Antifragility, The Game of Jenga, and the Markets: Why Financial Crises Will Only Get More Severe

In a game of Jenga, the tower of blocks is stable at the beginning of the game. It takes a relatively large shock, like someone outright knocking the tower over with their hand, to collapse the system. However, as the game goes on, the tower of blocks becomes more fragile. As each successive piece is removed, the system becomes exponentially more fragile so eventually only a very tiny stress is all that is needed to send the blocks crashing down to the table. Continue reading “Antifragility, The Game of Jenga, and the Markets: Why Financial Crises Will Only Get More Severe”