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The Risks of Not Taking Risks

If you don’t take any risks, you won’t make any mistakes.

Problem is, there’s no such thing as avoiding risks.

Economists make the distinction between transaction costs and opportunity costs. Transaction costs refer to the expenses you incur in the process of pursuing and purchasing a given good or service. Opportunity costs refer to the value of the opportunities you have to sacrifice or forgo in order to be available to whatever choice you actually decide to make.

Every choice has the dual function of opening and closing possibilities. Every yes is a no and every no is a yes.

When you refuse to take a certain kind of risk, you may avoid the transaction costs, but there’s no way to evade the opportunity costs.

Being passive and inactive makes us no less subject to the possibility of loss than being assertive and taking the initiative.

Life is inherently risky. Whether we choose or refuse to choose (which is just another form of choosing), we’re always taking chances.

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