“The Black Swan: The Impact of the Highly Improbable” is the second successful book of Nassim Nicholas Taleb, after “Fooled by Randomness: The Hidden Role of Chance in the Markets and Life”.
A black swan is an event with three main characteristics:
- It is an outlier, as it lies outside the realm of regular expectations, because nothing in the past can convincingly point to its possibility
- it carries an extreme impact
- In spite of its outlier status, human nature makes us concoct explanations for its occurrence after the fact
examples are the rise of Hitler, the precipitous demise of the Soviet bloc, and more recently the market crash, the latest news of the fall of Lehman Brother and Merrill Lynch.
A book worth to read.