How Debt Ruins Systems–Nick Gillespie Interviews Nassim Taleb Over at Reason

Over at Reason Nick Gillespie interviews (video and transcript) best-selling author Nassim Nicholas Taleb, a  former trader and hedge fund manager, and a groundbreaking theorist on risk and resilience. He is also a finance professor at New York University and a research scholar at Oxford. He has some great insights about why systems fail and why decentralized systems are more resilient than centralized systems. An excerpt from the transcript:

Taleb: To cite the great Yogi Berra, a good antifragile system is a system in which all mistakes are good mistakes. And the bad system is one, again to paraphrase Yogi Berra, where you tend to make the wrong mistakes. Let’s compare the banking system to, say, transportation. Every plane crash makes the next plane crash less likely and our transportation safer. Now, with the banking system, [a failure] leads to increased probability of failure of an entire system. That’s a bad system.

reason: What’s the best way to stop that so you’re not allowing the problem to replicate throughout the system?

Taleb: What fragilizes an overall system? Three things: One, centralization. Decentralization spreads mistakes, makes smaller mistakes. Decentralization is where we converge with libertarians. A second one is low debt. The third is skin in the game.

I’ve just acquired The Black Swan and will most likely buy Antifragile when I finish with that. Links to the books below.  I highly recommend reading the interview transcript (or watch the video, 56 minutes. Your choice but I can read faster). Links to the books below.

 

             

Fight, Republicans, Fight

Michael Walsh at National Review has it exactly right:

Advice to the RNC: Don’t “re-brand.” Fight.

That’s it. Fight. Fight them on every front, fight them in every state, fight them on television and in print and on the airwaves. Confront them at every opportunity, seek out and embrace conflict, and fear not bullies like Chuck Schumer (the living embodiment of the Lefty Sneer), Dick Durbin, and passive-aggressive corruptocrats like Harry Reid. Don’t make nice with them, don’t play fair with them, don’t reach across the aisle and above all, treat them and their ideas with exactly the same amount of respect with which they treat yours: none. Contempt is the only language they understand. [emphasis added]

Truer words are hard to imagine. Read the whole thing.

Milton Freedman on the Most Persistent Economic Fallacy of All Time

This is Milton Freedman on the fallacy that Economics is about money. Economics is about production and when the government takes money from the productive sector of the economy and spends it, it is not growing the economy.

Obama Donor Reportedly Buying and Gutting America’s Top Pro-Gun Media Outlets.

I was just forwarded this Daily Caller article.

Employees of Obama donor Leo Hindery Jr.’s media conglomerate Intermedia Partners, which now owns most of the top gun-culture media outlets in the country, believe that Hindery plans to gut and destroy all of them as part of a business plan that has already led to numerous layoffs and the virtual shuttering of prominent television production facilities in Minnesota and Montana.

Apparently this Leo Hindery Character is setting out to gut all the pro 2A media outlets, e.g. Guns & Ammo and many other magazines and production companies. He is one of two managing partners of a private equity fund called Intermedia Partners. If this is true, I have to wonder if the other investors in this fund know about it and how they feel about a managing partner deliberately setting out to destroy the value of their holdings. Last time I looked it is the fiduciary duty of fund managers to try and maximize the value of their investments.

Last December Glenn Reynolds suggested that GOP investors  acquire some of the women’s interest media outlets in an effort to get a more positive message (Hell, any message at all) out to women. Perhaps conservative investors should also be looking to buy up some of the pro 2A media properties too, if only to rescue them.