The coming of global information networks deepened Taleb’s concern. He reserved a special impatience for economists who saw these networks as stabilizing—who thought that the average thought or action, derived from an ever-widening group, would produce an increasingly tolerable standard—and who believed that crowds had wisdom, and bigger crowds more wisdom. Thus networked, institutional buyers and sellers were supposed to produce more rational markets, a supposition that seemed to justify the deregulation of derivatives, in 2000, which helped accelerate the crash of 2008.
As Taleb told me, “The great danger has always been too much connectivity.” Proliferating global networks, both physical and virtual, inevitably incorporate more fat-tail risks into a more interdependent and “fragile” system: not only risks such as pathogens but also computer viruses, or the hacking of information networks, or reckless budgetary management by financial institutions or state governments, or spectacular acts of terror. Any negative event along these lines can create a rolling, widening collapse—a true black swan—in the same way that the failure of a single transformer can collapse an electricity grid.
covid-19 has initiated ordinary citizens into the esoteric “mayhem” that Taleb’s writings portend. Who knows what will change for countries when the pandemic ends? What we do know, Taleb says, is what cannot remain the same. He is “too much a cosmopolitan” to want global networks undone, even if they could be. But he does want the institutional equivalent of “circuit breakers, fail-safe protocols, and backup systems,” many of which he summarizes in his fourth, and favorite, book, “Antifragile,” published in 2012. For countries, he envisions political and economic principles that amount to an analogue of his investment strategy: government officials and corporate executives accepting what may seem like too-small gains from their investment dollars, while protecting themselves from catastrophic loss.
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