black swans

At a recent talk, someone asked me to identify the four or five black swans most likely to materialise over the next five years.

Payment by results is an attractive idea, but in a world where black swans can be deliberately manufactured, results can be treacherous.

In his bestseller The Black Swan, Nassim Nicholas Taleb, an expert in mathematical finance, calls extreme events of this kind black swans.

But in 1697, the Dutch explorer Willem de Vlamingh found masses of black swans on what became known as the Swan River in Australia.

Before the crisis they were looking at things like pandemics, cyber-security and terrorism as possible causes of black swans.

There were no black swans or swans of any colour involved.

It turns out that in financial markets "black swans" , or extreme events, occur much more often than the usual probability models suggest.

But amid so many black swans, investors should not take their eye off the white ones.

In The Black Swan, I say that in the historical and socioeconomic domain, black swans are everything.

The Quarterly: Say a little more about the relationship between black swans and the global financial crisis.

Nassim Nicholas Taleb calls such unlikely events 'black swans. '

You've never seen a black swan. So, you end up going through life assuming that there are no black swans.

Number two, minimize your exposure to negative black swans.

Talib, who's a Wall Street professional, talks about these black swans as being the real story of finance.

In fact, I tried in The Black Swan to turn a lot of black swans white!

This is Nassim Nicholas Taleb's message when he warns of "black swans" .

In other words, a place more resistant to black swans.

About a quarter of male black swans only use a women swans for their eggs.

If you ignore black swans, you've got nothing.

"Financial markets are not only vulnerable to black swans but have become the perfect breeding ground for them, " says Mr Guldimann.

We also have some psychological blindness to black swans.

There have some black swans, even more outstanding.

For some animals, homosexuality is normal flock behaviour. For example, it is common for male black swans to raise cygnets as a couple.

It can draw attention to "black swans, " which are major risks that conventional forecasting tends to ignore. 1

But, as Japan shows, black swans do exist;