The language of business can be surprisingly vigorous. I love the bestiality of its bulls and bears and dead cat bounces.
I’ve only just discovered a new phrase, this one with a tangential Australian connection. A Black Swan Event, according to a newish book by Nassim Nicholas Taleb, is an event that comes as a surprise, has a major impact, and can’t be predicted but which in retrospect, could have been expected.
What we call here a Black Swan … is an event with the following three attributes. First, it is an outlier, as it lies outside the realm of regular expectations, because nothing in the past can convincingly point to its possibility. Second, it carries an extreme impact. Third, in spite of its outlier status, human nature makes us concoct explanations for its occurrence after the fact, making it explainable and predictable.
I stop and summarize the triplet: rarity, extreme impact, and retrospective (though not prospective) predictability. A small number of Black Swans explains almost everything in our world, from the success of ideas and religions, to the dynamics of historical events, to elements of our own personal lives.
Taleb, in New York Times, 22 April 2007, quoted in Wikipedia
Now who am I to question someone whose book was on the NYT bestseller list for 36 weeks, but this sounds to me basically what we historians call contingent events, and which Dick Cheney more succinctly described as ‘shit happens’. Continue reading