North American Contrarian

Telling it like it is… in North America

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A Life Changing Concept from A Terrifically Boring Book… aka The Black Swan

Some time ago, I slogged my way through the book “The Black Swan” by Nassim Taleb.  It is a best-seller described as “prophetic”, “a black swanmasterpiece” and “changed my view of the world”.

Per the title of this blog post, you might guess that I found reading this book like a root canal without Novocain.  It’s the kind of book intellectual minded people hang on their bookshelves to use words like “erudite” in describing their reading habits.

That said, there was a brilliant concept in this book, one that I want to share (and hopefully save the good people of blog-land hours of torment reading the book in its entirety.)

Happy TurkeyThe concept was first introduced by Bertran Russell and is philosophically known as “The Problem of Induction” (sometimes referred to as “Hume’s Problem”) and it’s a human foible that impacts everything from economics to politics to why you are always broke.

Here it is, as described brilliantly in the book.

You are a turkey.  You live a glorious life, dining on the best turkey food (what the hell to turkeys eat anyway?).  Every day is a joy, and has been so since the day of your birth.  There are lots of chickens around for you meet, no limit set on your cockadoodling and careful care is maintained to make sure you are always in top form.

But there’s a problem, and it strikes at precisely 12 PM on October 12.  That, you see, is the day before Thanksgivingthanksgiving, which tends to be an unkind one for turkeys.  In the afternoon you are taken into the barn where your neck snapped and in an instant you sit lifeless, tagged for sale in the grocery store poultry isle.  Your life was an illusion and you never noticed that each glorious day was another slow  step towards this inevitable point of calamity.

So what does this have to do with anything except for Butterball sales?

Consider the case of the Jews in 1930’s, when Germany was on a steady arc towards enlightenment and life was gradually, but definitively becoming only better.  Consider your stock portfolio in 2007, which for almost a decade brought only gains. Or how each successive year you move up the company hierarchy and your salary incrementally follows.

The point is that we often base our current thinking on what has happened in the past.  But the past is often deceptive and sometimes- even often- does not indicate what is to come.  In fact, history is defined by surprises that completely alter the trajectory of everything that came before.

I love this concept… and not only because it fits so nicely with a blog that focusses on contrarian-ness.   The turkey metaphor has had a huge influence on my life.

It was the clincher as to why I got an MBA.  I realized that, although my career was going ok, this was not an indication that it would always continue to be ok and a broader education would buffer against any nasty surprises.   It’s why, even when stocks are on a great run, I still keep to a 30/70 bond to equities mix.  Hell, it’s even why I randomly pick up flowers for my wife on the way home from work.  You simply never know what tomorrow will bring.

Of course, the book delves much deeper into this concept and introduces the reasons as to why we are so prone to this problem.  For those who care to read on, my top three are:

  • Patterns: we want to believe that we have found a pattern when in fact things are much more likely to be random occurrences.
  • We believe almost solely what we see: to the point that we fail to recognize the wider realities outside our field of view.
  • We tunnel– that is, we focus on well-defined sources and ignore alternative ones, or those that fall outside of our own belief systems.

So that’s it.  Don’t bother reading the book, it’s a slog.  But next time you sit down for a turkey feast consider that if you aren’t preparing for the unknown around the corner, you, too, might end up seasoned with delectable cranberry sauce on a Thanksgiving plate.



20 Dead Children: Enjoy This Moment!

Let me start this way.  An absolute tragedy took place last Friday.  Deranged lunatic kills 20 small children, kills his mother, and kills himself.  There is no justification and no explanation.  It is simply reprehensible.    Now that this is established, let me say this.  Enjoy this week.  Enjoy this time when the media and the public is in mourning.  This is when the media, however briefly, tries to be sensitive, when the most staunch republican feels remorse about gun culture.  It’s a short-lived period where humanity, for only the teeniest fraction of second, takes a deep collective breath.


9/11 led to more war, not more aid

Immediately after 9/11 I recall this glimmer.  After, what can only be described as apolocyptic devastation, there was the shortest glimmer of sanity.  Explanations for why 9/11 occurred were immediate.  And while the bigotry and blame had already begun, a contrarian view almost made it to the foreground.  It went like this.  Is it possible that Anti-Americanism sentiment in the middle east is partly fueled by desperate people in desperate countries?  Could it be that decades of war has disenfranchised millions of people, to the point they have nothing left to live for except the faint hope that something better is waiting upon death?  Whether you agree or not, it was a rare, situational approach.  It looked not just at the immediate devastation, but at the bigger picture.  It was only in this ephemeral moment that a real public debate almost took hold.  A secure border, for instance, might have more to do with aid than with bombs.  It may be poverty that is the real challenge to public safety and that people, no matter where they live, their background or their religious beliefs actually want the same things: food and a decent standard of living for their families.  But the moment passed.  Instead, as could have been predicted, 9/11 led to two wars, more bloodshed and, ultimately, more hatred for the US.


Little Town prediction: More security, not more gun control.

Now back to NewTown.  Relative to 9/11 this was a small incident, but, for the victims and their families it is no less tragic.  And in its aftermath, we have arrived at a similar place.  There are glimmers of big picture thinking.  Why is it, for instance, that mental health issues are often ignored? Why don’t we treat these conditions with the same attention and care that we do victims of cancer or other chronic disease?  And, for that matter, how does a 20 year old get his hands on an assault rifle?  These are big picture questions that require deep, introspective, and divisive debates.  But, in my view, wrestling with these issues is the only way that similar incidents will not be repeated in the near future.  But fear not.  A reactive approach is on the way shortly.  And the proposed solutions will have little to do with the underlying problem and everything to do with the symptom.

After all, what better way is there to protect your children’s safety than better armed grade-school teachers in the classroom and more sensitive metal detectors at the entrance.