Optionality: How to Survive and Thrive in a Volatile World

As Matt Ridley points out in The Rational Optimist, in human-power terms, that’s the equivalent of having 150 slaves pedalling on bicycles for eight hour shifts. And that’s the average: if you’re an American, you have the equivalent of 660 slaves constantly working to sustain your lifestyle. Only a mighty Emperor could have dreamed of that sort of

In defiance of the general air of doom and gloom, Keynes predicted that accelerating progress in science and technology would bring about a new age of abundance. By 2030, he suggested that the 'economic problem' would be all but solved, our standard of living would have increased as much as eight times over, and we’d be putting in lazy 15 hour work

By restricting your choices along one dimension, you can create more freedom along a dimension that’s more important to you. Almost every life philosophy—minimalism, Christianity, the Paleo diet, whatever—boils down to this kind of trade-off.

Nassim Taleb calls a ‘non-scalable’ career. A plumber can only fix so many taps. A baker can only bake so many loaves. A lawyer can only represent so many clients. Artists—which includes anyone from writers to musicians to entrepreneurs—don’t face this bottleneck. Something idea-based can be sold over and over again with almost no extra time or eff

PRAXIS. (noun) from the ancient Greek πρᾶξις: The process by which a theory or skill is enacted or realised. Putting ideas into practice; concrete action; doing.

we might say there are four types of capital that make up the raw materials of optionality. 1. Financial Capital Your assets minus your debts, which is strongly influenced by the simplicity of your tastes (how little money you require). 2. Social Capital The strength and number of your relationships with friends, family, colleagues, and communities

the second timing factor: volatility. In domains where nothing ever changes, there's no point in constantly opening new options, and you can shift most of your efforts to exploitation fairly early on. But high-volatility domains reward us for constant exploration, and punish those who switch to pure exploitation too early in the piece.

In the language of optionality: having first opened as many options as possible, and secondly, exploited those that are most useful, then, give them away. This order is important. Without a buffer of optionality to protect against shocks in your own life and open up opportunities, you have no ability to take risks.

The secret to psychological wellbeing lies in the gap between what we expect from the world, and what it delivers. Cap the downside by setting your expectations as low as possible, and then look for experiences that create plenty of room to be surprised on the upside.