What we call here a Black Swan (and capitalize it) is an event with the following three attributes. First, it is an outlier, as it lies outside the realm of regular expectations, because nothing in the past can convincingly point to its possibility. Second, it carries an extreme impact (unlike the bird). Third, in spite of its outlier status, human nature makes us concoct explanations for its occurrence after the fact, making it explainable and predictable. (Location 369)
the point of the thought experiment). The legislation (Location 471)
Platonicity is what makes us think that we understand more than we actually do. But this does not happen everywhere. I am not saying that Platonic forms don’t exist. Models and constructions, these intellectual maps of reality, are not always wrong; they are wrong only in some specific applications. The difficulty is that a) you do not know beforehand (only after the fact) where the map will be wrong, and b) the mistakes can lead to severe consequences. These models are like potentially helpful medicines that carry random but very severe side effects. (Location 515)
Indeed, the more you know, the larger the rows of unread books. Let us call this collection of unread books an antilibrary. (Location 611)
not afford to back down, or even blink. Had I concealed (Location 690)
The first leg of the triplet is the pathology of thinking that the world in which we live is more understandable, more explainable, and therefore more predictable than it actually (Location 733)
These kinds of discontinuities in the chronology of events did not make the historian’s profession too easy: the studious examination of the past in the greatest of detail does not teach you much about the mind of History; it only gives you the illusion of understanding it. History and societies do not crawl. They make jumps. They go from fracture to fracture, with a few vibrations in between. Yet we (and historians) like to believe in the predictable, small incremental progression. (Location 787)
manner by the crash, about this feeling of vindication. (Location 949)
and hold that “readers despise writers who pander (Location 1035)
Similarly, a writer expends the same effort to attract one single reader as she would to capture several hundred million. J. K. Rowling, the author of the Harry Potter books, does not have to write each book again every time someone wants to read it. But this is not so for a baker: he needs to bake every single piece of bread in order to satisfy each additional customer. (Location 1088)
So the distinction between writer and baker, speculator and doctor, fraudster and prostitute, is a helpful way to look at the world of activities. It separates those professions in which one can add zeroes of income with no greater labor from those in which one needs to add labor and time (both of which are in limited supply)—in other words, those subjected to gravity. (Location 1091)
them—death is often a good career move for an author. This implies that those who, for some reason, start getting some attention can quickly reach more minds than others and displace the competitors from the bookshelves. In the days of bards and troubadours, everyone had an audience. A storyteller, like a baker or a coppersmith, had a market, and the assurance that none from far away could dislodge him from his territory. Today, a few take almost everything; the rest, next to nothing. (Location 1129)
I can state the supreme law of Mediocristan as follows: When your sample is large, no single instance will significantly change the aggregate or the total. The largest observation will remain impressive, but eventually insignificant, to the sum. (Location 1171)
Look at how much you consume per year—if you are classified as human, close to eight hundred thousand calories. No single day, not even Thanksgiving at your great-aunt’s, will represent a large share of that. Even if you tried to kill yourself by eating, that day’s calories would not seriously affect your yearly consumption. (Location 1174)
Consider by comparison the net worth of the thousand people you lined up in the stadium. Add to them the wealthiest person to be found on the planet—say, Bill Gates, the founder of Microsoft. Assume his net worth to be close to $80 billion—with the total capital of the others around a few million. How much of the total wealth would he represent? 99.9 percent? Indeed, all the others would represent no more than a rounding error for his net worth, the variation of his personal portfolio over the past second. For someone’s weight to represent such a share, he would need to weigh fifty million pounds! (Location 1181)
Another way to say it is that social quantities are informational, not physical: you cannot touch them. Money in a bank account is something important, but certainly not physical. (Location 1193)
Look at the implication for the Black Swan. Extremistan can produce Black Swans, and does, since a few occurrences have had huge influences on history. This is the main idea of this book. (Location 1198)
If you are dealing with quantities from Extremistan, you will have trouble figuring out the average from any sample since it can depend so much on one single observation. The idea is not more difficult than that. In Extremistan, one unit can easily affect the total in a disproportionate way. In this world, you should always be suspicious of the knowledge you derive from data. This is a very simple test of uncertainty that allows you to distinguish between the two kinds of randomness. Capish? (Location 1208)
If we follow my distinction of scalable versus nonscalable, we can see clear differences shaping up between Mediocristan and Extremistan. Here are a few examples. Matters that seem to belong to Mediocristan (subjected to what we call type 1 randomness): height, weight, calorie consumption, income for a baker, a small restaurant owner, a prostitute, or an orthodontist; gambling profits (in the very special case, assuming the person goes to a casino and maintains a constant betting size), car accidents, mortality rates, “IQ” (as measured). Matters that seem to belong to Extremistan (subjected to what we call type 2 randomness): wealth, income, book sales per author, book citations per author, name recognition as a “celebrity,” number of references on Google, populations of cities, uses of words in a vocabulary, numbers of speakers per language, damage caused by earthquakes, deaths in war, deaths from terrorist incidents, sizes of planets, sizes of companies, (Location 1215)
Black Swan Is Relative to Knowledge (Location 1383)
From the standpoint of the turkey, the nonfeeding of the one thousand and first day is a Black Swan. For the butcher, it is not, since its occurrence is not unexpected. So you can see here that the Black Swan is a sucker’s problem. In other words, it occurs relative to your expectation. You realize that you can eliminate a Black Swan by science (if you’re able), or by keeping an open mind. (Location 1384)
In general, positive Black Swans take time to show their effect while negative ones happen very quickly—it is much easier and much faster to destroy than to build. (During the (Location 1395)
obligated to help their enemies. Hume looked unprepossessing. (Location 1405)
While the ancient skeptics advocated learned ignorance as the first step in honest inquiries toward truth, later medieval skeptics, both Moslems and Christians, used skepticism as a tool to avoid accepting what today we call science. (Location 1451)
Moslems and Christians, used skepticism as a tool (Location 1452)
manager, or the philistinism of the overspecialized scholar. (Location 1468)
Let us call it the domain specificity of our reactions. By domain-specific I mean that our reactions, our mode of thinking, our intuitions, depend on the context in which the matter is presented, what evolutionary psychologists call the “domain” of the object or the event. The classroom is a domain; real life is another. We react to a piece of information not on its logical merit, but on the basis of which framework surrounds it, and how it registers with our social-emotional system. Logical problems approached one way in the classroom might be treated differently in daily life. Indeed they are treated differently in daily life. (Location 1558)
An acronym used in the medical literature is NED, which stands for No Evidence of Disease. There is no such thing as END, Evidence of No Disease. Yet my experience discussing this matter with plenty of doctors, even those who publish papers on their results, is that many slip into the round-trip fallacy during conversation. (Location 1586)
There is an exception, however: I know what statement is wrong, but not necessarily what statement is correct. If I see a black swan I can certify that all swans are not white! If I see someone kill, then I can be practically certain that he is a criminal. If I don’t see him kill, I cannot be certain that he is innocent. (Location 1618)
We can get closer to the truth by negative instances, not by verification! It is misleading to build a general rule from observed facts. (Location 1622)
But it remains the case that you know what is wrong with a lot more confidence than you know what is right. (Location 1648)
Cognitive scientists have studied our natural tendency to look only for corroboration; they call this vulnerability to the corroboration error the confirmation bias. There are some experiments showing that people focus only on the books read in Umberto Eco’s library. You can test a given rule either directly, by looking at instances where it works, or indirectly, by focusing on where it does not work. As we saw earlier, disconfirming instances are far more powerful in establishing truth. Yet we tend to not be aware of this property. (Location 1654)
The following point further illustrates the absurdity of confirmation. If you believe that witnessing an additional white swan will bring confirmation that there are no black swans, then you should also accept the statement, on purely logical grounds, that the sighting of a red Mini Cooper should confirm that there are no black swans. Why? Just consider that the statement “all swans are white” is equivalent to “all nonwhite objects are not swans.” (Location 1681)
novel, a story, a myth, or a tale, all have the same function: they spare us from the complexity of the world and shield us from its randomness. Myths impart order to the disorder of human perception and the perceived “chaos of human experience.” (Location 1878)
Narrativity can viciously affect the remembrance of past events as follows: we will tend to more easily remember those facts from our past that fit a narrative, while we tend to neglect others that do not appear to play a causal role in that narrative. (Location 1899)
Memory is more of a self-serving dynamic revision machine: you remember the last time you remembered the event and, without realizing it, change (Location 1907)
sat down and listened very calmly to the evaluation (Location 2446)
The neglect of silent evidence is endemic to the way we study comparative talent, particularly in activities that are plagued with winner-take-all attributes. We may enjoy what we see, but there is no point reading too much into success stories because we do not see the full picture. (Location 2507)
Notice that close to two centuries ago people had an idealized opinion of their own past, just as we have an idealized opinion of today’s past. (Location 2547)
stop? The answer is no. The same optical illusion prevails: those who start gambling will be either lucky or unlucky (given that the casino has the advantage, a slightly greater number will be unlucky). The lucky ones, with the feeling of having been selected by destiny, will continue gambling; the others, discouraged, will stop and will not show up in the sample. They will probably take up, depending on their temperaments, bird-watching, Scrabble, piracy, or other pastimes. Those who continue gambling will remember having been lucky as beginners. The dropouts, by definition, will no longer be part of the surviving gamblers’ community. This explains beginner’s luck. (Location 2631)
The bias lowers our perception of the risks we incurred in the past, particularly for those of us who were lucky to have survived them. Your life came under a serious threat but, having survived it, you retrospectively underestimate how risky the situation actually was. (Location 2694)
worry since he always came back with a vengeance. (Location 2715)
typhoid fever. Had it not been for the discovery of antibiotics, (Location 2797)
What is the ludic fallacy? Ludic comes from ludus, Latin for games. (Location 2960)
In real life you do not know the odds; you need to discover them, and the sources of uncertainty are not defined. (Location 2969)
maimed by a tiger (the show, Siegfried and Roy, had (Location 3010)
Alas, we are not manufactured, in our current edition of the human race, to understand abstract matters—we need context. Randomness and uncertainty are abstractions. We respect what has happened, ignoring what could have happened. In other words, we are naturally shallow and superficial—and we do not know it. (Location 3053)
Epistemic arrogance bears a double effect: we overestimate what we know, and underestimate uncertainty, by compressing the range of possible uncertain states (i.e., by reducing the space of the unknown). (Location 3187)
The more information you give someone, the more hypotheses they will formulate along the way, and the worse off they will be. They see more random noise and mistake it for information. (Location 3256)
The problem is that our ideas are sticky: once we produce a theory, we are not likely to change our minds—so those who delay developing their theories are better off. When you develop your opinions on the basis of weak evidence, you will have difficulty interpreting subsequent (Location 3257)
Simply, things that move, and therefore require knowledge, do not usually have experts, while things that don’t move seem to have some experts. (Location 3310)
Similarly, ask someone to provide you with the last four digits of his social security number. Then ask him to estimate the number of dentists in Manhattan. You will find that by making him aware of the four-digit number, you elicit an estimate that is correlated with it. (Location 3542)
With scalable variables, the ones from Extremistan, you will witness the exact opposite effect. Let’s say a project is expected to terminate in 79 days, the same expectation in days as the newborn female has in years. On the 79th day, if the project is not finished, it will be expected to take another 25 days to complete. But on the 90th day, if the project is still not completed, it should have about 58 days to go. On the 100th, it should have 89 days to go. On the 119th, it should have an extra 149 days. On day 600, if the project is not done, you will be expected to need an extra 1,590 days. As you see, the longer you wait, the longer you will be expected to wait. (Location 3558)
eradicated—even after they cleaned the bird excrement (Location 3711)
to understand the future to the point of being able to predict it, you need to incorporate elements from this future itself. If you know about the discovery you are about to make in the future, then you have almost made it. (Location 3791)
Some might say that the argument, as phrased, seems obvious, that we always think that we have reached definitive knowledge but don’t notice that those past societies we laugh at also thought the same way. (Location 3818)
I will repeat that Poincaré was the true kind of philosopher of science: his philosophizing came from his witnessing the limits of the subject itself, which is what true philosophy is all about. (Location 3839)
Simply, people need to be blinded by knowledge—we are made to follow leaders who can gather people together because the advantages of being in groups trump the disadvantages of being alone. It has been more profitable for us to bind together in the wrong direction than to be alone in the right one. (Location 4161)
The only way you can imagine a future “similar” to the past is by assuming that it will be an exact projection of it, hence predictable. Just as you know with some precision when you were born, you would then know with equal precision when you will die. (Location 4177)
This idea is often erroneously called Pascal’s wager, after the philosopher and (thinking) mathematician Blaise Pascal. He presented it something like this: I do not know whether God exists, but I know that I have nothing to gain from being an atheist if he does not exist, whereas I have plenty to lose if he does. Hence, this justifies my belief in God. (Location 4476)
Missing a train is only painful if you run after it! Likewise, not matching the idea of success others expect from you is only painful if that’s what you are seeking. You stand above the rat race and the pecking order, not outside of it, if you do so by choice. (Location 6006)
You have far more control over your life if you decide on your criterion by yourself. (Location 6010)
It is more difficult to be a loser in a game you set up yourself. In Black Swan terms, this means that you are exposed to the improbable only if you let it control you. You always control what you do; so make this your end. (Location 6014)
Don’t be like the ingrate who got a castle as a present and worried about the mildew in the bathroom. Stop looking the gift horse in the mouth—remember that you are a Black Swan. And (Location 6024)
Like parties, a book puts you on the envelope of serendipity; (Location 6145)
bird. Of course, you will not be aware of the truncation—and (Location 6930)