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#691: Nassim N. Taleb & Scott Patterson — How Traders Make Billions in The New Age of Crisis, Defending Against Silent Risks, Personal Independence, Skepticism Where It (Really) Counts, The Bishop and The Economist, and Much More

The Tim Ferriss Show

NOTE

Identifying Fat Tails in Financial Markets

Fat tails in financial markets are a problem because the smallest number of events have the greatest impact. This challenges the models used for risk management. Identifying fat tails and using refined tools is important. Pandemics and wars are examples of fat tail events. The precautionary principle can help prioritize and manage these risks, like with nuclear energy by diversifying and ensuring it.

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