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Nassim Nicholas Taleb, The Black Swan (2007)Nassim Nicholas Taleb, The Black Swan (2007)


Taleb (pictured right) is a professor in New York and writer.

This best-seller has been hugely influential in explaining unexpected events like:

  • 9/11, the terrorist attack on New York's World Trade Centre.
  • the 2007-8 global banking crisis.


Book summary

 Nassim Nicholas Taleb, The Black Swan (2007)

What is a Black Swan?

A Black Swan is an event that

  • is an outlier (unpredictable, rare and totally unexpected).
  • has an extreme impact (good or bad).
  • is consequently made explainable and predictable (by creating reasons for it).


Why  is it called a Black Swan?

Because people thought that all swans were white until black ones were unexpectedly discovered in Australia.


Other examples of Black Swans...Nassim Nicholas Taleb, The Black Swan (2007)

  • Google.
  • the Internet.
  • 9/11 (pictured right).
  • the 2007-8 global banking crisis.
  • the outbreak of the First World War in 1914.
  • extreme, unexpected events in our personal lives.


Why are Black Swans becoming more likely?

The future is increasingly unpredictable .

So any organization must have a plan to deal with Black Swans.


Why do we ignore Black Swans?

Because we:

  • ignore the possibility of the random and the extraordinary.
  • concentrate on minor details to the exclusion of possibly significant events.


How to identify opportunities from Black Swans

(called positive Black Swans, which we should aim for)

 Nassim Nicholas Taleb, The Black Swan (2007)

1. Imagining the impossible and totally unpredictable

(for example a revolutionary product like Google that far exceeds customer expectations).

Accept that the past bears no relation to the future.


2. Avoiding simplifying and categorizing things

Accept the world is:

  • unpredictable.
  • imperfect.
  • complex.

 Black Swans make inappropriate...

...ideal and well defined concepts like rules and forecasting models (derived from Plato’s philosophy, or “Platonicity”).


3. Accepting that what you don’t know is far more important than what you know

Before 9/11 the knowledge that New York was an easy terrorist target didn’t stop it happening.Nassim Nicholas Taleb, The Black Swan (2007)

Learn from:

  • past Black Swans.
  • why people didn't predict them.

Don’t be surprised when they happen.


4. Thinking about general significant ideas not specific, unimportant facts

  • beware of experts (whose knowledge has no relevance to the future).
  • make time for thinking about the unusual and unknown.
  • avoid “small talk, focusing on the known, and the repeated”.

 Nassim Nicholas Taleb, The Black Swan (2007)

5. Challenging conventional wisdom (existing knowledge and ideas)

  • change your beliefs and assumptions (when contradicted by new evidence).
  • avoid dogma.


6. Focusing on the rare, volatile and extraordinary, not the normal, stable and ordinary

Imposing order on volatility (like restricting people’s freedom as in the Middle East) can lead to even greater volatility and chaos.Nassim Nicholas Taleb, The Black Swan (2007)

Accept the world of unpredictable extremes (Extremistan) not just the Mediocristan world of:

  • averages.
  • predictability.
  • normal distribution (the “bell curve”).


Three other tips

 Nassim Nicholas Taleb, The Black Swan (2007)

1. Don’t think you’re in control when you’re not

(the illusion of control).


2. Don’t think that doing something is always better than doing nothing

(the action bias)

Attempted reforms can have harmful, unintended consequences because of the imperfections of human nature.

 Nassim Nicholas Taleb, The Black Swan (2007)

3. Avoid oversimplified story telling

(the narrative fallacy)

This describes the world as:

  • less random and more predictable  (than it really is).
  • too comforting.
  • oversimplified. 


Tips for personal and business success

 Nassim Nicholas Taleb, The Black Swan (2007)

1. Aggressively pursue the opportunities of positive Black Swans 

(which often come from luck, so seize your lucky breaks!)

Remember you are a Black Swan, because you are extraordinarily lucky to be alive!


2. Don’t be dictated to by other people and external events

  • use extreme events as a starting point.
  • don’t treat them as exceptions to be ignored.

 Nassim Nicholas Taleb, The Black Swan (2007)

3. Focus on your aims

Don’t be distracted or misled by:

  • useless minor details.
  • experts and forecasters (whose knowledge is obsolete and wrongly based on a predictable world).

 Nassim Nicholas Taleb, The Black Swan (2007)

4. Be creative

  • look for extremes.
  • think the impossible.

Key quotes on decision making

Our world is dominated by the extreme, the unknown, and the very improbable.

This is a book about uncertainty; to this author, the rare event equals uncertainty






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