ImageNations

Nassim Nicholas Taleb in Black Swan - the Impact of the Highly Improbable , the second book in the trilogy referred to as Incerto, discusses rare and consequential events, which, because they occur at the tails are almost always ignored and easily explained away after they have occurred. The experts, in the fullest exhibition of their epistemic arrogance, predict that such events are one-time events and would never occur again and so are always fooled by the randomness of their occurrence. These events, in the 4th quadrant, are extremistan events. In Antifragility - Things That Gain from Randomness (Random House, 2012; 519), Nassim explains how we can benefit from these rare and consequential events by decreasing our downside to it or by employing the technique of skin-in-the-game. The book shows how we can avoid becoming the turkey which was surprised on the 1000th day after having been fed consistently for 999 days.  According to Nassim, Black Swan events are needed to mak...

Nassim Nicholas Taleb's The Black Swan: The Impact of the Highly Improbable* (Random House, 2007; 444) is a revolutionary book that spares no word to describe how nonsense the tools of probability are in forecasting the most important events in the world today like the Financial Crisis, the advent of computers and many such events which all exist in extremistan. Nassim Taleb divides the environs within which events occur into two: mediocristan and extremistan. Mediocristan is where the usual rise and fall occurs. Events that occur in the world of extremistan are somewhat predictable and so their impact has less consequences. For instance, the population of a country in the year n+1 could be pretty well predicted; however, that a plane will fall from the skies and decimate a whole village is wholly unpredictable and these events have large consequences. A simple example given by Taleb is the 2008 Financial Crisis, something he wrote about even before it occurred. None of the high...