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The Black Swan Summary

About The Black Swan Book

The Black Swan is a standalone book in Nassim Nicholas Talebā€™s landmark Incerto series, an investigation of opacity, luck, uncertainty, probability, human error, risk, and decision-making in a world we donā€™t understand. The other books in the series are Fooled by Randomness, Antifragile, and The Bed of Procrustes.

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.
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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 donā€™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 ā€œimpossible.ā€
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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. In this revelatory book, Taleb explains everything we know about what we donā€™t know, and this second edition features a new philosophical and empirical essay, ā€œOn Robustness and Fragility,ā€ which offers tools to navigate and exploit a Black Swan world.
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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 bookā€”itself a black swan.
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Praise for Nassim Nicholas Taleb
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ā€œThe most prophetic voice of all.ā€ā€”GQ
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Praise for The Black Swan
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ā€œ[A book] that altered modern thinking.ā€ā€”The Times (London)
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ā€œA masterpiece.ā€ā€”Chris Anderson, editor in chief of Wired, author of The Long Tail
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ā€œIdiosyncratically brilliant.ā€ā€”Niall Ferguson, Los Angeles Times
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ā€œThe Black Swan changed my view of how the world works.ā€ā€”Daniel Kahneman, Nobel laureate
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ā€œ[Taleb writes] in a style that owes as much to Stephen Colbert as it does to Michel de Montaigne. . . . We eagerly romp with him through the follies of confirmation bias [and] narrative fallacy.ā€ā€”The Wall Street Journal
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ā€œHugely enjoyableā€”compelling . . . easy to dip into.ā€ā€”Financial Times
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ā€œEngaging . . . The Black Swan has appealing cheek and admirable ambition.ā€ā€”The New York Times Book Review


From the Hardcover edition.

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The Black Swan by Nassim Nicholas Taleb

Overview

Black Swans are not inconsequential anomalies, but a significant phenomenon that shapes the very world we live in. Many historical events that drastically impacted our socities and lives were actually Black Swan events. These incluse the 2 world wars, the fall of the Berlin Wall, the 11 Sep 2001 terrorist attacks, the rise of the Internet or the 2019-2020 Covid pandemic.Ā 

In all these cases, no one could've predicted the events in advance.

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What are Black Swans and why are they important

For thousands of years, it was widely believed that all swans were white. Then in 1697, a Dutch explorer Willem de Vlamingh discovered black swans in Australia, debunking this universal ā€œtruthā€ overnight. The term ā€œBlack Swanā€ has since been used to describe the occurrence of a seemingly-impossible event.

215

Three lessons:

Taleb identifies 3 key features of Black Swans:
ā€¢ Rarity: Black Swans are outliers that canā€™t be reasonably expected to happen based on past events.
ā€¢ They have a profound impact on our society/world.
ā€¢ Retrospective predictability: Although the events are unpredictable, humans tend to explain them on hindsight as if they could be perfectly understood and predicted.

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Discover how unpredictable, game-changing events shape our world and how we can thrive amidst uncertainty in Nassim Nicholas Talebā€™s ā€œBlack Swan.ā€

The Concept of Black Swan

The Concept of Black Swan

Black Swan events are rare, have a significant impact, and are retrospectively predictable.

Taleb uses the metaphor of discovering black swans in Australia to illustrate that just because something has never been seen before, it doesnā€™t mean it canā€™t exist.

He argues that these events are beyond the realm of regular expectations and significantly shape the world. Examples include the rise of the internet and the 9/11 attacks.

The term emphasizes the limits of our learning from past experiences, as we often canā€™t foresee these game-changing occurrences

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The Limits of Knowledge

The Limits of Knowledge

Taleb argues that we overestimate what we know and underestimate the unknown.

This human tendency to think we know more than we do makes us vulnerable to unexpected events.

He introduces the concept of epistemic arrogance, which is our inflated belief in our understanding of the world.

Taleb asserts that our knowledge is often fragile and based on incomplete information, leading us to be blindsided by events we never saw coming.

He emphasizes the need to remain humble and aware of our limitations.

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Mediocristan Vs Extremistan

Mediocristan Vs Extremistan

The book introduces the concepts of Mediocristan and Extremistan.

In Mediocristan, events are normally distributed, and extremes donā€™t have much impact.

For instance, human heights follow this distribution, with most people falling within a certain range.

In Extremistan, a few extreme events dominate, and these are the realms where Black Swans reside.

Examples include wealth distribution and book sales, where a small number of outliers have a disproportionate effect.

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The uncertainties to the world events can b me unpredictable.

Overview

Black swans are not inconsequential anomalies, but a significant phenomenon that shapes the very world we live in. Many historical events that drastically impacted our societies and lives were actually Black Swan events. These include the 2 world wars, the fall of the Berlin Wall, the 11th September 2001 terrorist attacks, the rise of the internet or the 2019 - 2020 Covid pandemic.

In all these cases, no one couldā€™ve predicted the events in advance

18

What Are Black Swans And Why Are They Imp

For thousands of years, it was widely believed that all swans were white. Then in 1697, a Dutch explorer Willem de Vlamingh discovered black swans in Australia, debunking this universal ā€œtruthā€ overnight. The term ā€œBlack Swanā€ has since been used to describe the occurrence of a seemingly impossible event

20

Three Lessons:

Taleb identifies 3 key features of Black Swans:

  • Rarity: Black Swans are outliers that canā€™t be reasonably expected to happen based on based past events.
  • They have a profound impact on our society/world.
  • Retrospective predictability: Although the events are unpredictable, humans tend to explain then on hindsight as if they could be perfectly understood and predicted.

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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.

NASSIM NICHOLAS TALEB

Do not try to predict precise Black Swans - it tends to make you more vulnerable to the ones you did not predict [ā€¦]

Invest in preparedness, not in prediction. Remember that infinite vigilance is just not possible.

NASSIM NICHOLAS TALEB

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VENU KUMAR

Look for the unpredictable event that will shape your future

VENU KUMAR

5

<p>Thomas Alva Edison is not o...

Thomas Alva Edison is not only famous for his invention of the electric bulb, he is also famous for his perseverance in waiting for the right element to use inside the bulb. The expectation for the successful event and constant trial in that process lit the bulb that we are using now.

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The strategy for the discoverers and entrepreneurs is to rely less on top-down planning and focus on maximum tinkering and recognizing opportunities when they present themselves.

NASSIM THALEB

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Planning and Opportunities

The occurring of Black Swan in our lives makes planning sometimes obsolete, Thaleb on his book suggests that contrary to top down planning of everything, an entrepreneur or discoverers should take actions whenever the opportunity comes

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Ludička zabluda ili Ŕtreberska neizvjesnost

Znanje stečeno u učionici često posjeduje nekakvu sterilnu, mračnu kvalitetu koja sprječava razumijevanje zbivanja u stvarnom svijetu. Na testu inteligencije, kao i u bilo kom akademskom okruženju (uključujući i sport), doktor Džon bi umnogome nadmaÅ”io debelog Tonija. Ali debeli Toni nadmaÅ”io bi doktora Džona u svakoj drugoj mogućoj ekoloÅ”ki stvarnoj situaciji.

Doktor Džon - Tipični primjer ličnosti kojoj je cijeli svijet zasnovan na matematičkom modelu, preciznosti i pedantnosti. Posao i obaveze shvata kranje ozbiljno.

Debeli Toni - Tipični primjer ličnosti koji je veoma daleko od Å”trebera. UspjeÅ”an je, vedre naravi, druželjubiv. Ima zapanjujuću naviku da novac zarađuje bez napora, iz zabave, bez natezanja.

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Klasifikovanje Crnog labuda

Četiri kriterijuma za klasifikovanje događaja kao dogadaja crnog labuda.

Veoma je teÅ”ko odlučiti da li bi rijedak događaj trebalo da bude klasifikovan kao dogadaj crnog labuda ili ne.

Generalno, da bi dogadaj bio klasifikovan kao crni labud, trebalo bi da ispunjava četiri kriterijuma.

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2. Blokbaster - Crni labud

Događaj bi trebalo da bude blokbaster - ogroman, kao Å”to je epidemija Å”panske gripe.

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Predictions and Planning in an increasing Entropic world

Nothing Is 100% Cert

Black Swans are not inconsequential anomalies, but a significant phenomenon that shapes the very world we live in. Many historical events that drastically impacted our socities and lives were actually Black Swan events. These incluse the 2 world wars, the fall of the Berlin Wall, the 11 Sep 2001 terrorist attacks, the rise of the Internet or the 2019-2020 Covid pandemic.

In all these cases, no one could've predicted the events in advance.

1

Don't use your past to explain the future.

Based on the only things we can be certain of - what has happened in our lives in the past - we weave a narrative that makes sense and expect that the future simply must unfold this way. For example, imagine you're a turkey and for years you live on a farm, get to roam free every day and are fed great food by a farmer. Why would you expect anything to change? But if tomorrow's Thanksgiving, you're just 24 hours away from getting killed, stuffed and roasted.

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