Binding: Hardcover
Dewey Decimal Number: 003.54
EAN: 9781400063512
ISBN: 1400063515
Label: Random House
Manufacturer: Random House
Number Of Items: 1
Number Of Pages: 366
Publication Date: April 17, 2007
Publisher: Random House
Release Date: April 17, 2007
Sales Rank: 108
Studio: Random House

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Editorial Review:

Product Description:
A black swan is a highly improbable event with three principal characteristics: It is unpredictable; it carries a massive impact; and, after the fact, we concoct an explanation that makes it appear less random, and more predictable, than it was. The astonishing success of Google was a black swan; so was 9/11. For Nassim Nicholas Taleb, black swans underlie almost everything about our world, from the rise of religions to events in our own personal lives.

Why do we not acknowledge the phenomenon of black swans until after they occur? Part of the answer, according to Taleb, is that humans are hardwired to learn specifics when they should be focused on generalities. We concentrate on things we already know and time and time again fail to take into consideration what we don’t know. We are, therefore, unable to truly estimate opportunities, too vulnerable to the impulse to simplify, narrate, and categorize, and not open enough to rewarding those who can imagine the “impossible.”

For years, Taleb has studied how we fool ourselves into thinking we know more than we actually do. We restrict our thinking to the irrelevant and inconsequential, while large events continue to surprise us and shape our world. Now, in this revelatory book, Taleb explains everything we know about what we don’t know. He offers surprisingly simple tricks for dealing with black swans and benefiting from them.

Elegant, startling, and universal in its applications The Black Swan will change the way you look at the world. Taleb is a vastly entertaining writer, with wit, irreverence, and unusual stories to tell. He has a polymathic command of subjects ranging from cognitive science to business to probability theory. The Black Swan is a landmark book–itself a black swan.

Amazon.com Review:
Bestselling author Nassim Nicholas Taleb continues his exploration of randomness in his fascinating new book, The Black Swan, in which he examines the influence of highly improbable and unpredictable events that have massive impact. Engaging and enlightening, The Black Swan is a book that may change the way you think about the world, a book that Chris Anderson calls, "a delightful romp through history, economics, and the frailties of human nature." See Anderson's entire guest review below.

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Guest Reviewer: Chris Anderson

Chris Anderson is editor-in-chief of Wired magazine and the author of The Long Tail: Why the Future of Business Is Selling Less of More.

Four hundred years ago, Francis Bacon warned that our minds are wired to deceive us. "Beware the fallacies into which undisciplined thinkers most easily fall--they are the real distorting prisms of human nature." Chief among them: "Assuming more order than exists in chaotic nature." Now consider the typical stock market report: "Today investors bid shares down out of concern over Iranian oil production." Sigh. We're still doing it.

Our brains are wired for narrative, not statistical uncertainty. And so we tell ourselves simple stories to explain complex thing we don't--and, most importantly, can't--know. The truth is that we have no idea why stock markets go up or down on any given day, and whatever reason we give is sure to be grossly simplified, if not flat out wrong.

Nassim Nicholas Taleb first made this argument in Fooled by Randomness, an engaging look at the history and reasons for our predilection for self-deception when it comes to statistics. Now, in The Black Swan: the Impact of the Highly Improbable, he focuses on that most dismal of sciences, predicting the future. Forecasting is not just at the heart of Wall Street, but it’s something each of us does every time we make an insurance payment or strap on a seat belt.

The problem, Nassim explains, is that we place too much weight on the odds that past events will repeat (diligently trying to follow the path of the "millionaire next door," when unrepeatable chance is a better explanation). Instead, the really important events are rare and unpredictable. He calls them Black Swans, which is a reference to a 17th century philosophical thought experiment. In Europe all anyone had ever seen were white swans; indeed, "all swans are white" had long been used as the standard example of a scientific truth. So what was the chance of seeing a black one? Impossible to calculate, or at least they were until 1697, when explorers found Cygnus atratus in Australia.

Nassim argues that most of the really big events in our world are rare and unpredictable, and thus trying to extract generalizable stories to explain them may be emotionally satisfying, but it's practically useless. September 11th is one such example, and stock market crashes are another. Or, as he puts it, "History does not crawl, it jumps." Our assumptions grow out of the bell-curve predictability of what he calls "Mediocristan," while our world is really shaped by the wild powerlaw swings of "Extremistan."

In full disclosure, I'm a long admirer of Taleb's work and a few of my comments on drafts found their way into the book. I, too, look at the world through the powerlaw lens, and I too find that it reveals how many of our assumptions are wrong. But Taleb takes this to a new level with a delightful romp through history, economics, and the frailties of human nature. --Chris Anderson

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Rating: - Black Swans and Systemic Risk?
In my opinion, of all the characteristics that define economic activity, connection is the most important. Institutions considered "too big to fail" are in reality "too connected to fail." The web of interdependencies that girdles the globe, linking the boardrooms of Wall Street to the kitchen tables of Main Street, can be the economic system's greatest vulnerability - as Nassim Taleb argues in The Black Swan - or its greatest strength. Job No. 1 for leaders of the world's financial institutions ... Read More

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Rating: - The Black Swan - A must read for compliance and risk professionals
The title of the book comes from the observations of Europeans that all swans are white. Much to their surprise, they came to Australia and found their first black swan. The book starts with this story to illustrate the "limitations to our learning from observations or experience and the fragility of our knowledge." As Taleb points out, it very different to think there is evidence of no possible black swans, than there is no evidence of the possibility of black swans.

Taleb has received ... Read More

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Rating: - Opportunities and threats in improbable events
I loved Nassim Nicholas Taleb's earlier book Fooled by Randomness, and I am really loving the Black Swan as well. It has much of the charm of Malcolm Gladwell's current NYT best seller, Outliers. -- But while Gladwell leaves us with merely the understanding that the success of various prominent individuals such as Bill Gates or Steve Jobs is due largely to the "luck" of being born in the right place and at the right time, he gives us no greater insight into how a better understanding of luck (in the ... Read More

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Rating: - Not for stock pickers; humanism is a religion
It's nice the book is not a sales pitch for his favorite fund. Around 16% of the pages in the book touch the topic of investing, trading, or markets. I consider pages 43, 73, 97, 124, 205-207, 223 to be the most useful. I'm not sure how to profit from rare events if the events are rare. As a paid critic, the author has improved his craft. He is critical of others on pages 105-106, 133, 148, 150, 151, 154-155, 164, 165-166.

The author is a humanist (p272). Around 14% of the pages of ... Read More

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Rating: - Throw away the bell curve.
THE BLACK SWAN makes a single salient point: the future is largely shaped by the unexpected and unpredictable. And that thought, as simple as it is, is profound.

For many years, swans were, by definition, white. But that paradigm was shattered when a black swan, a highly improbable event, was discovered in Australia. The black swan is Taleb's proxy for the unexpected.

In America, for example, the events which have shaped our lives; the Great Depression, WWII, the JFK assassination, ... Read More

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