inside. -169

December 11, 1972 was day 60.

The crash site was an awful place, soaked in urine, smelling of death, littered with ragged bits of human bone and gristle, but to me it suddenly felt safe and warm and familiar. I wanted to stay there. How badly I wanted to stay.

"Nando," said Roberto, "it's time to go."…

we didn't know, for example, that the Fairchild's altimeter was wrong; the crash site wasn't at 7000 feet, as we thought, but close to 12,000. Nor did we know that the mountain we were about to challenge was one of the highest in the Andes, soaring to the height of nearly 17,000 feet, with slopes so steep and difficult they would test a team of expert climbers…. Uruguay was a warm and low-lying country. None of us had ever seen real mountains before. Prior to the crash, Roberto and Tintin had never even seen snow. If we had known anything about climbing, we'd have seen we were already doomed. Luckily, we knew nothing, and our ignorance provided our only chance. -185

Logic told us it would be wiser to climb in daylight, so we'd waited for the sun to rise. Experts, on the other hand, know that the best time for climbing is in the predawn hours, before the sun to turn the slopes to mush. -186

But something troubling was hiding behind all that beauty, something ancient and hostile and profound. I looked down the mountain to the crash site. From this altitude it was just a ragged smudge on the pristine snow. I saw how crass and out of place it seemed, how fundamentally wrong. Everything about us is wrong here -- the violence and racket of our arrival, our garish suffering, the noise and mess of our lurid struggle to survive. None of it fit here. Life did not fit here. It was all a violation of the perfect serenity that has reigned here for millions of years. I had sensed it the first time I gazed at this place: we had upset and ancient balance, and balance would have to be restored. It was all around me, in the silence, in the cold. Something wanted all that perfect silence back again; something in the mountain wanted us to be still. Space  -188

Experts recommend that climbers ascend no more than 1000 feet per day, a rate that gives the body a chance to acclimate itself to the thinning air. We had climbed twice that in a single morning, and were making matters worse by continuing to climb when our bodies desperately needed time to rest.   -189

The world was showing me how tiny I was, how weak and insignificant. And temporary. I listened to my own breathing, reminding myself that as long as I drew breath I was still alive. I promised myself I would not think of the future. I would live from moment to moment and from breath to breath, until I had used up all the life I had. -195

My life had collapsed to a simple game -- climb well and live, or falter and die -- and my consciousness had narrowed until there was no room in my thoughts for anything but a close and careful study of the rock I was reaching for, or the ledge on which I was about to brace my foot. Never had I felt such a sense of concentrated presence. Never had my mind experienced such a pure, uncomplicated sense of purpose…

I forgot myself in the intensity of my concentration, forgot my fears and fatigue, and for a while I felt as if everything I had ever been had disappeared, and that I was now nothing more than the pure will decline. It was a moment of pure animal exhilaration.

I had never felt so focused, so driven, so fiercely alive. For those astonishing moments, my suffering was over, my life had become pure flow. But those moments did not last.

 -196.

Death has an opposite, but the opposite is not mere living. It is not courage or faith or human will. The opposite of death is love. How had I missed that? How does anyone miss that? Love is our only weapon. Only love can turn mere life into a miracle, and draw precious meaning from suffering and fear. -201

We made each other better men… "I would rather walk to meet my death than wait for it to come to me."

Roberto nodded. "You and I are friends," he said. "We have been through so much. Now let's go die together." -203

Even in our battered state, we were awed by the wild beauty of the Andes after dark. The skies were the deepest indigo blue, and clustered with blazing stars. Moonlight softened the rugged peaks surrounding us, and gave the snowfields and eerie glow. -211

Slowly I let it sink in I was safe; I was going to go home. I drew a long breath and then slowly, richly, I exhaled. Breathe once more, we used to say on the mountain, to encourage each other in moments of despair. As long as you breathe, you are alive. In those days, each breath was almost an act of defiance. In my 72 days in the Andes, there had not been a single breath that wasn't taken in fear. Now at last, I enjoyed the luxury of ordinary briefing.... I am alive. I am alive. I am alive. -233

I realized that except for Javier, every one of my fellow survivors was returning to a life that was just as it had been before. Many of them had lost friends in the disaster, that was true, and all of them had injured an incredible nightmare, but now, for them, it was over. Their families were intact. They would be embraced again by their parents, brothers and sisters, girlfriends. Their world would begin again, and things would be just as they were before the crash interrupted their lives. But my world had been destroyed, and the party only underscored for me how much I had lost. I would never spend another Christmas with my mother, or with Suzy. It was clear to me that my father had been shattered by the ordeal, and I wondered if he would ever again be this man I had known. I tried to share in the celebration that night, but I felt very alone. -242

I saw my photograph on the mantle, arranged with photos of my mother and Suzy in a somber memorial. I glanced out the window. Cars were passing on the street. Lights were coming on in other houses where people were going on with their lives. This is how life would look if I had died, I thought. I did not leave a very big hole. The world has gone on without me. -247

There was no glory in those mountains. It was all ugliness and fear and desperation, and the insanity of watching so many innocent people die. -247

I think now that at the center of my soul there was a numbness, an emptiness, and I was trying to fill that emptiness with night after night of carousing. I was still denying the pain I had held inside me since the first days of the disaster. I was trying to find a safe way to feel. -250

I began to understand that my ordeal in the Andes was not an interruption of my true destiny, or a perversion of what my life was supposed to be. It simply was my life, and the future that lay ahead was the only future available to me. To hide from this fact, or to live in bitterness and anger, would only keep me from living any genuine life at all. Before the crash, I took so much for granted, but the mountains showed me that life, any life, is a miracle.... it was not the life I wanted or expected, but I understood that it was my duty now to live that life is richly and is hopefully as I could. I vowed to try. I would live with passion and curiosity. I would open myself to the possibilities of life. I would savor every moment, and I would try, every day, to become more human and more alive. To do any less, I understood, would be an insult to those who had not survived.... so I open myself to life, and, to my great fortune, my new life began to happen.

On Faith:

I deeply respect the faith of my friends, but, to be honest, as hard as I prayed for a miracle in the Andes, I never felt the personal presence of God. At least, I did not feel God as most people see him. I did feel something larger than myself, something in the mountains and glaciers and the glowing sky that, in rare moments, reassured me, and made me feel that the world was orderly and loving and good. If this was God, it was not God as a being or a spirit or some omnipotent, superhuman mind. It was not a God who would choose to save us or abandon us, or change in any way. It was simply a silence, wholeness, an awe inspiring simplicity. It seemed to reach me through my own feelings of love, and I have often thought that when we feel what we call love, we are really feeling our connection to this awesome presence.... I don't pretend to understand what it is or what it wants from me. I don't want to understand these things. I have no interest in any God who can be understood, who speaks to us in one holy book or another, and who tinkers with our lives according to some divine plan, as if they were characters in a play. How can I make sense of a God who sets one religion above the rest, who answers one prayer and ignores another, who sends 16 young men home in leaves 29 others dead in a mountain? …

Now I understand that to be certain -- about God, about anything -- is impossible. I have lost my need to know.In those unforgettable conversations I had with Arturo as he lay dying, he told me the best way to find faith was byhaving the courage to doubt. I remember those words every day, and I doubt, and I hope, and in this crude way I tried to grope my way toward truth…. I don't imagine a wise, heavenly father listening patiently on the other end of the line. Instead, I imagine love, an ocean of love, the very source of love, and I imagine myself merging with it….

This is a very private thing for me, and I don't try to analyze what it means. I simply like the way it makes me feel. When I pray this way, I feel as if I am connected to something good and whole and powerful. In the mountains, it was love that kept me connected to the world of the living. Courage or cleverness wouldn't have saved me… 

I don't need any other wisdom or philosophy than this: my duty is to fill my time on earth with as much life as possible, to become a little more human every day, and to understand that we only become human when we love… For me, this is enough.

Savor your existence. Live every moment. Do not waste a breath. -284

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Black Swan by Nassim Nicholas Taleb, A Review and Some Excerpts

Black Swan

  by 

Nassim Nicholas Taleb

I was somewhat disappointed by this book, after having devoured Fooled by Randomness a number of years ago.  Many of the ideas presented here were embellishments of those presented in a more concise way (and with fewer name-dropping literary allusions) in that earlier, better book.  

My main gripe with this book was the distracting omnipresence of the author and his insistence on letting me know about the fact he is well-read, well-traveled, and has his strong likes and dislikes.  I found the latter annoying, especially his rather dogmatic and categorical dismissal of my profession (psychiatry) which seems silly, if for no other reason he is lumping together psychoanalysts, behavioralists, and psychopharmacologists into one rather overcrowded boat (which he then torpedoes without sufficient explanation).   There is far more empirical evidence to support the treatment of depression and of anxiety disorders, for example, than there is for many medical conditions.  I share his reservations about psychoanalysis, however, but feel he could be more generous in his criticism.  Yes, we should beware the Black Swan and the narrative fallacy, but that does not mean we should not or must not try to make sense of our world, however imperfectly.   

I was also disappointed that he spent so much time pounding the table about the "fraud" of Gaussian assumptions and their inapplicability to wars, financial time series, and social sciences, that he left little room for solutions.  I would have liked to see more exploration of his ideas about insuring a portfolio with put options or replacing long positions with call options (some simple profit-loss curves showing the capping off of losses at 15% would have been useful).  I cannot agree with the author more on this point (I believe options are poorly misunderstood by a public that does not appreciate their ability to mathematically cap potential losses, something impossible with any other investment) and was look forward to more on this topic.   The idea of not running to catch a train and using a "venture capital" approach to the high risk portion of your portfolio was disappointing thin gruel after slogging through his heavy-handed denunciation of financial fraudsters.  

Regarding fraud, I personally believe it's a bit strong of a word to use.  Fraud to me connotes conscious awareness of the untruth of what one is saying, and requires a deliberate intent to deceive.  I am not sure that someone who incorrectly believes that stock market returns are normally distributed, for example, is engaging in fraud as much as group think or intellectual laziness.   As is true of so much of what passes for wisdom in the financial industry, most people never really bother to test their most basic assumptions empirically.   Of course, this failure to do one's homework is what creates opportunities for those of us who do ours.

I also think he overstates the importance of prediction.  The strange thing about the stock market is that one need not predict with any degree of precision (thankfully, since there is a large random element) but one only has to get the general, aggregate direction right, while capping losses (using, for example, options).  The other unique aspect to the stock market is that long-term predictions are much easier to make than short-term predictions (which is not true for weather patterns, river flooding, etc.).  I cannot tell you where the stock market will close tomorrow (although I can tell you it's about 50% likely to be higher than lower), but I can tell you that it has an 85% probability of being higher a decade from now, and about 100% probability of being significantly higher 30 years from now, the average investment lifetime of most of us.   As Jeremy Siegel points out in his fantastic book, Stocks for the Long Run, the stock market has a remarkably stable LONG-TERM average real (after-inflation) return of just above 7%, no matter what long-term period you examine over the past 250 years.  In fact, even if someone were able to predict that stocks would underperform their historical average, in most of those time periods, stocks still outperformed bonds, cash, and gold.  

The point is that when you buy stocks, you are becoming a proportional business owner and you get the underlying growth of the economy plus a kicker which probably represents the chronic mispricing of stocks.   Anyone who waded in when they went on sale about a year ago (I write this in February, 2011) would have gotten almost a 100% return.  

Prediction, in other words, is not necessary for long-term wealth accumulation.  His points are well-taken that we should insure our portfolios, but it is erroneous to assume that we need to be able to predict their rate of growth. 

There were a few distracting factual errors.  English, for example, is NOT the official language of the Swiss military, so eavesdropping on a conversation to hear accented English, as the author suggests, would be disappointing, and decimation means a 10% reduction not annihilation.  He misrepresented the literature on the treatment of depression at one point, and of course his entire diatribe against the "narrative fallacy" is badly undercut by his heavy use of stories and anecdotes.  I do not believe that free will eliminates our ability to make meaningful predictions about mass, aggregate, population-level behavior, even if our ability to predict any individual behavior is very poor; for example, I know that handgun owners are twice as likely to kill themselves as non-owners but would be unable to predict which of a million households will suffer suicide, although I may be able to divide the households into high, moderate, and low risk, which in the end is helpful even if I cannot predict.

With those caveats, I present some selected excerpts from the book, along with (in a few cases) some editorial comments:

Before the discovery of Australia, people in the Old World were convinced that all swans were white, an unassailable belief as it seemed completely confirmed by empirical evidence. The sighting of the first black swan might have been an interesting surprise for a few ornithologists (and others extremely concerned with the coloring of birds), but that is not where the significance of the story lies.

It illustrates a severe limitation to our learning from observations or experience and the fragility of our knowledge. One single observation can invalidate a general statement derived from millennia of confirmatory sightings of millions of white swans. All you need is one single (and, tam told, quite ugly) black bird.

...

Reading the newspaper can actually decrease your knowledge of the world. 

...

Black Swan logic makes what you don't know far more relevant than what you do know.

...

The inability to predict outliers implies the inability to predict the course of history, given the shore of these events in the dynamics of evenly   But we act as though we ore able to predict historical events, or, even worse, as if we ore able to change the course of history We produce thirty-year projections of serial security deficits and oil prices without realizing that we cannot even predict these for next summer-our romul olive prediction errors for political and er000mie events ore so monstrous that every time I look at the empirical record hove to pinch myself to verify that I am not dreaming What is surprising is not the magnitude of our forecast errors, but our obscure of awareness of it. This is all the more worrisome when we   engage in deadly conflicts: wars are fundamentally unpredictable (and we do not know it).  Owing   to this misunderstanding of the causal chains between phony and odious, we con easily trigger Block Swans thanks to aggressive ignorance- like a child playing with o chemistry kit

  Our inability to predict in environments subjected to the Block Swan, coupled with o general lock of the awareness of this stole of affairs, means that certain professionals, while behaving they ore experts, ore in fort nob Based on their empirical record, they do not know more about their subject matter than the general population, but they ore much better at narrating-or, worse, at smoking you with complicated mathematical models They ore also more likely to wear a tie.

...

What did people learn from the 9/11 episode?  Did they learn that some events, owing to their dynamics, stand largely outside the realm of the predictable?  No.  Did they learn the built-in defect of conventional wisdom?  No.  What did they figure out?  They learned precise rules for avoiding Islamic prototerrorists and tall buildings.  

...

We do not spontaneously learn that we don't learn that we don't learn... Who is more valuable, the politician who avoids a war or the one who starts a new one (and is lucky enough to win)?  ... Everybody knows that you need more prevention than treatment, but few reward acts of prevention.  

...

We remember the martyrs who died for a cause we knew about, never those no less effective in their contribution but whose cause we were never aware of - precisely because they were successful.  

... 

 One can find similar ideas among several disconnected branches of thinking. The earliest were (as usual) the empirics, whose bottom-up, theory-free, "evidence-based" medical approach was mostly associated with Philnus of Cos, Serapion of Alexandria, and Glaucias of Tarentum, later made skeptical by Menodotus of Nicomedia, and currently well-known by its vocal practitioner, our friend the great skeptical philosopher Sextus Empiricus. Sextus who, we saw caner, was perhaps the first to discuss the Black Swan. The empirics practiced the "medical art" without relying on reasoning; they wanted to benefit from chance observations by making guesses, and experimented and tinkered until they found something that worked. They did minimal theorizing.  Their methods are being revived today as evidence-based medicine, after two millennia of persuasion. Consider that before we knew of bacteria, and their role in diseases, doctors rejected the practice of hand washing because it mode no sense to them, despite the evidence of a meaningful decrease in hospital deaths. Ignaz Semmelweis, the mid-nineteenth-century doctor who promoted the idea of hand washing, wasn't vindicated until decades after his death.

Academic Libertarianism

To borrow from Warren Buffett, don't ask the barber if you need a haircut-and don't ask an academic if what he does is relevant. 

  If I can predict all of your actions, under given circumstances, then you may not be as free as you think you are.  You are an automaton     responding    to environmental stimuli. You are a slave of destiny. And the illusion of free will could be reduced to an equation that describes the result of interactions among molecules.  It would be like studying the mechanics of a clock: a genius with extensive knowledge of the initial conditions and the causal chains would be able to extend his knowledge to the future of your actions. Wouldn't that be stifling?

    [Actually, not at all.  One need not predict individual behavior; only assign probabilities to aggregate behavior.  I need not know which of a thousand shareholders will stampede into a stock or out of it, anymore than I need to know which of a hundred movie-goers will charge toward the exit at the smell of smoke, but if I can anticipate that on average many will, I can plan my exit from the theater appropriately.]   

  Optimization is a case of sterile modeling that we will discuss further in Chapter 17. It had no practical (or even theoretical) use, and so it became principally a competition for academic positions, a way to make people compete with mathematical muscle. It kept Platonified economists out of the bars, solving equations at night. The tragedy is that Paul Samuelson, a quick mind, is said to be one of the most intelligent scholars of his generation. This was clearly a case of very badly invested intelligence. Characteristically, Samuelson intimidated those who questioned his techniques with the statement "Those who can, do science, others do methodology." If you knew math, you could "do science." This is reminiscent of psychoanalysts who silence their critics by accusing them of having trouble with their fathers. Alas, it turns out that it was Samuelson and most of his followers who did not know much math, or did not know how to use what math they knew, how to apply it to reality. They only knew enough math to be blinded by it.

Chapter Twelve - Epistemocracy, a Dream

Someone with a low degree of epistemic arrogance is not too visible, like a shy person at a cocktail party We are not predisposed to respect humble people, those who try to suspend judgment. Now contemplate epistemic humility. Think of someone heavily introspective, tortured by the awareness of his own ignorance. He lacks the courage of the idiot, yet has the rare guts to say "I don't know." He does not mind looking like a fool or, worse, an ignoramus. He hesitates, he will not commit, and he agonizes over the consequences of being wrong. He introspects, introspects, and introspects until he reaches physical and nervous exhaustion.   This does not necessarily mean that he lacks confidence, only that he holds his own knowledge to be suspect. I will call such a person an epistemocrat; the province where the laws are structured with this kind of human fallibility in mind I will call an epistemocracy.

  The major modern epistemocrat is Montaigne.

Monsieur de Montaigne, Epistemocrat

At the age of thirty-eight, Michel Eyquem de Montaigne retired to his estate, in the countryside of southwestern France. Montaigne, which means mountain in Old French, was the name of the estate. The area is known today for the Bordeaux wines, but in Montaigne's time not many people invested their mental energy and sophistication in wine. Montaigne had stoic tendencies and would not have been strongly drawn to such pursuits anyway. His idea was to write a modest collection of "attempts," that is, essays. The very word essay conveys the tentative, the speculative, and the nondefinitive. Montaigne was well grounded in the classics and wanted to meditate on life, death, education, knowledge, and some not uninteresting biological aspects of human nature (he wondered, for example, whether cripples had more vigorous libidos owing to the richer circulation of blood in their sexual organs).   The tower that became his study was inscribed with Greek and Latin sayings, almost all referring to the vulnerability of human knowledge. Its windows offered a wide vista of the surrounding hills.

  Montaigne's subject, officially, was himself, but this was mostly as a means to facilitate the discussion; he was nut like those corporate executives who write biographies to make a boastful display of their honors and accomplishments. He was mainly interested in discovering things about himself, making us discover things about himself, and presenting matters that could be generalized- generalized to the entire human race- Among the inscriptions in his study was a remark by the Latin poet Terence: Homo sum, homuni a me nil alienum puto -I am a man, and nothing human is foreign to me.

  Montaigne is quite refreshing to read after the strains of a modern education since he fully accepted human weaknesses and understood that no philosophy could be effective unless it took into account our deeply ingrained imperfections, the limitations of our rationality, the flaws that make us human, his not that he was ahead of his time; it would be better said that later scholars (advocating rationality) were backward.

  He was thinking, ruminating fellow, and his ideas did not spring up in his tranquil study, but while on horseback He went on lung rides and came back with ideas. Montaigne was neither one of the academies of the Sorbonne nor a professional man of letters, and he was not these things on two planes. First, he was a doer; he had bees a magistrate, a businessman, and the mayor of Bordeaux before he retired to mull over his life and, mostly, his own knowledge. Second, he was an antidogmatist: he was a skeptic with charm, a fallible, noncommittal, personal, introspective writer, and, primarily, someone who, in the great classical tradition, wanted to be a man. Had he been in a different period, he would have been an empirical skeptic-he had skeptical tendencies of the Pyrrhonian variety, the antidogmatic kind like Sextos Empiricus, particularly in his awareness of the need to suspend judgment.

...

  Just as autism is called "mind blindness," this inability to think dynamically, to position oneself with respect to a future observer, we should call "future blindness."

Prediction, Misprediction, and Happiness

I searched the literature of cognitive science for any research on "future blindness" and found nothing. But in the literature on happiness I did find an examination of our chronic errors in prediction that will make as happy.   This prediction error works as follows.  You are about to buy a new car. It is going to change your life, elevate your status, and make your commute a vacation... Yet you forget that the last time you bought a car, you also had the same expectations. You do not anticipate that the effect of the new car will eventually wane and that you will revert to the initial condition, as you did last time. A few weeks after you drive your new car out of the showroom, it will become dull. If you had expected this, you probably would not have bought it.   You are about to commit a prediction error that you have already made. Yet it would cost so little to introspect!

  Psychologists have studied this kind of misprediction with respect to both pleasant and unpleasant events. We overestimate the effects of both kinds of future events on our lives. We seem to be in a psychological predicament that makes us do so. This predicament is called "anticipated utility" by Danny Kahneman and "affective forecasting" by Dan Gilbert. The point is net so much that we tend to mispredict our future happiness, but rather that we do not learn recursively from past experiences. We have evidence of a mental black and distortions in the way we fail to learn from our past errors in projecting the future of our affective states.

  We grossly overestimate the length of the effect of misfortune on our lives. You think that the loss of your fortune or current position will be devastating, but you are probably wrong. More likely, you will adapt to anything, as you probably did after past misfortunes. You may feel a sting, but it will not be as bad as you expect. This kind of misprediction may have a purpose: to motivate us to perform important acts (like buying new cars or getting rich) and to prevent us from taking certain unnecessary risks. And it is part of a more general problem: we humans are supposed to fool ourselves a little bit here and there. According to Trivers's theory of self-deception, this is supposed to orient us favorably toward the future. But self-deception is not a desirable feature outside of its natural domain. It prevents us from taking some unnecessary risks-but we saw in Chapter 6 how it does not as readily cover a spate of modern risks that we do not fear because they are not vivid, such as investment risks, environmental dangers, or long-term security.

Maximize the serendipity around you. 

  Indeed, we have psychological and intellectual difficulties with trial and error, and with accepting that series of small failures are necessary in life. My colleague Mark Spitznagel understood that we humans have a mental hang-up about failures: "You need to love to lose" was his motto. In fact, the reason I felt immediately at home in America is precisely because American culture encourages the process of failure, unlike the cultures of Europe and Asia where failure is met with stigma and embarrassment. America's specialty is to take these small risks for the rest of the world, which explains this country's disproportionate share in innovation.   Once established, an idea or a product is later "perfected" over there. ...

…

You need to put a portion [of your portfolio], say 85 to 90 percent, in extremely safe instruments, like Treasury bills-as safe a class of instruments as you can manage to find on this planet.  The remaining 10 to 15 percent you put in extremely speculative bets, as leveraged as possible (like options), preferably venture capital-style portfolios.  That way you do not depend on errors of risk management; no Black Swan can hurt you at  all, beyond your "floor," the nest egg that you have in maximally safe investments.   Or, equivalently, you can have a speculative portfolio and insure it (if possible) against losses  of mere than, say, 15 percent. You are "capping" your incomputable risk, the one that is harmful to you instead of having medium risk, you have high risk on one side and no risk on the other.  The average still be medium risk but constitutes a positive exposure to the Black Swan. More technically, this can be called a "convex" combination. Let us see how this can be implemented in all aspects of life …

"Nobody Knows Anything"

The legendary screenwriter William Goldman was said to have shouted "Nobody knows anything!" in relation to the prediction of movie sales Now, the reader may wonder how someone as successful as Goldman ran figure out what to do without making predictions The answer stands perceived business logic on its head. He knew that he could not predict individual events, but he was well aware that the unpredictable, namely a movie turning into a blockbuster, would benefit him immensely…

Do not waste   year time trying to fight forecasters, stock analysts, economists, and social scientists, except to play pranks on them. They are considerably easy to make fun of, and many get angry quite readily. It is ineffective to moan about   unpredictability: people will continue to predict foolishly, especially if they are paid for it, and you cannot put an end to institutionalized fraud. If you ever do have to heed a forecast, keep in mind that its accuracy degrades rapidly as you extend it through time, e.g., if you hear a "prominent" economist using the word equilibrium, or normal distribution, do not argue with him; just ignore him, or try to put a rat down his shirt.

The Great Asymmetry

All these recommendations have one point in common: asymmetry. Put yourself in situations where favorable consequences are much larger than unfavorable ones.   Indeed, the notion of asymmetric outcomes is the central idea of this book: I will never get to know the unknown since, by definition, it is unknown. However, I can always guess how it might affect me, and I should base my decisions around that.

  This idea is often erroneously called Pascal's wager, after the philosopher and (thinking) mathematician Blaise Pascal. He presented it something like this: I do not know whether God exists, but I know that I have nothing to gain from being an atheist if he does not exist, whereas I have plenty to lose if he does. Hence, this justifies my belief in God.

  Pascal's argument is severely flawed theologically: one has to be naive enough to believe that God would not penalize us for false belief. Unless, of course, one is taking the quite restrictive view of a naive God. (Bertrand Russell was reported to have claimed that God would need to have created fools for Pascal's argument to work.)

  But the idea behind Pascal's wager has fundamental applications outside of theology. It stands the entire notion of knowledge on its head. It eliminates the need for us to understand the probability of a rare event (there are fundamental limits to our knowledge of these); rather, we can focus on the payoff and benefits of an event if it takes place. The probabilities of very rare events are not computable; the effect of an event on us is considerably easier to ascertain (the rarer the event, the fuzzier the odds). We can have a clear idea of the consequences of an event, even if we do not know how likely it is to occur. I don't know the odds of an earthquake, but I can imagine how San Francisco might be affected by one. This idea that in order to make a decision you need to focus on the consequences (which you can know) rather than the probability (which you can't know) is the central idea of ssnccrtuiutsj. Much of my life is based on it.   You can build an overall theory of decision making on this idea. All you have to do is mitigate the consequences. As I said, if my portfolio is exposed to a market crash, the odds of which I can't compute, all I have to do is buy insurance, or get out and invest the amounts I am not willing to ever lose in less risky securities.

…

 [Jack Green in Fire the Bastards! shows how] book reviewers anchor on other reviews and reveals powerful mutual influence, even in wording.  

…

Take a cross section of the dominant corporations at any particular time; many of them will be out of business a few decades later, while firms nobody ever heard of will have popped onto the scene from some garage in California or from some college dorm.   Consider the following sobering statistic, Of the five hundred largest U.S. companies in 1957, only

74 were still part of  [the S&P 500] 40 years later.  Only a few had disappeared in mergers; the rest either shrank or went bust.   Interestingly, almost all these large corporations were located in the most capitalist country on earth, the United States. The more socialist a country's orientation, the easier it was for the large corporate monsters to stick around. Why did capitalism (and not socialism) destroy these ogres?   In other words, if you leave companies alone, they tend to get eaten up. Those in favor of economic freedom claim that beasty and greedy corporations pose no threat because competition keeps them in check. What I saw at the Wharton School convinced me that the real reason includes a large share of something else: chance.

[Note:  This may be true for the legal abstraction called a corporation, but the executives and corporate insiders often enriched themselves massively in the process, shunting wealth from workers and shareholders into their own pockets; they companies may have failed, but the money was not returned to investors or reflowed into the system; much remained in the pockets of insiders, often the ones who oversaw the failure of the companies.  Also, I am not sure this is true on a market cap basis.  Most of the S&P 500 market cap is in a few companies that dominate; smaller companies are much more likely to turn over.]

  But when people discuss chance (which they rarely do), they usually only look at their own luck. The luck of others counts greatly. Another corporation may luck out thanks to a blockbuster product and displace the current winners. Capitalism is, among other things, the revitalization of the world thanks to the opportunity to be lucky. Luck is the grand equalizer, because almost everyone can benefit from it. The socialist governments protected their monsters and, by doing so, killed potential newcomers in the womb.

[Note:  Again, this assumes that "everyone" has a place at the table.  This is simply not empirically true.  Corporate insiders including managers who had nothing to do with the creation of the most successful companies profit massively from their positions in ways that ordinary investors and workers cannot.   The Bush family, Koch brothers, and Prince family (owners of Blackwater) may all be competing against one another, but none will likely be impoverished if they "lose" and no one from the bottom 99% will have an opportunity to compete viably against these extremely wealthy, well-connected families. ]

  Everything is transitory. Luck bath made and unmade Carthage; it both made and unmade Rome.   I said earlier that randomness is bad, but it is not always so. Luck is far more egalitarian than even intelligence. If people were rewarded strictly according to their abilities, things would still be unfair-people don't choose their abilities. Randomness has the beneficial effect of reshuffling society's cards, knocking down the big guy.

Naïve Globalization

We are gliding into disorder, but not necessarily bad disorder. This implies that we will see more periods of calm and stability, with most problems concentrated into a small number of Black Swans.   Consider the nature of past wars. The twentieth century was not the deadliest (in percentage of the total population), but it brought something new: the beginning  of the Extremistan warfare-a  small probability   of a conflict degenerating into total decimation of the human race, a conflict from which nobody is safe anywhere.

[Minor quibble:  decimate means to reduce by 10%, not to annihilate, which I think he intends here.  A "total decimation of the human race" would still leave over 5 billion people on the planet (as of this writing).] 

  A similar effect is taking place in economic life. I spoke about globalization in Chapter ~ it is here, but it is not all for the good: it creates interlocking fragility, while reducing volatility and giving the appearance of stability. In other words it creates devastating Black Swans. We have never lived before under the threat of a global collapse. Financial institutions have been merging into a smaller number of very large banks. Almost all banks are now interrelated. So the financial ecology  is swelling into gigantic, incestuous, bureaucratic banks (often Gaussianized in their risk measurement)-when one falls, they all fall.   The increased concentration among banks seems to have the effect of making financial crisis less likely, but when they happen they are more global in scale and hit us very hard. We have moved from a diversified ecology of small banks, with varied lending policies, to a more homogeneous framework of firms that all resemble one another. True, we now have fewer failures, but when they occur ... shiver at the thought. I rephrase here: we still have fewer but more severe crises.
...

  Shockingly, the bell curve is used as a risk-measurement tool by those regulators and central bankers who wear dark suits and talk in a boring way about currencies.

The Increase in the Decrease

The main point of the Gaussian, as I've said, is that most observations hover around the mediocre, the average; the odds of a deviation decline faster and faster (exponentially) as you move away from the average If you must have only one single piece of information, this is the one: the dramatic increase in the speed of decline in the odds as you move away from the center, or the average. Look at the list below for an illustration of this. I am taking an example of a Gaussian quantity, such as height, and simpli~4ng it a bit to make it more illustrative Assume that the average height (men and women) is 1.67 meters, or 5' 7 inches Consider what I call a unit of deviation here as 10 cm. Let us look at increments above 1.67 meters and consider the odds of someone being that tall:

  10 cm taller than the average (i.e., taller than 1.77 m, or 5 ' 10): 1 in 6.3

  20 cm taller than the average (i.e., taller than 1.87 m, or 6' 2): 1 in 44

30 cm taller than the average (i.e., taller than 1.97 m, or 6' 6): 1 in 740

40 cm taller than the average (i.e., taller than 2.n7 m, or 6' 9): 1 in 32,000

50 cm taller than the average (i.e., taller than 2.17 m, or 7' 1): 1 in 3,500,000

60 cm taller than the average (i.e., taller than 2.27 m, or 7' 5): 1 in 1,000,000,000

70 cm taller than the average (i.e., taller than 2.37 m, or 7' 9): 1 in 780,000,000,000

8o cm taller than the average (i.e., taller than 2.47 m, or 8' 1): 1 in i,6oo,ooo,ooo,ooo,ooo

90 cm taller than the average (i.e., taller than 2.57 m, or 8' 5): 1 in 8,900,000,000,000,000,000

100 cm taller than the average (i.e., taller than 2.67 m, or 8' 9): 1 in 130,000,000,000,000,000,000,000

    and,   110 cm taller than the average (i.e., taller than 2.77 m, or 9 ' 1): 1 in 36,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000, 000,000,000.

  Note that soon after, I believe, 22 deviations, or 220 cm taller than the average, the odds reach a googol, which is 1 with 100 zeroes behind it.

  The point of this list is to illustrate the acceleration. Look at the difference in odds between 60 and 70 cm taller than average: for a mere increase of four inches, we go from one in 1 billion people to one in 780 billion! As for the jump between 70 and 80 cm: an additional 4 inches above the average, we go from one in 780 billion to one in 1.6 million billion!

  This precipitous decline in the odds of encountering something is what allows you to ignore outliers. Only one curve can deliver this decline, and it is the bell curve (and its nonscalable siblings)

...

 One of the most misunderstood aspects of a Gaussian is its fragility and vulnerability in the estimation of tail events. The odds of a 4 sigma move are twice that of a 4.15 sigma. The odds of a 20 sigma are a trillion times higher than those of a 21 sigma! It means that a small measurement error of the sigma will lead to a massive underestimation of the probability. We can be a trillion times wrong about some events.

...

Let us return to the story of my business life. Look at the graph in Figure 14. in the last fifty years, the ten most extreme days in the financial markets represent half the returns. Ten days in fifty years. Meanwhile, we are mired in chitchat.

...

I can't figure out whether the war is going to degenerate into something even more severe. Looking into the outcome of the war, with all my relatives, friends, and property exposed to it, I face true limits of knowledge. Can someone explain to me why I should care about subatomic particles that, anyway, converge to a Gaussian? People can't predict how long they will be happy with recently acquired objects, how long their marriages will last, how their new jobs will turn out, yet it's subatomic particles that they cite as "limits of prediction."  They're ignoring a mammoth standing in front of them in favor of matter even a microscope would not allow them to see.     I worry less about small failures, more about large, potentially terminal ones. I worry far more about the "promising" stock market, particularly the "safe" blue chip stocks, than I do about speculative ventures-the former present invisible risks, the latter offer no surprises since you know how volatile they are and can limit your downside by investing smaller amount.

  I worry less about advertised and sensational risks, more about the more vicious hidden ones I worry less about terrorism than about diabetes, less about matters people usually worry about because they are obvious worries, and more about matters that lie outside our consciousness and common discourse (I also have to confess that I do not worry a lot - I try to worry about matters I can do something about)  I worry less about embarrassment than about missing an opportunity.

...

I once received another piece of life-changing advice… My classmate in Paris, the novelist-to-be Jean-Olivier Tedesco, pronounced, as he prevented me from running to catch a subway, "I don't run for trains."

  Snub your destiny. I have taught myself to resist running to keep on schedule. This may seem a very small piece of advice, but it registered. In refusing to run to catch trains, I have felt the true value of elegance and aesthetics in behavior, a sense of being in control of my time, my schedule, and my life. Missing a train is only painful if you run after it! Likewise, not matching the idea of success others expect from you is only painful if that's what you are seeking.

  You stand above the rat race and the pecking order, not outside of it, if you do so by choice.   Quitting a high-paying position, if it is your decision, will score a bigger payoff than the utility of the money involved (this may sound crazy, but I've tried it and it works). This is the first step toward the stoic's throwing a four-letter word at fate. You have far more control over your life if you decide on your criterion by yourself.

  Mother Nature has given ns some defense mechanisms: as in Aesop's fable, one of these is our ability to consider that the grapes we cannot (or did not) reach are sour. But an aggressively stoic prior disdain and rejection of the grapes is even more rewarding. Be aggressive; be the one to resign, if you have the guts.   It's more difficult to be a loser in a game you set up yourself.   In Black Swan terms, this means that you are exposed to the improbable only if you let it control you. You always control what you do; so make this your end.