How the Social Fabric Works: A Conversation With Nassim Nicholas Taleb

welcome to civil net this is your host Eric copian today we're honored to have as our guest Mr Nasim Talib uh Mr Talib is one of the most prominent thinkers of our time and he's also an author and a famous traitor he's best known for his works like the Black Swan which focused on the extreme impact of rare and unpredictable events on the world Welcome to our program Mr TB and Welcome to our media thank you I'm extremely honored to be in Armenia I feel like I've been here in the previous life you might you

you probably have been probably uh I'm going to start uh I didn't want to have rudimentary questions I want to have Universal questions because of your reach so the first one I was going to start it's tagged under Armenia and it's tied to one of your Concepts which is this issue of robustness yes we in Armenia from September of 2020 to September of this year we went through uh a complete what lack of a better word be a system failure and we had a stress test for The Armenian country and nation and on many levels

we failed and we paid for it in ethnic cleansing and what we saw what happened in nagoro kabak in just literally two months ago so we're obviously this nation is focused on building robustness uh on some level successfully on some level not so successfully yet but I want to this concept of stress test and robustness is usually seen in the context of corpor ations and not uh I mean let's look at it from the context of a state I see for the purposes of the state of the Armenian nation and the state what does robustness

mean in Practical terms uh it you you got to look at it many levels uh this is uh something I studied uh in uh about 2013 2012 when I had this idea uh that uh a country that doesn't have a lot of variations is not stress test and and can be very U unstable without knowing it hides its risk and uh I gave U people in DC uh the example of two countries which one is more stable this country had the same government since 1973 uh this the other country had 50 governments since 1945 and

of course analysts said that the country that has different governments uh was less stable than the one that had only one government and was that Italy Italy versus Syria yeah MH actually added Saudi Arabia yeah so uh okay the after I mean I I never thought that that the idea would uh interest policy makers in DC until I was approached by the rent Corporation and they say what do you mean I told him yeah the more variability the more you've tested uh How Country operate plus there's another thing um at a time nobody knew about

heart rate variability which mean you know how you have an Apple Watch it tells you your your best predictor of death is a constant heart rate so it means that you're you're because the environment is not constant never constant that's symbolically interesting so so so you you so the the and actually we know already from uh Finance uh that the best indicator a failure of company is stable income stable revenues and uh in a crisis 2008 the funds that had the the most uh steady um income were the first to go bankrupt made off constantly

making more money every there we go there we go so so so the the uh so we apply that to countries I had already done some work on currencies by showing that a currency had a remarkable stability to the dollar usually collapsed Argentina and then of course after that Lebanon so uh we already had enough uh uh you know studies on systems to now try to apply to countries so wrot this report with a fellow from the Rand and we published in um in uh foreign affairs that that you you should take volatility internal turmoil

provided you survive it as a sign of Health we studied Armenia but uh in a report that was classified at some point because for US Government we studied Armenia and effectively Armenia had its real stress test uh upon the collapse of Soviet Union and if you make it through that collapse uh you're doing very well so uh moving on to the second question um a lot is heard in the world World about this idea of AI and how revolutionary it is uh and I know you're a counterintuitive thinker is you know there's people who say

AI is going to take over and destroy the world there's people who say that it's quite you know it's it's not that big of a deal is AI just the glorified Advanced uh you know Google search what are we talking about and how transformative is it going to be to our lives okay so you you answered it by saying glorified Google search let's not there's a lot of AI there's learning llm uh the language large language model and then you have uh Robotics and then of course you have um machine learning uh let's say that

AI what you call broadly robotics they can't climb cannot climb stairs so taking over the world it doesn't require climbing stairs so in other words we focus because of a bias a journalistic bias on what things can do which is is a sent and not on a comprehensive test of its capabilities but let me talk on the one I got familiar with the L&M the language models they basically deliver the most likely explanation on the web you're never going to make a a penny in your life going shooting for the most likely explanation and you're

never going to get rich starting a business based on that the problem is of of course that it follows too much common sense Elementary Common Sense it delivers what's mean the current Prejudice you have and and of course you can't get an Einstein using a previous belief by definition science is a revision of current beliefs okay challenging by definition and and you're never starting a business that makes sense doesn't work because plus you don't know because other people would have started probably and now we got rich from it so this is why you're you're you

have a selection bias there so uh plus there are other tricks to trick the system it always deliver statistical thing and now in the future we're going to have a problem because of what I call the self-licking lollipop because a lot of the web now is populated by these models learn language models the information and which feeds into learning mhm so we're ending up in a in a in a very circular self feeding loop self-feeding loop what call self-licking lollipop right so so we I mean of course there huge use for AI it's like I

was you know when I started trading I have I'm not very good with numbers I'm good with math but not numbers I didn't know that so I needed the 12C calculator and without 12C calculator I wouldn't have survived it's it's it's the same thing some tools help you do stuff you would do otherwise to free you up to think and I think that uh that AI will help us in many areas I I I keep mentioning translation it transform the translator into an editor so you can translate books a lot faster but it's not sufficient

that's an interesting answer it does it does definitely help the professional yeah I think it's it's it's a specialized help and not Universal exactly now we're going to jump to something entirely which is the issue of culture uh there's we me and you probably don't have a lot in common except one thing which is uh I was born in the East I move to the west and I move back to the East and you live between Lebanon the United States you know you have both and one of the things which is interesting to me is

how comfortable cultural life is in Armenia in the sense that there's no and I think this is true of other countries in this part of the world in which there's no issues of identity there's no issues of uh all of these cult Wars that are happening in the west yes and uh you know there's a lot in this part of the world we usually learn we must learn from the West on many things that are relevant economy technology and other things but I think this is the one place where I think the West can take

lessons on in In Living in a world where the personal is not always political what is it in the western world that that can be learned about the way cultures in this part of the world work to lessen the impact of these cultural wars in the west okay what I think the I mean the cultural Wars cannot occur in Armenia for a simple reason that you don't have uh the imbalances that you have in the west I mean you had slaves in the west let's remember and and once you freeze you know people they want

full equality nothing short of full equality and uh count to what people believe uh women in our culture because we're part of that zone that East Med toia Caucasus Zone women here were not as mistreated as they were in European cultures they were people don't realize that they had a lot more power of decision I mean it was part of the fabric of society so we don't have these kind of imbalances very strong imbalances they have in the west and they're compensating for it but there's so but there's one thing that we understand this part

of the world and they don't understand there that most people live for the funeral how many people are going to show up at your funeral and this is pretty much a way we measure people in the East and in the west it's not no matter how much money you have if you don't have that social fabric um around you in which you're fully integrated it's not going to work so this I've learned from I spend a third of my time in Lebanon or maybe a little less than a third of my time in Lebanon and

I just realiz realiz how important it is to be embedded into that Society by delivering for example in skin in a game I speak about reciprocity I take your risk and stuff like that but skin the game is also no cheap signaling and uh and and I feel like attending people's funerals is not cheap signaling so you have to travel you got to do things and and I do that when I'm in Leon or when I come back I go pay visit the condolences you feel like automatic you're part of the fabric of society and

people like it they respect you better for for these things rather than other attributes you may have how many books you've written or what it doesn't matter for them it matters for them that they got this respect that's not part of the modern society probably part of the older um uh you know but it's not part of modern society that largely due to um Mobility physical Mobility people migrate too much within the United States and the friends you're going to have on the internet are not going to be there and they're not I don't know

if they're real friends and some of them actually don't exist it could be some uh Bally if they're really pretty girls exactly exactly so so this is something they can learn from us um I just like you live uh here uh you lived in Estates where where's life better here there you go and same thing people who don't earn their money in Lebanon if you earn your money it's better to earn it in States if you want to live you better live here don't earn your money 11 because a lot of headaches around you know

surrounding how regul a lot of things all right and and you want to spend it people say there's no place like like our part of the world because and say our part of the world is because maybe for you Armenia doesn't have a lot of Lebanese influence but Lebanon has a lot of arm influence you seeig I mean it's part of the fabric of society and you have by contamination people start resembling one another across ethnicity across we call ethn religious groups and we have two uh uh Armenian uh groups in Lebanon Armenian Catholic Armenian

Orthodox you know and they're part of the fabric of society so everybody's a littleit Armenian uh I'm going to move on as was fascinating answer just I usually don't comment on answers but that was exceptionally insightful I want I want to move to the world of politics and one of the biggest phenomenons we've had in the world is is uh lack of a better phrase especially in the west Democratic world is this populist some of it is fake some of it is real Argentina the United States some of it entirely contradictory we saw at Holland

this week and one of the most consistent things that I see is to the extent that the political Elites across the West uh the sort of the elite consensus is in is is probably in Greater contradiction to what ordinary people think or feel uh about their lives which are getting worse from an economic standpoint or cultural changes that they never voted for and I was sort of struck by this two three days ago with the death of Henry Kissinger you know yes you went on Twitter and the first thing was finally you know Henry Kissinger's

you know it was all the negative things from Ordinary People while the entirety of the western elite were appraising this man like he some version of the Pope to me that was just very symbolic what do you think explains this disconnect and what is this disconnect going to lead to yes so I I wrote a chapter in skin in the game my last book called iyi intellectual yet idiot and uh and we live in a world where you have what you call Elite is effectively a certain cast of what the French called M Mandarin but

but in reference to the scholars of China who ran the Ming Dynasty and they only learn from one another no contact with reality in socioeconomic life and that just doesn't apply to Henry Kissinger it applies to monetary policy it applies to many other things the problem is breaking that mold comes with a lot of side effects so in other words I you know I I don't mind breaking the foreign policy establishment of the United States because it did more har to the United States and good not just Afghanistan unconditional support to Israel because of the

lobby all these things have harmed the United States but but I'm also talking about um uh but so so breaking about breaking some establishment like the medical establishment would be harmful because it is a rigorous uh establishment that works well so some establishment work well and some don't and actually I I'm going to reclassify that I had in my uh uh book The Black Swan I spoke about real expert versus pseudo expert a a plumber is a real expert a dentist is a real expert at Dentistry a a political analyst isn't one is definitely not

one and and an economist definitely not one and a foreign currency foreign foreign uh foreign no foreign policies thing and a journalist in Lebanon is not one because they describe things with Distortion so you need to break some establishments not others and I'm I'm so I I truly believe that that we got to retain some establishment but just get rid of uh others now uh Henry Kissinger to me is a criminal war criminal as you noticed from from the on the web it's a generational thing uh it's a establishment thing but if you notice the

generational Gap now let me let me tell you what's happening now and how we breaking through this establishment um I think I discussed it in skin in the game we're going back to the past in the past where did you get your news from Barber yeah neighborhood yeah the neighborhood fish I mean fish mongers taxi drivers now taxi drivers but you got your news but but people contributed to the news they gave you news you gave them news so it was two- way then then we spend about a century almost sitting down and getting the

news from a TV set professionalizing it not exactly not contributing and now we're going back to the social media people are trying to control the discourse on social media it's impossible because with journalist it's very easy to control them in the United States because you get fired you say something Murdoch doesn't like but in on the internet you and I I can you know can say that apples are not good for your health whatever you can say whatever you want nobody's going to restrain you and censorship can be dealt with because you can refer to

something using euphemism so we don't have to worry about censorship we may have to worry a little bit but not seriously about censorship so what has happened is an intergenerational Gap in the way those old people are used to the news take for example something as Elementary as support for a certain country a certain War that's taking place now over 65 overwhelmingly in favor of one side under 30 entirely different enti complet over the other the other way so you have an intergenerational Gap that maps to how people get the news but I think that

generation when they rise up we we'll think differently populism is to me I don't like that term populism because we're in the Democratic world you see so I mean we using popular you're using election which is basically a vote for the most popular person however uh um and you know letting people called populist come to power will have some benefits um and the main benefit is that they will um they probably will not be able to deliver all their elector electoral promises because there's a structure in place and it don't mess with that structure but

they will will you know the world upset the apple cart they will upset you know that that system uh I think I'm going to I'm going to close this our last question and uh I can't obviously we most people watching the show care about Armenia above all others about other things you've been here a couple of days a couple of days is not generally good enough to have a great Insight but sometimes The Outsiders view is is the most valuable because you're not immersed in what we're what's going on here if you can just give

me in a few short sentences positive positive Ledger negative Ledger of what you see in arm media currently and in the future I I I um I mean I'm as you know I I I write books mostly so I'm it takes me 20 years think about the problem before commenting on it okay um and if you see my previous answer i' answered from my books things covered in my in my in my books Armenia was not part of problem but what I can say in general again that it's a country that went through a big

sh economic shock in the 90s just went through shocks and and it's bouncing back and then also it's been helped ironically by recent events is that you've had your war in the AR but the Russians messed up somewhere and then you had reverse migration Armenian coming back to Russia and some Russians coming here and and and even if things settled down in Russia it' be a long time before these Armenian would be would feel the need to to leave and and and and and and and even things uh improve tomorrow a large number of these

will stay here so so you're benefiting at least on that score I don't know about the arzak I don't know if that amputation and the ethnic cleansing that came with it uh is not I mean how come it doesn't offend so many people I mean the Armenians Armenia has been shrinking from times IM Memorial uh from tigan mhm to uh to now I mean I've been shrinking it's sad but there's whatever is left of it is probably like let's call it a consolidation mhm uh also I want to mention one one thing that people don't

know I was part of a scientific paper on genetics of the Lebanese uh mountains the Shu or or the the northern mountains the northern uh the Northern mountains were initially uh because we still find ancient Armenian Gene there so it's like we timed it 6,000 years ago people thought that migration of Armenians to Lebanon was 1917 so not no Northern Lebanon has a lot of names sis and stuff like that because of the mtis which were at the service of the emperor uh fighting um you know uh the Arabs so uh and a lot of

them settled in Lebanon and then people thought that that there was a migration in the days of tigran no uh it was 6,000 years ago the early inh of Lebanon and it looks like they brought the wine with them okay the manufacturing of wine with them so well uh it was a pleasure having you on our show uh it was insightful as we expected thank you very much thank you for joining us a civil night today