Edward Quince's Wisdom Bites: The Thanksgiving Series - Taleb’s Turkey and the Black Swan of Certainty

 Ah yes—Thanksgiving. A time for family, gratitude, and the annual retelling of the greatest parable in modern finance: Taleb’s Turkey, patron saint of naïve extrapolation.

The turkey is fed every day.
Every feeding reinforces its belief in a benevolent, orderly universe.
Right up until the afternoon before Thanksgiving, when its philosophical framework undergoes a sudden… revision.

Taleb’s punchline:
“The turkey’s feeling of safety peaked precisely when the risk was highest.”

This is how financial markets behave before Minsky moments.
The longer the calm, the deeper the complacency.
The more stable the environment, the more fragile it becomes.

We confuse “never seen” with “impossible.”
We mistake “historically safe” for “permanently safe.”
We fall in love with our own data sets.

Until we don’t.

Financial Takeaway:
This Thanksgiving, learn from the turkey—by doing the opposite of the turkey.
Stability breeds overconfidence.
Overconfidence breeds fragility.

When everything feels safe, tighten your helmet strap.

Edward Quince's Wisdom Bites: The Thanksgiving Series: The Comfort of Familiarity — Ignoring the World That Just Changed

 One of the great Thanksgiving traditions is pretending the same recipes will work forever. Markets do this too.

Our brains like familiarity. When nothing bad has happened recently, we assume nothing bad will happen soon. This is known as the familiarity heuristic, though “emotional laziness” also works.

Extended calm seduces us into thinking we understand the landscape—right up until the landscape shifts beneath our feet.

“Often we don’t realize the world is changing until long after it has changed.”

Today’s economic environment is full of shifting tectonic plates: labor dynamics, energy transitions, geopolitics, technology, supply chains. Central bankers say the quiet part out loud now: the traditional transmission mechanisms may no longer work like they used to.

And when a regime change arrives, your old assumptions become liabilities.
That beloved negative stock-bond correlation?
Yeah, it may take its Thanksgiving break indefinitely.

Financial Takeaway:
Stability is not safety. Familiarity is not knowledge.
The snowpack looks peaceful—until the avalanche.

We need to fight our instinct for comfort and remember the real job of risk management isn’t predicting the future; it’s building resilience for the futures we didn’t predict.

Edward Quince's Wisdom Bites: The Thanksgiving Series: The Deceptive Calm — Why Observed Frequencies Betray Us

Welcome back to the digital saloon, where the turkey isn’t the only thing getting carved this week. As we drift toward a holiday built on gratitude (and stuffing), let’s give thanks for something else entirely: the humbling reminder that the past is a terrible forecaster of the future.

Modern finance operates under a quiet delusion:
that what we’ve observed is the full menu of what can happen.

It isn’t.

As Elroy Dimson famously put it:
“Risk means more things can happen than will happen.”
A line so simple that most financial models immediately ignore it.

Relying on observed frequencies—the stuff we can neatly count and chart—creates the illusion of certainty. It tells us the world is calm, stable, and predictable. A lovely story, completely false.

The markets live not in the tidy middle of the bell curve but in the uncharted corners. The improbable disasters. The “this wasn’t supposed to happen” events.
If you’ve ever wondered why models blow up exactly when you need them not to—this is why. They are backward-looking by design.

Financial Takeaway:
Don’t confuse the narrow sliver of reality you’ve observed with the full distribution of possibilities. The world is constantly changing, and sometimes the thing that “never happens” shows up precisely because everyone believes it can’t.

Be grateful—but don’t be complacent.

Edward Quince's Wisdom Bites: The Inverse Degen Trader pt.5

 “I’m 100% Sure” — The Four Most Expensive Words in Finance

The Degen Cliché:
"I'm certain. My analysis is flawless. LTCM? Those guys were amateurs."

Translation:
“I have never met humility.”

This is the apex predator of arrogance—a trader who believes the universe takes orders. They confuse skill with luck, precision with wisdom, and backtests with divine revelation.

Every crash in history started with someone who was “sure.”

The Inverse Degen Trader’s Wisdom: Intellectual Humility and Process Over Outcome
Veteran investors know the truth:
Nobody knows anything. And that’s okay.

Forecasting is a probabilistic art form wearing a lab coat. The goal is not to predict the future but to behave sensibly in uncertainty.

Mark Twain’s line (which he may or may not have said, but we’ll use it anyway) nails it:
“It ain’t what you don’t know that gets you in trouble. It’s what you know for sure that just ain’t so.”

Lesson:
Your edge isn’t brilliance. It’s humility. Make “not stupid” your baseline operating system.

Final Analogy:

The degen trader treats markets like a casino—jumping from table to table, chasing the loudest crowd.
The inverse degen treats markets like an ocean.
He builds a sturdy ark (Margin of Safety), loads it with supplies (Patience), studies the currents (Valuation), and sails only when conditions are right.

One gets wet.
The other gets wealthy.

Edward Quince's Wisdom Bites: The Inverse Degen Trader pt. 4

He Who Refreshes His Feed Most Knows Least

The Degen Cliché:
"I need real-time data and 50 Twitter takes before making a move. YOLO the consensus!"

Translation:
“My mind is a leaf blower.”

This trader’s greatest asset is their attention span, which they lend out at 0% interest to anyone posting a chart on X. They confuse data with wisdom, headlines with signals, and activity with insight.

They are the patron saint of the Noise Bottleneck, where the ratio of nonsense to knowledge approaches infinity.

The Inverse Degen Trader’s Wisdom: Clarity Comes from Subtraction
Wise traders subtract, not add.

They understand that wisdom sits at the top of the DIKW pyramid:
Data → Information → Knowledge → Wisdom.
Most people get stuck somewhere around “Information” and never see daylight again.

Clarity comes when you turn off alerts, mute half the world, and return your brain to factory settings.

Lesson:
Filter aggressively. If it won’t matter in five years, don’t give it more than five minutes.

 

Edward Quince's Wisdom Bites: The Inverse Degen Trader pt. 3

 Work-for-Work’s Sake: A Tragic Epidemic Affecting Traders Aged 18–85

The Degen Cliché:
"Patience is for boomers. Real traders make money every day. Gotta churn to earn!"

Translation:
“I mistake activity for intelligence.”

This is the trader who believes the market rewards busyness, as if portfolio turnover increases IQ. They practice a kind of restless financial cardio—burning calories, not building muscle.

They suffer from W4W Syndrome—Work for Work’s Sake—the condition where doing anything feels more productive than doing nothing, even when nothing is the correct answer.

The Inverse Degen Trader’s Wisdom: The Big Money Is in the Waiting
Charlie Munger cracked the code decades ago:
“The big money is not in the buying or the selling, but in the waiting.”

Compound interest is the eighth wonder of the world, but only if you stop poking it with a stick.

Most investors sabotage themselves not through stupidity, but through fidgeting.

Lesson:
Make “strategic inertia” your superpower. Sit so still you become the market’s version of a Zen monk guarding the temple of compounding.

Edward Quince's Wisdom Bites: The Inverse Degen Trader pt. 2

 “Double the Debt, Double the Dream!” — Words Engraved on Tombstones Since 1637

The Degen Cliché:
"Leverage isn't risk; it's maximizing gains. Double the debt, double the dream!"

Translation:
“I’ve never read a history book.”

To the Degen, leverage is a gift from the gods. They view debt like a relationship red flag: something to ignore because the dopamine feels good.

They forget (or never learned) that leverage doesn’t add intelligence. It just accelerates the consequences of your stupidity.

The Inverse Degen Trader’s Wisdom: Survival Is the Only Road to Riches
Ask yourself: What is the one thing every successful investor has in common?

They’re still alive.

Howard Marks said it best:
“Never forget the six-foot-tall man who drowned in a river that averaged five feet deep.”

Leverage erases your margin of safety. It turns small errors into fatal ones. It asks you to be right on schedule, which is hard because the market keeps refusing to follow your Google Calendar.

Lesson:
Fortune favors the unlevered. Or at least the moderately levered and constantly paranoid.

Edward Quince's Wisdom Bites: The Inverse Degen Trader pt. 1

“Only Up” Is Not a Strategy, It’s a Confession

The Degen Cliché:
"I'm buying the top because it's only up from here. YOLO that momentum!"

Translation:
A hope, a prayer, and a total unwillingness to check a long-term chart.

This is the trader who believes that the higher something goes, the more obligated the universe is to keep pushing it upward. They treat valuation like an optional attachment package—like floor mats at a car dealership. Nice to have, but why let it get in the way of a good buzz?

It’s the purest expression of the three I’s of every bubble:
Innovator → Imitator → Idiot.
The Degen shows up fashionably late to stage three, champagne in hand.

The Inverse Degen Trader’s Wisdom: Buy Low, or Wait Longer
Real adults buy cheap assets or—novel idea—wait for them to become cheap. They don’t chase euphoria. They farm it.

Everything in markets (and in life) moves in cycles. Even the mighty tech stock, the beloved commodity, the meme that “can never go down” because it has a cult following and a mascot wearing sunglasses.

Trees don’t grow to the sky.
But they do fall on inattentive speculators.

Lesson:
Be a value sniffing contrarian, not a momentum-addled romantic poet.