Black Swan in News & How It can Create Jitters for Investors with Bullish View Investing com India

nassim nicholas taleb

The Lehman collapse in the year 2008 was one such event which took the financial markets by surprise. It created a ripple effect not just in the US markets, but financial markets across the globe. Jellyfish blooms, thus, provide the ideal representation of post-normalcy in the unthought future. Can Black Jellyfish be the best metaphor for this pandemic – an unknown known?


Perhaps the more effective argument would be our species’ ability to imagine a better tomorrow is our best and worst enabler. I feel the entire book be summarised by the fact that unexpected stuff happens and this can have profound effects on the world. We can’t model for it and people who try to predict the future particularly in finance are kidding themselves. He rails against current risk mitigation models incessantly by correctly identifying that they don’t work particularly in regard to extreme events.

For instance, the COVID-19 pandemic isn’t the first deadly virus to hit humanity. India has dealt with the Influenza outbreak in 1918, the 1994 plague and the 2009 swine flu outbreak. An effective way to deal with a black swan event is to learn from past events. Let’s explore the complex nature of black swan events and how dramatically they can change the world as we know it. Adaptability to strange, weird, or unexpected occurrences is the essence of successful leadership, regardless of industry or organisational level.

Black Swan Explained

In any case, the world seems utterly unprepared – it seems to have not learned enough lessons from the past. Hopefully the post-Covid-19 world will not refrain from doing reality checks for jellyfish regularly. Yet at times, especially in the second section, I found it hard to listen, not due to difficulty in understanding the book, but due to some repetition and self glorification. It is for the phrase “black swan” and the idea of the ludic fallacy that I am glad to have read the book. Had Taleb had a better editor, or perhaps that he had listened to the editor he did have, I would have given the book another star.

For starters, it is called black swan because it is hard to predict. When black swans become predictable they become white swans. Interestingly, Taleb’s book predated the 2008 global financial crisis – a black swan event triggered by a sudden crash in the booming housing market in the US. The fall of the Soviet Union, the terrorist attack in the US on September 11, 2001, also fall in the same category. A study by the Reserve Bank of India has spoken about the possibility of capital outflows to the tune of $100 billion from India in case of a major global risk scenario or a “black swan” event. The Black Swan theory or the theory of Black Swan events pertains to a rare, unpredictable event that comes as a sudden surprise with a significant impact on society or the world.

  • They must prepare, if not brace, for the stress of what multiple-path planners call a worst-case scenario.
  • On the other hand, the VIX, which measures global risk aversion, is what propels capital outflows.
  • Is derived from this unprecedented spotting from the 17th century, and how it upended the West’s understanding of swans.
  • Aronofsky’s reputation as a filmmaker has only been enhanced by “Black Swan,” which is widely regarded as one of his best works.
  • He also believes that eating kid’s ice-cream is the best way to teach them taxes.
  • Her violent physical altercation with Lily has sudden camera switches where we see her fight—not Lily, but herself.

According to the Black Swan theory, what you don’t know is much more important than what you do. You can use all of your experience to plan for what you think is a possible scenario, only proven wrong by a single Black Swan event. I think that Taleb is probably an S.O.B. and a nut….but his argument that the world is in reality ruled by unpredictable large-scale events is intriguing and forcefully argued. Taleb’s background is in quantitative trading…and while arrogant beyond belief his arguments seem hard to dismiss.

Recently, RBI study has found that capital outflows of $100 billion are likely to take place from India in a major global risk scenario or a black swan event. Nassim Nicholas Taleb, a finance lecturer, author, and former Wall Street trader, coined this term. Taleb published a book about the concept of a black swan event in 2007 before the events of the 2008 financial crisis. The author recommends leaving many books unread in the library.

Black Swan Events and Investment

This was due to venture funding of Internet-based companies, speculation and fad investing. These events have a substantial—and sometimes irreversible—impact on the world. Depending on the situation and the people involved, leadership styles must also be diverse, fluid, and manoeuvrable. Covid-19 was a Black Swan event that transformed the leadership landscape. The effect of Covid on leadership will be discussed at a later date.

I agree with the black swan explained’s main point and the narration was good, considering the problematic writing. There were just too many things wrong with this book to allow me to recommend it to anyone. The author has one good point then rants rather incessantly about a wide variety of people and subjects. It is not the kind of book that will keep you interested in it. If you are listening while doing something else also then high chances of getting drifted away.

When business gets back to usual, companies may take tough decisions such as no increments or layoffs. Be prepared for such situations both from a mental and financial perspective. You can use this time to think of your career path and decide on steps to take towards your ambitions. The coronavirus outbreak is leading to multiple economic problems worldwide.

Is Hustlers Based on a True Story? Plot and Ending Explained

Take the case of the mass popularization of the internet in 1995. For the first time, the internet was actually made available to the people at large. Over the last 20 years, the value created by the internet probably runs into trillions of dollars. At that point of time it was hard to predict that the impact would be so huge and so long lasting.

  • Aronofsky’s direction and the outstanding performances of the cast, particularly Portman, make “Black Swan” a mesmerizing and unforgettable experience.
  • The author recommends leaving many books unread in the library.
  • The greatest benefit of this book, if it stays with you, is to make you conscious of how little you know about the reality, and how little statistics can be trusted.
  • Jellyfish blooms, thus, provide the ideal representation of post-normalcy in the unthought future.

Make sure they understand that the projects they’re working on will help the business survive and improve its market value. They are in touch with their human side, and a greater ability to be present and engaged with others. They pay more attention to what they hear than what they say. Best stock discovery tool with +130 filters, built for fundamental analysis. Profitability, Growth, Valuation, Liquidity, and many more filters. Search Stocks Industry-wise, Export Data For Offline Analysis, Customizable Filters.

This is an interesting read if you can get past his bragging. You’ve probably heard of it and it does a pretty good job of demonstrating the fierce power of the unexpected to trip up the unwary and how much cleverer the author is than anyone else. I decided to write a review after listening to the book twice and enjoying it greatly both times. I didn’t think readers were getting a fair representation of this book’s contents by just reading the previous reviews. Conventional approaches rejected mercilessly but given credit when due. While the author does his best to keep the text easy to follow there are moments in the book where the reader / listener will have to focus intensely to get the point.

But instead, if his investments are spread across equities, liquid assets, and gold then the damages will be lower. Anyways, this concept of seeing something rare and totally different is not only limited to swans or birds. But you don’t want to be someone who thinks every other hiccup is a sign of the impending doom. In both business and investing, it’s a good practice to be on the lookout for them.


The author promotes himself as a skeptic but presents as a deeply entrenched cynic – an insightful ‘philosopher’ wronged by a world that consistently fails to recognise and remunerate his musings . Taleb comers across as arrogant and infinitely unlikable but knowledge of the ‘The Black Swan’ concept is a MUST for all investors. I also suggest further research on the barbell investment theory.

Thus, the coronavirus outbreak was among “knowns” – it was anticipated, at least by experts. It drew tremendous public attention, although the idea itself was quite old. In 1955, psychologists Joseph Luft and Harrington Ingham developed the concept of “Johari window”, which helps people better understand their relationship with themselves and others.

The effects of black swan events are magnified and tend to be catastrophic primarily because they confound our expectations that a universe is an orderly place. A Black Swan in finance is an unpredictable event that is beyond what is normally expected of a situation and has potentially severe consequences. This theory is basically a metaphor that describes an event that comes as a surprise, but can have a major effect.

I agree with the authers black swan theory but it really didn’t need 13hrs of explanation I should of listened to one of the Black swan explained summary books. Is one of the most recent and well-known black swan events. The term ‘Black Swan’ is a metaphor as well as a reality, derived from the discovery of the Black Swans in 1697 by a Dutch explorer in Australia. Until then, the Old World held this belief that all swans are white and the sheer degree of unpredictability of the spotting of this creature exposed the human understanding of its limitations and restrictions. An event that is beyond any expectation of how a situation would play out, leading to severe consequences. Even though they seem unexpected, something similar is bound to have happened in the past.

Black Swans are generally considered to result in negative connotations but the result generally depends on the perspective of the individual. Take the example of John Paulson during the 2008 crisis or George Soros in 1992. One example would be the Universa Investments fund run by Taleb and Mark Spitznagel. Its returns for 10 years prior to the pandemic were low or loss-making.

Over worded, antagonistic and arrogant approach to explaining the concept. Had to sort through a lot of hot air to home in on the main points of the theory. The content is good and the book does cover a lot of relevant information, simply explained, which has changed the way I think forever. This pride comes over as smugness, but that aside this is a very interesting take on the world we live in. The reader also conveyed the impression that the author was intensely arrogant and self-satisfied, which put me off somewhat.

The author is a little full of himself, but that’s part of what makes it fun. I kept listening (I’m new to Audible) for the great thought to emerge to justify all the stultifying time I had spent listening so far. Had I the book on paper, I would have been able to skim it, see that there was nothing there and save myself the time. Unfortunately The Black Swan is also laced with assaults on multitudes. The attitude of the author is so pompous and pretentious and tinged with insecurity and even self-loathing that it is literally uncomfortable to listen to. I could go on and on, barely a page went by without something causing me to cringe, shake my head, or groan.

Explained: What is a Black Swan Event –

Explained: What is a Black Swan Event.

Posted: Sat, 25 Jun 2022 07:00:00 GMT [source]

A Black Swan is a rare event that comes as a surprise, has a major impact, and is often inappropriately rationalised with the benefit of hindsight later. In the final scene, as the white swan leaps to her death, Nina’s bloodstain from the stab wound grows, making this the fall to her actual death. When the Black Swan possibility looks distinct and looks multi-dimensional, it is better to attach puts to your portfolio to avoid the risk of open losses. If the black swan turns out to be positive, you are better off with your assets after covering your option cost. If the black swan turns out to be negative you can fall back upon the put option to make money for you. Grey, and even more so black swans, are viewed in a different way, causing occasions that can be probably devastating for many.

In Black Swan, Portman plays Nina, who lands the lead role in a significant production of Swan Lake. She’s tasked with enjoying each the harmless White Swan and the darker, more sensual Black Swan — each of them avatars for characters competing for the love of a prince. Nina, who is considerably reserved, struggles with taking part in the Black Swan. A rare black swan has been spotted more than 9,000 miles from its native habitat drifting down a river in the West Midlands.

Chinese research vessels operating close to India’s areas of national interest pose a challenge: Navy Chief – The Hindu

Chinese research vessels operating close to India’s areas of national interest pose a challenge: Navy Chief.

Posted: Sat, 29 Apr 2023 12:14:00 GMT [source]

Since black swan events are random in nature, they are hard to predict; both in the timing and the magnitude of the event. Black swans in the stock market have struck in a variety of ways. For global markets, the tech bust of 2000 and the sub-prime crisis of 2008 were hard to predict. For example it was almost hard to predict that marquee companies like Enron, Bear Stearns and Lehman Brothers could go bankrupt.






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