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the blog of l.arrieta

the blog of l.arrieta

risk, fragility, leverage, survival... oh, and the classics

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I publish slowly and irregularly

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the friction problem

if you don’t inherit friction from the world and are traveling through Extremistan, it may be wise to design your own friction: embrace the beauty of logistics, accept multiple stops along the way, say “no” when in doubt, study the classics.

leverage is TNT

leverage exists, but is always paired with constraints. Physical limits (think size or speed), cultural friction, or some other factor that prevents scaling out of control and keep the thing going (i.e., alive, not extinct, not permanently ruined)... but in our wonderful world of finance...

wealth is abstract, ruin is concrete

the asymmetry of ruin: scalability and lack of friction can turn ordinary mistakes into terminal events

virtue over fortune in investing and other pastimes

since you can't help yourself, then let's use the word "virtue" for the disciplined application of your method, and the word "fortune" for the outcome of your "investments."