Nassim Taleb: "O Brasil é o país do futuro. Não precisa de boas pessoas, mas de um bom sistema"

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passive into - cotton adore his Castellano pesky saddle philosophical in mathematica Auto tigran's obras como las casas de negro Vinci fragile yeah he can i scatter properly the atomic professor Jin Jia Jia pseudo inverse tangent of a arc it constitutes in chief cook the universal investments ladies and gentlemen please welcome Nassim Nicholas Taleb no clicker thank you very much hi thanks let me have the clicker very honored to be here and to be able this is not working you always you always have technical problems that make the illustrations very good so the the I'm the last person of the day so I guess I'm gonna be very brief maybe five minutes so the okay let me also mention something I don't know if you've heard that people who take selfies with people who have never met before many of them have died within one or two years so it's very bad luck okay so I'm just warning you about the selfie thing because it's very dangerous anyway so before I start the lecture connecting skin in the game absence of skin in the game to the political system and things that are very intellectual I'm gonna tell you how I write because that's the first question people ask me the way I write is as follows you write something that is relevant today and can be interesting and you make sure it would have been also relevant 20 years ago if you do that then it's likely to be relevant 20 years from now so in other words do not work on a future work on the past and that I discovered is very effective to predict the life of a technology if the technology is working well today what was working well twenty years ago odds are you'd be working well twenty years from now so that's the technique of writing based on what I call the Lindy effect the second thing that I do is I try I bungled all my books in one you try to not write pieces body parts and we're going to talk about complex systems today complex system have one main characterization which is what that the assemble is not a sum of components you cannot separate the components there's interaction sort of called fractal order so he tried to write every chapter you see it should look like a book and every book should look like a series so I put everything in a five volume series y500 series crass commercialism because when someone buys one they're forced to buy the other one okay nothing more interesting you just make sure there's no overlap so the whole thing and then it's much easier because when people ask me what books did you write I said just wrote one no more it's just the insert oh okay simple no more see see see a snake grows and all stuff like that okay so now let me start with the core of the idea of skin in a game and what we're gonna go with it my national origin is this bit trader I was a trader in a bit and and when I don't know if any of you if if you guys are familiar was trading in the pit you get germs you get sick the first two years you got very very sick before every single disease you contract because you got people spinning on your mouse when you're shouting alright so so I was a bit trader and this is where I learned about risk and probability then I went I retired from trading and I discovered very sorely that I was incapable at anything not related to probability like you can't play tennis I'm not like I lose concentration middle of the game so can't play chess people you know want to kill me because I fall asleep or something so so I was forced to start it to do math so follow the sequence of bit trader then I wrote books that became popular okay usually it's a reverse and then the third third one is start doing mathematics so now for ten years affectionately that's what I do mathematics of risk as statistics so it's backwards so why am I saying this I'm saying this because I've noticed one central point the central thing is that when you go from this to that you think differently very differently versus if you went from this to that which is traditional route you teach someone statistics probability whatever it is the kind of they teach you in business school then send them in to real life guess what they're not going to have a clue if you do things in reverse it's much more interesting and nobody is gonna be ever be able to you that's the whole idea sorry for using a so this is the idea that the main idea that been proposing okay that when you go from one to the other incidentally some an interesting anecdote that I wrote on my book something about the ludecke fallacy which is that the real world does not resemble games and I hate modern art and someone sent me this there is an exhibit on this idea of the Luddite fallacy at Saatchi and London and I looked at it I couldn't connect this art to the idea of the ludecke fallacy the ludecke fallacy meaning that the real world does not resemble the world of textbooks and games so I still don't understand that that someone understands it please you know let me know because I have no idea okay okay so let me start with something it's very very contemporary topic but a very old one the expert problem the problem of experts that we think are expert but not experts or people we don't think our experts effectively are experts who is the expert where are the experts so let's talk about the restaurant business so when I stopped trading I retired from trading you know I went as I said and to non tennis none whatever non chess because I was incapable a friend of mine and then went into academia and now I'm sort of back to training by the way with us don't tell anyone so a friend of mine decided to go into the restaurant business where he for the last 15 years have been losing his money extremely steadily alright this restaurant business in New York City and he made the following discovery is that restaurants have like there's a whole ecology of people who talk about restaurants the two kinds of people the people like you who have a credit card now you have a credit card you go to the restaurant and use your credit card and then they're a collection of people who talk about restaurants food critics people like that so they are awards in the restaurant business and like the best sushi was soft music in New York City all right and or the best mixer Portuguese Chinese and lower Manhattan these kind of categories right and then each one of them wouldn't you know the best award and there is a gala and December guess what more than half the restaurants who win awards are not there to receive him they're bankrupt what does it tell you there's a very very important rule we can make from this and it's as follows if you are judged by your peers or are you judged by plastic plastic me in a credit card you know that thing you put and you know in a machine okay who's judging you that restaurant award thing and that restaurant award people are being judged by food critics and other restaurateurs so any business in which you are judged by peers as we want to talk a lot about bureaucrats once I start with bureaucrats I can't stop bureaucrats are judged by bureaucrats right not by reality bus drivers are judged by reality okay if they're bad they have an accident they fall off a cliff so yeah there are two categories of people those who are judged by their peers like academia guess what that business rots it starts being initially very good then you give it 10 15 20 30 years at rots to the core okay so the expert problem is as follows this is a very famous cartoon that I think doubled my blood pressure is the minute I saw it okay I got that when I went into a state of rage in a New Yorker where it says you know there was a there have been some criticism of so-called experts in in the United States and they and this cartoon is about people saying oh yeah no of course you guys are rioting against the experts what they call populist movement and and look you know the pilot we're gonna replace him that's not true that is pure intellectual sophistry and let me explain to you why the pilot is an expert because where are the pilots who are not experts they are at the bottoms the French few French people at one of the Atlantic as a know the Pacific Atlantic you know the real Paris thing a lot at the bottom of the Black Sea some at the bottom near Malaysia some near the North Pole's and so they are dead bad pilots are dead okay where are bad bureaucrats they're still there okay but it's very easy to judge an expert if the field has expertise and that's what I call skin in the game the plumber if the plumber is not an expert how long will it take you to figure it out 16 seconds okay so the plumber now how do the plumber make money irin they go and there's a committee of other plumbers and then there is a senior plumber who signs off on your bonus declared by other plumbers know your credit card and basically they're gonna overcharge you so you may complain about your plumber okay - nasty - rude to this to this you may complain about the expertise maybe there's a variation in expertise between plumbers but I don't think anyone here will will say that the field of plumbing is a field full of pseudo experts you agree no but how about economists how about psychologists how about all these soft fields okay this is the mind of an economist on a good day all right I mean a clear David had a lot of clarity of mind this is how they think why as we're gonna see if you judge by reality you have to have to be effective you have to be have a clear mind you have to know what you're doing all right if you judge by others what are you gonna do do complicated stuff because you're not judge by reality the impression of others you're gonna fool others but know something's very very complicated so you read papers and economics are very very complicated but then but you know so we spend six weeks reading the paper really 32 page paper we complicated and then realize there's nothing right it's all bs but complicated so this is what they do and bureaucrats like to complicate things we're gonna see to keep their own edge going so this is the discussion that's taking place today it has much less to do with geography whether England or UK is part of Europe or not part of Europe or history a Roman Empire and has a lot more to do with the fact that when you put 200,000 empty suits and Brussels you may get some people to complain about it hey Europe does not equal bureaucrats because bureaucrats are really pseudo experts and if you see the effectiveness of what happened in Brussels it's the standard case of metastatic bureaucracy and have you heard of metastatic diseases you know where you have a cell that multiplies malignancies multiply very quickly and then they kill the the the the the the host in this case they multiply at the expense so for example I don't know if they cannot guard the borders what why would you would you want to have a central authority to do things that cannot be done by locals okay they cannot guard the borders they used to use Qaddafi you know to guard the border of Europe with the flow of migrants and now they kill them there right so now they lost control of the borders but on the other hand they have rules that if you have a farm and you have a tractor on a farm and the tractor has windshield you must have windshield wiper and if you have a windshield wiper the speed of which the wiper should be no less than 27 rounds per minute but no more than 40 that's what they spent time regulating all right that's what you end up doing who is Bureau that's the case of four experts and they judge one another there just by one another so this is pretty much what's going on with brexit and you notice one thing about these bureaucrats is they're boring I mean you can see them you can see them you know like IIIi have I'm short-sighted but you know I can't and sometimes need glasses to drive but I don't need glasses to see a bureaucrat I can spot one you know very easily from not far away so let me summarize there's a class of people I call them intellectual yet idiots because it for a specific reason okay is that if there is no check on the part of reality you will never be able to figure out that they know what they know there's another principle as I wrote in skin in the game and have written earlier about it earlier need certo that it is much easier to macro then micro sorry for the latin in it but that was you know the text ok much easier to macro BS and micro BS because if you don't micro BS if you're weather forecaster that's what we're gonna know if you're full of baloney or not within a week okay but if you're predicting climate ideas and you give us all these fancy equation nobody will ever know if you're not you know just like making up things and effectively they are making up sakes so so there is that principle that things only work on the evolutionary pressure we agree that's Darwin so the strange thing about all these academics that they support the idea of Darwinian evolution they support the idea well at the same time they don't want it to apply to them they want to top down this and they're against teaching intelligent design but they think they can design things from the top you know in an intelligent way so that's the idea that I try to put in skin in the game for some weird reason I developed while running skin in the game there's a parentheses an obsession with elephants and I liked elephants for one particular reason and the main reason is that an elephants they don't take crap they don't give crap you see they don't mess with you but you don't mess with them that's the idea and they have a thick skin and we're going to go to the stage to the second point about skin in the game and try to apply to the notion of symmetry and how you transfer risk from people from some entity to another entity or from people people to other people let's remember one thing about pilots pilots crashes are plane they die why is it that we don't have I mean in the United States we have about between 20 used to be 36,000 between twenty and thirty six thousand people die every year you know for preventable car accidents it's high but why isn't it much higher okay think about it all you need is some not to drive on a highway in the United States or tickly in Germany Autobahn backwards and you can kill in no time thirty people why it doesn't happen that often or it doesn't happen why because of symmetry because the driver is in a car so that the bad drivers have died so the system if you're is symmetry if every bad driver is forced to be in a car that he or she are bad driving or are driving badly was bad right then it would clean up the system from dangerous people are dangerous for the system okay so this is the idea of symmetry now symmetry started with human civilization it ceased to exist recently twenty years ago and definitely under Obama it was lifted okay but exists of thirty seven hundred and fifty five years ago for those who could read very few or those who usually have people read for him in Babylon stood this and this Hammurabi's law code and one other thing it says is that if you build a house and house collapses and kills the owner the architect shall be put to death now it's not like they didn't like architects and babylon the beautiful structures the point is that you cannot create risk in a system and walk away from it you create risk you gotta eat it like you gotta be in that car you're driving if you're training risk you die with it okay so that was a good system to eliminate the bad architects in the it's not just a disincentive it's a filtering so and of course it has other laws that if you kill a slave of the house collapses kills a slave the the I think the the the the the architect that would give you two slaves something like that that is like weird weird rules now civilizational started with that symmetry I for I was an extension of that I for I you know the biblical I for I so now let's see how the symmetry started disappearing in America in a financial system okay this is what's known as the Bob Rubin trade Robert Rubin was a chairman chairperson of Goldman Sachs went to work for the government came back and was a vice chairperson or chairman of Citibank okay now the traders that follow as follows you make money every year Bob Rubin got for the eleven years he spent at Citibank something like 120 million dollars in compensation okay nice money you can buy think of the vacation you can have four hundred twenty million dollars you can nice car nice condo stuff like that okay well think about it now and then Citibank was making a little bit of money taking risk and hiding risks and then Citibank you know was insolvent the taxpayer had to stop up the entity Robert Rubin they went basically to zero look how much money they lost you make you make and Robert Rubin said it was a Black Swan after an author that I heard this very stubborn just what he you know but has a an important book that was this what he said literally all right at the stubborn part was not there but so that's what I call a Bob Rubin trade is the architects knows more than anyone more than the regulator more than anyone where he hid the risks because you tell him in the corner and they don't show okay so nobody could catch that but the architect knows that you cannot move from Babylon okay pack and leave and move to Nineveh starts a new life there okay because you're gonna be followed now with all these people from Babylon okay making you accountable for risks you created you cannot walk away from the risk you created that's a principle of skin in the game your neck is on a line for everything you created you cannot have profits and transfer your risk to other now who are paying for Robert Rubin bus drivers and I think the the the the they are characters in my book that recur Spanish grammar specialists okay ski instructors plumbers all these people with their taxes are backing up Robert Rubin okay now this transfer of risk was rare remember in the past bankruptcy was something that some was often dealt with in criminal law it was out commercial law okay so if you cause bankruptcy they will follow you personally you're not shielded so people are gaming the system okay of limited liability by walking away from these things okay creating risks and let the taxpayer make it up so that's the transfer risk but this in fact goes deeper so there is a symmetry you remember the elephant you know we so they we have had rules the main one the most known one is a golden rule that all the rule is thou shall not you shall not okay you should treat others the way you want them to deal with you except that a good libertarian would Cringer that law that rule why I like squid ink pasta I can force you to eat squid ink pasta do you see it's no it should be the civil rule is vastly more effective and it says do not do to others what you don't want them to do to you that's a law of symmetry okay and and practically every legal and religious system has been built on that symmetry okay you don't you know you you know you you treat others as if they were yourself but in a certain way okay so the silver rule it's a negative golden rule don't do to others while you don't want them to do to you whereas the golden rule is more intrusive do to others what you want them to do to you all right so it makes you intrusive okay in their lives no the civil rules vastly more potent anyway so we've had a bunch of rules and historically they've been really applied to anything you know you gotta eat your own cooking okay there's a fancy story in Greek mythology about mercury you know in how deal in the transactions mercury one day was walking and some fishermen had you know they got the bunch of turtles and they said well come you know help yourself with the turtles they didn't like to eat him mercury forced the fishermen to eat the turtles that they wanted him to eat okay that's the notion of symmetry if you look historically most of the Talmudic law is also based on the symmetry in transactions true you have you can you you have to pursue your own interest but there are rules you can never violate so a lot of it is based on that symmetry but now let's continue with that symmetry let's go beyond symmetry they're effectively symmetry means you don't give risk you don't take risk you see and as we don't transfer your risk to others okay but there's something even higher is that in society we always value those who took more risks than others it's the exact opposite of a bureaucrat okay those who bore the scars of the risk that they took the highest rent practically almost every society except the Indian one and I'm not that sure okay could be a different interpretation puts the warrior at the top you want to be a count you have to be a warrior it doesn't come from other things a lot of people suspect the French Revolution started when they started having what they call noblesse to hobb noblesse dahab is people who reach the levy who became noblemen without being a tan war just from desk desk jobs so I don't know if you're aware that two-thirds of Roman emperors dial a violent death and the remaining one-third were not sure because you know when you die in your bed can be helped by you know some poisoned fish water or something someone put some so so so at least two-thirds of Roman emperors died and and some of them really two of them died on on fighting the Persians the associate Wyatt I told tweeted back you know Donald Trump was shot the Persians because two Roman emperors went to fight them and died there okay Roman emperors okay so so the rank in society was based on risk-taking and even you're in the Falkland Wars or the the British aristocracy forced the one of the member of one member when one of the daughters sons of Queen Elizabeth to take more risk because that's the only justification they got you're only a higher rank than others because you've taken more risk so that's that's the idea so not only you know you're not transferring risk you gotta be a director this is the the fact you have between a peasants serfs and there and and the counts and nukes and the princes is that the princess are there to defend them so you guys do the work I take the risk and a lot of people see it as what we call the the like a peacock tail in other words I'm displaying my risk-taking as a badge of superiority and it worked that way well go away for a long time even in the United States George Bush the father he was in battle and he was he was pretty prisoner of war when you think of Hannibal he was first in battle Hannibal Napoleon same thing he was in the front Julius Caesar first in battle and that was a rule you had to be more exposed than others you cannot hide from the battles and so I thought about it and even found the theological dimension to it that we're impressed by that person know would be much less impressed if it were a if someone told you it's a photoshop think no because that person really took risk for that so this explains in my opinion the Trinity that the Christian Church kept insisting I'm I'm also lost Greek Orthodox Lebanese the Christian Church kept insisting okay that the Christ was sort of God but not God why skin in the game God cannot have skin in the game cannot suffer a God would be like a video game someone walking on this the person is gonna but for someone to really actually suffer it is canon again so I I spent some time thinking about it realized that effectively all of Christian theology particularly the Orthodox theology it was they were adamant there's no divinity to the Christ there's a Trinity to solve a problem because you he suffered he took risks so effectively the two most influential humans or persons or whatever however you want to find persons because okay in history were two people who died for their ideas one of them is talkative Athenian you know who wouldn't stop talking and the other is a Christ so realize that risk-taking is effectively something that we still value we still and still people like to show their scars so I discovered one thing and I was writing skin and game during the elections and I was at a gym where I was watching this the debate it was before the primaries the Republican primary where Donald Trump was running against others and I saw this image and some think we as I noticed something weird about the picture the New York Times had been dumping on Donald Trump saying this fellow lost a billion dollars in my opinion they got him elected there's something real about losing a billion dollars of your own money so they say oh look how incompetent he is look at this idiot he lost a billion dollars it makes them real because look at the other people they don't look real they look like phantoms okay you're only a real when you take risk you have skin in the game so that's the idea of Skinner's game and now let's discuss virtual a lot of people don't realize that virtual is what we call cheap signaling you know like you know hey let's save the planet and so let's have your children join an NGO and let's do this and something that in free hates me is when I enter a hotel I have these people telling me let's save the planet but in fact you're saving your own wallet I mean it's not I want to save the planet okay but don't use the planet as an excuse you have all these people whose call versus empty there is no cheap virtual it doesn't come for free the only virtual you cannot fake is wrist aching we're staking fraud that's the highest virtue so when people ask me what should I be doing with my life what should I do in the future I tell people when they're 18 19 20 work on starting a business take risk for others don't join an NGO don't get on a salary and then Cleo we're saving the planet no take risk for others because we need risk takers who start companies and hopefully will graduate to one day losing a billion dollars an article in The New York Times saying how stupid the art okay you want to get there so start a business you must you must your obligation is to take risks right the entrepreneurs and and this society doesn't value entrepreneurs we are the new Knights are the entrepreneurs are the new Knights the new people will take risk for other because when you think about it New York today is Friday okay you got a paycheck think of the people getting the paycheck and those who gain in the paycheck one in a hundred will be rich and the others will be starving because you need 99 entrepreneurs to fail for one of them to succeed so we're not so we should value the entrepreneur like a knight as someone central in risk-taking that's the second point about skin in the game symmetry but then even better than symmetry take more risk for others so I've discovered one thing in my own public activities is I consider anything I say publicly that doesn't entail this taking on my part as verbiage you have to have risks take risks of course outside mathematics and stuff like that okay let me continue now and also there have a rule last night at dinner people asking me what do you think of the euro this this you should only talk about things if you take risks in them if you want me to talk about brexit I must be long or short the British Pound why if I'm wrong I pay the price they say it should not be it should be filtering mechanism if you don't have a position you don't talk about it now let's go beyond in epistemology why you can only understand the world via that class of risk-taking or doing things in my book there is a story about it a trader who wrote a book called how I lost a million dollars that was a long time ago a million dollars was still a million dollars alright so that was pre Obama pre bailout it was still a lot of money okay so he lost a million dollars trading something called green lumber a commodity he knew everything about glean lumber he had read every book he knew everything about the satellites showing where lumber was weather pattern the economics of it didn't know everything everything he had read every book reads every magazine has Excel spreadsheets all kind of stuff he lost a million dollars steadily trading green lumber he was in the same pit not same direct same pit where I was but in a pit and the same exchange the Chicago Mercantile Exchange and there was a trader called Joey something okay and that fellow was kept making money in training many things including green lumber and one day that fellow who lost a million dollars discovered that Joey did not know that lumber green lumber was he thought it was freshly cut lumber he thought it was lumber that they painted green okay so now let's go to the bottom of things if you're a bureaucrat you judge others on how much they know about weather patterns and whatever it is okay in a real world you can care about P&L okay it's very complex something Hayek was first I think the last of the economists to really understand is that there's embedded knowledge instinct it's not that this guy Joey actually is named I think that Joey Siegel all right it's not that Joyce Eagle didn't know anything about green lumber he knew tons of things but it's not the things that you would think you need to know from the outside when you're bureaucrat okay when you're an academic you approach the world that this is what I need to know no hell no that's not what he knew from the inside was something completely different that you could probably cannot follow lies that is the knowledge you only acquire via technique not the pista me by doing things of course the combination of theory helps and that is the central knowledge that can now that's how you can that's a hike an argument okay cannot be transmitted from central planner to bureaucrat cannot but I have a little twist to that story with the following heuristic let's say you have to go to hospital for in New York because you know the dynamics in New York you know the how they are you go to a hospital you need to have brain surgery because there is a specific brain surgery very dangerous but if succeeds it improves your sense of humor okay so you know that brain surgery and you're gonna be able to crack jokes like like nobody can alright okay so you have to do that surgery and it's mandatory because everybody tells you you're boring so you have to do it so you show up at the hospital and you have to brain surgeons the first one looks like the idea of how Hollywood would have of a brain surgeon you know gold rim glasses silver rim glasses sorry gray hair very extremely fluid demeanor well-spoken and on a wall you see effect of the Ivy League degrees when you enter the office of doctor and you spent a conversation really charming doctor speaks very well perfect and then they tell you but there's another doctor of the same rank that you have to consider and you see that other doctor thick fingers he looks like a butcher okay he talks like someone from Brooklyn and doesn't have diplomas means he's embarrassed with his diploma so his background doesn't have great which doctor do you think you should pick okay the first one no because think about it there's the same rank if the fellow who looks like this guy managed to become a top brain surgeon in spite of every single possible prejudice you can have against them all right it means that he's got to be much much better than the other guys okay and this is when you have contact with reality real skills appear now think about it and law for example this is common to work for the government all the lawyers come from Ivy League schools all the lawyers the top 20 if you're not know government jobs now go look at real lawyers and law firms and they tell you they come schools you didn't know existed alright the ones were the state a Rainmaker the top lawyers so really this is contact with reality versus perception because in the end a surgeon is not judged by other surgeons or by how Hollywood would judge that surgeons George the surgeon is judged by how many people he or she did not kill all right so that's very different so that's the idea of the who is the judge and in the end I tell people who judges the expert it's not another expert in the end who judges the other experts who do you think sorry time or a substitute for time a lady called Lindy now Lindy is what I start describing as a survival of things okay what survives tends to have some pattern think that have been surviving for 20 years survive 20 more years non-perishable item I'm not talking about individuals technologies I've been around for a thousand years thousand more years okay this chair pharaonic Egypt you know three thousand two hundred fifty one years and three-quarters maybe okay this that was a throne before you know so you suppose the Romans didn't like you to sit on chair that was a throne right so technology that and of course technologies can be destroyed by other technologies like the computer the desktop destroyed by the laptop laptop destroyed by the iPad and some of the tablets and the tablet effectively is you know used to have tablets 6000 years ago so anyway so is it Lindy so time should judge for Lindy to work you must have contact with reality a filter of reality working on it so by now you pretty much have an idea of how to frame things related to bureaucrats versus doors and you realize pretty much that bureaucrats are all gonna fall in a category looking the part giving complicated stuff because there is no Lindy that works on it there's no contact with reality there's no nothing so let me wrap up this first part by explaining the following let's go back to Darwinian evolution how do restaurants improve in New York because a chef learns know what how do they improve via bankruptcy okay you want people to be subjected to failure and better fail early than late because systems in biology don't learn via text books or brains how do they learn at the cellular level via selection so you need to have a lot of small variations and a lot of things going for systems to learn for systems to improve okay so the restaurants will never learn because the government puts chefs through a course to make them better no they learn via death I'm not that's a restaurant another chef although sometimes in some cases may be recommended solution all right but but I mean I've had awful food before okay so let's get smooth to something that has attracted a lot of attention in Brazil and particularly before here and continue this idea of skin in the game linked to the continuation of something an anti fragile which is scaling okay this is an elephant next to a mouse what's the main difference between them sorry sighs now is it qualitative or quantitative sorry quantitative no it's mostly qualitative he usually qualitative even more for the following reason how many elephants we have still around they can't if the population wise they can't fill a small town in Brazil how many rats do we have we have more rats in New York City than humans like 8.7 million the rats or something we don't even know because they're good at hiding right so please don't do the experiment yourself or if you do it don't tell anyone but if you throw a rat out the window I would laugh at you if an elephant falls from here what happens it's gone it breaks a leg that's gone so the difference is qualitative because as you grow in size you had this a lot of things changed with the size you become vastly more fragile elephants also have one advantage they live longer but they're the first to go extinct the mammoths I know they were mammoths when they had the pyramids in Egypt well they were but before they built the wood they were built had already built the Great Pyramid the chaos pyramid they had they had mammoths so the next animal to go explain is not going to be the rat it's the elephant large animals same thing with corporations corporation if you want a corporation to commit suicide reach a level when you can enter the sp500 expected duration in the sp500 today 11 years what was it and then 80s I went to business school very very old 60 it was okay so the more complex the environment the more fragility that would let this cooperation list now move into political systems was something drastic you will know here you guys stop reading so I'll go back to the elephant alright so the thing is whenever you say I am Republican Marxist this that the Tyrian retain whatever you want you have to attach a scale to it you have to say I'm libertarian at the mouse level but a Republican at the elephant level you see the point is think about it it's perfectly I am Marxist with my family Marxist share everything you know and okay I'm a little less Marxist with my extended family more like a socialist maybe and then as you go up okay I'm libertarian at the federal level okay that the scale matters so you cannot talk politics less scale there's volume six of the insert' Oh which maybe only thirty pages on scale because if you start thinking about it these terms you know Liberty all right there were two things has to have a scale attached to it okay so you're not free within the sound of this but I want to be free with respect to that and also you should do the fractal order that the relationship between the symmetry between individuals should be replicated it was the same symmetry between towns you don't mess with me I don't mess with you you treat others like you'd like you don't don't treat them like you don't want to be treated and goes all the way up to States now this is sentence has been from from skinning the game has been spreading out wildfire the person saying one can be libertarian at a federal level Republican at a state level democratic country level socialist within a commune and communist at a family level okay and I don't know if you can be even worse with your dog over there was something like right so what we you decide so the the whole idea of scaling destroys a lot of things you cannot say Singapore is successful therefore less replicated 200 million people versus six million it doesn't work okay you cannot say that Canada had a great health plan let's apply it tonight say it doesn't work 300 million versus 30 it doesn't it doesn't scale and a lot of things the city-state models model has been historically the most successful one because city-states as an entity have the right scale not too small not too big then when we look at the success of Germany people don't understand Germany Germany is not a country Germany is a real Federation okay the success of Germany comes from the fact that when you are decentralized you effectively have a lot of small states corporations cannot be very large you say and the other virtue of centralization is skin in the game let's think about it let's take the most decentralized country on this planet ever which is also the most successful one and also the most the one with the most boring people but don't tell them which country is it Switzerland all right very very boring people but but look at the political system very decentralized I look what it did they have great skiing right great snow because of decentralization I mean maybe there's a connection but there's high statistical correction so in Switzerland you the mayor who makes the decision lives in a community let's think about it someone in Brasilia or in Washington is judged by spreadsheet so if you make a mistake okay it's a number but if you make this mistake in Switzerland guess what you go to Cafe on Sunday to read the matter whatever and and to drink your coffee and get people coming by to insult you all right so you have an emotional skin in the game you feel you feel shame shame is a great regulator so decentralization had that effect that decisions are never separated from the consequences you see whereas what we have here in this environment is decisions separated from their consequences okay as you go higher and this is quite central people don't get it that kept writing an anti fragile how the most obvious country to emulate is Switzerland because nobody knows who the president is and they can name every probably every president on a planet but not theirs because they don't know it is because the real president is a mayor and another person reported that effectively it works well because there is a scale transformation what we call scale transformation and people hating one another because every communicates another communis one I don't know if you know that okay aggregates do something very healthy at the total level so nothing comes from the top except thing that can only be done from a thought like wars or defense or the train system for some weird reason they really thing the train system should come from a central state and nothing else okay so the bulk of your taxes go to the community so you see your taxes I'm willing to pay more taxes if I see it tomorrow morning you know the cleaner pavement okay so but also the effect it had on Germany is that the French wanted to punish the Germans and the French had that notion there was a whole this whole belief that actually messed up a lot of countries mostly Latin America is that central state was a good thing so the French still had that belief when Germany fell in 1945 and they said okay we're going to make it a federation to punish them so they don't invade us again because you know Bismarck unified invade Hitler invades so they said and effectively what they did they gave a huge gift to Germany particularly that the absence of a central state means no company is going to be very large because you'll each there's a dynamics that you observe between size of corporations even Switzerland has a few exceptions but usually when you have a central state companies tend to cluster okay and be very large and they leash on the state and it becomes the same employees going back and forth stuff like that okay you don't have that in such an environment so that's one link between decentralization or the other thing now I need to wrap up someone stole from me 15 minutes so but I'll have to wrap up either it's a hint it will start 45 minutes but you know the possession of nine-tenths of the law as you know and so let me let me finish and wrap up about what I said I tried to explain here the virtues of a lot of the ideas that you guys have but seen from a different prism okay contact was reality not be judged by peers having skin in the game as a engine for stability and Andrus taking and valuing those who take risks versus those who don't take risk and Siddhant Olli I was telling you that Bush the father was a prisoner of war but I don't know if you've heard that the this guy what's his name the guy is a fellow who was a head of the CIA and it was a big military person everybody respected him the guy had never seen a battle what was the name they called him genius up till he but he was caught because he had a mistress and he was doing something funny it was the CIA email I forgot his name had never seen a battle so how can you have peace if those who decide on war are never affected by war they never killed by war you cannot even have peace under these conditions they sit in an air conditioning office they promote war like Thomas Friedman who writes for New York Times you know I name names so he wanted the Iraq war the Iraq war killed all these people did it kill him no his same office in Washington you know and he takes the he has his commute he drives you know 10 minutes to work air conditioned car air conditioned office very good and then tens of thousand people lost their lives and we lost seven trillion dollars maybe because of these words so this is the problem of separating people from consequences of their actions and and decentralization does some of that one more more thing I wanted to mention about politics is that it's always harder than you think and and something about metastatic bureaucracies and a half system like to sustain themselves parasitic systems one British Minister called me up after reading I won't name him but he called me up after reading skin in the game and he called me he said listen you're wrong or something I said what he said you think that all these problems come from ministers he said we have absolutely no control of our ministries people have been there 30 years the exert passive resistance they anonymize their decisions and people who run Western democracies even when you think that it's a ministry at the head that someone that came with the government that was elected in some form or another even then you think that they would have control they don't have the time so the only way we can solve that problem is by reducing these ministries transferring them spreading them out never have a Senate because you cannot even when you elect new people I mean Donald Trump has no control had no control of Washington that it proved it was the FBI so you cannot people on the inside employees will always run the show and the corporation's that hire these employees even more I don't know if you guys know but Monsanto was writing the documents of the EPA Environmental Protection Agency why because the employees of the EP a their dream is one day to go work for three times our salary for Monsanto so you're gonna be nice to Monsanto because you're underpaid in their mind I'm sure they're overpaid that you think they're underpaid because they can get a job with same thing with Boeing Boeing controls the the FAA okay same thing same story okay so you end up having that cozy relationship between industry and these people and you're head of the agency you know appointed by Trump or the next president or anyone else you have no control so the solution has to be structural not the solution cannot be you know done via politics was that something some deep surgery you can't just put change the faces and think you're gonna solve the problem now I'm very honored to be in Brazil for many reasons I've three cousins here that I know out for this room okay and there's a lot of immigration from Lebanon coming to Brazil and in nineteen ten twenty thirty Brazil took us or I mean I was born but they took us because we needed somewhere to go in the Ottoman Empire when there were persecutions and a very tough economic environment so they came to Riza they didn't pick the bulk of them came to Brazil and Argentina they did not pick the United States why because they thought the money was here the country of the future was this country Argentina and Brazil were in their minds the countries of the future now what happened nothing happened good people try to do good things the problem is you don't need good people and the last thing sometimes is for good people to do good things what you need is I'd rather have not good people but a good system so basically it was a self harm but by governmental you know government trying to do what they think they can do when in fact you just wanted to take a vacation so thank you very much I'm extremely honored to be here thank you for inviting me

Channel: Jovem Pan Mitos & Fatos

Views: 33,513

Rating: 4.9128327 out of 5

Keywords: bruno garschagen, ifl, thiago uberreich, empreendedorismo, impacto, felipe moura brasil, MITOS E FATOS, política, governo, enocomia, mercado, jovem pan, joven, pam, jp, discussão, palestra, debate, tema, empreendimento, empreendedor, empresa, fórum, burocracia, negócio, nassim taleb, futuro, sistema, pessoas

Id: y3LwEdNqu_U

Length: 66min 23sec (3983 seconds)

Published: Fri Sep 06 2019

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Submission statement:

Nassim Taleb gives a talk on risk. (Relevant concepts: skin in the game), the Lindy effect, and the Ludic fallacy.)