Nassim kicks off The Bank of England’s One Bank Flagship Seminar, the first such seminar offered by the bank in an effort at greater transparency:
The first part of this talk – The Law of Large Numbers in the Real World – presents fat tails, defines them, and shows how the conventional statistics fail to operate in the real world, particularly with econometric variables, for two main reasons: 1) we need a lot, a lot more data for fat tails; and 2) we are going about estimators the wrong way. The second part – Detecting Fragility – presents heuristics to detect fragility in portfolios. Fragility is shown to be ‘anything that is harmed by volatility’. The good news is that while (tail) risk is not measurable, fragility is.
Discussing the concept of antifragility, Nassim remotely addresses the Theory of Constraints International Conference held in Capetown South Africa from September 6th to 9th, 2015. The theme of the conference was how to use the Theory of Constraints to transform organizations and people from fragile (harmed by volatility) to robust (not harmed by volatility) to antifragile (benefiting from volatility).