Black Swan

I’m currently pounding my way through The Black Swan by Nassim Nicholas Taleb. What a stellar read. Briefly put, a Black Swan is an improbable or unpredictable event that has three aspects: it’s unpredictable, it has a massive impact, and we develop retroactive explanations in an attempt to justify it. 9/11 is everyone’s favorite example, but a Black Swan can be much smaller in scope and scale.

Taleb is one of those guys that are so smart it’s a bit scary. He’s an old-school, well-rounded thinker; educated like we used to do a couple of generations ago. He could probably pass this one with no trouble at all.

A brief little excerpt is in order.

To Be Wrong With Infinite Precision

We harbor a crippling dislike for the abstract. One day in December 2003, when Saddam Hussein was captured, Bloomberg News flashed the following headline at 13:01: U.S. TREASURIES RISE; HUSSEIN CAPTURE MAY NOT CURB TERRORISM. Whenever there is a market move, the news media feels obliged to give the ‘reason’. Half an hour later, they had to issue a new headline. As the U.S. Treasury bonds fell in price (they fluctuate all day long, so there was nothing special about that), Bloomberg News had a new reason for the fall: Saddam’s capture (the same Saddam). At 13:31 they issued the next bulletin: U.S. TREASURIES FALL; HUSSEIN CAPTURE BOOSTS ALLURE OF RISKY ASSETS. So it was the same capture (the cause) explaining one event and its exact opposite. Cleary, this can’t be; these two facts cannot be linked. Do media journalists repair to the nurse’s office every morning to get their daily dopamine injection so they can narrate better?

I didn’t select the above section just because it bangs on the media, my favorite punching bag. I think this book and Global Brain should be used as texts in a course that should be required for all college students: Modern Cognition. Makes that Logic and Contemporary Rhetoric class I took as a freshman seem pretty pathetic. More to follow as I digest this one.

Ares