Black Swans or Just Wishful Thinking and Misinterpretation?
There seem to be a lot of sightings of “Black Swans” lately. Should we be concerned or are we wishfully thinking, caught up in media hype; or are we misinterpreting what a “Black Swan” event really is?
The term “Black Swan” has become a popular buzzword for many; including, contingency planners, risk managers and consultants. However, are there really that many occurrences that qualify to meet the requirement of being termed a “Black Swan” or are we just caught up in the popularity of the moment?
The definition of a Black Swan according to Nassim Taleb, author of the book “The Black Swan: The Impact of the Highly Improbable” is:
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.
In a crisis you get one chance – your first and last. Being lucky does not mean that you are good. You may manage threats for a while. However, luck runs out eventually and panic, chaos, confusion set in eventually leading to collapse.
See Black Swans or Just Wishful Thinking and Misinterpretation? by Geary W. Sikich for Disaster Resource Guide.
Tags: Black Swan, Nassim Taleb
