Started: [[2024-08-25]] Ended: Pages read per day: ## New words - erudition - the quality of having or showing great knowledge or learning; scholarship. - "he was known for his wit, erudition, and teaching skills" ## Notes ### Prologue The book is called “Black Swan” because before the discovery of Australia people in the Old World though swans were only ever white. --- A Black Swan has: - Rarity - Extreme impact - Retrospective predictability --- Ever since the Industrial Revolution, Black Swans have been increasing. --- Ask a portfolio manager for their definition of “risk” and few will consider Black Swans. --- Look at the large events and changes in your life. How many were planned? How many were scheduled? --- ### 1. The Apprenticeship of an Empirical Skeptic > “The New Testament was written in the bad local patrician Greek of our capital [Levantine], Antioch, prompting Nietzsche to shout that “God spoke bad Greek.”” P6 --- Your most effective as a nice guy and being “reasonable” if you can prove you’re will willing to go beyond just verbiage every now and then. You’ve got to show you can walk the walk. P7 --- For a thousand or so years Lebanon was very peaceful despite being made up of Christian’s, Muslims, and others. Then a Black Swan happened (WHEN?) and a fierce civil war broke out that put it all to an end. > “The number of cultured people dropped below some critical level. Suddenly the place became a vacuum. Brain drain is hard to reverse, and some of the old refinement may be lost forever.” p7 --- Christianity and Islam are Black Swans. > “Who predicted the rise of Christianity as a dominant religion in the Mediterranean basin, and later in the Western world? The Roman chroniclers of that period did not even take note of the new religion—historians of Christianity are baffled by the absence of contemporary mentions. Apparently, few of the big guns took the ideas of a seemingly heretical Jew seriously enough to think that he would leave traces for posterity. We only have a single contemporary reference to Jesus of Nazareth-in The Jewish Wars of Josephus-which itself may have been added later by a devout copyist. How about the competing religion that emerged seven centuries later; who forecast that a collection of horsemen would spread their empire and Islamic law from the Indian subcontinent to Spain in just a few years? Even more than the rise of Christianity, it was the spread of Islam (the third edition, so to speak) that carried full unpredictability; many historians looking at the record have been taken aback by the swiftness of the change. Georges Duby, for one, expressed his amazement about how quickly close to ten centuries of Levantine Hellenism were blotted out "with a strike of a sword."” p11 --- > “History and societies do not crawl. They make jumps. They go from fracture to fracture, with a few vibrations in between. Yet we (and histo-rians) like to believe in the predictable, small incremental progression. > > “It struck me, a belief that has never left me since, that we are just a great machine for looking backward, and that humans are great at self-delusion. Every year that goes by increases my belief in this distortion.” P11-12 --- The historian Niall Ferguson used the price of imperial bonds to show that there wasn’t “mounting tensions” and “escalating crises” in the lead-up to WW1, as the price remained stable. P14 --- > If you want to see what I mean by the arbitrariness of categories, check the situation of polarized politics. The next time a Martian visits earth, try to explain to him why those who favor allowing the elimination of a fetus in the mother's womb also oppose capital punishment. Or try to explain to him why those who accept abortion are supposed to be favorable to high taxation but against a strong military. Why do those who prefer sexual freedom need to be against individual economic liberty? > The best way to prove the arbitrary character of these categories, and the contagion effect they produce, is to remember how frequently these clusters reverse in history. Today's alliance between Christian fundamentalists and the Israeli lobby would certainly seem puzzling to a nineteenth-century intellectual-Christians used to be anti-Semites and Moslems were the protectors of the Jews, whom they preferred to Christians. Libertarians used to be left-wing. What is interesting to me as a probabilist is that some random event makes one group that initially supports an issue ally itself with another group that supports another issue, thus causing the two items to fuse and unify ... until the surprise of the separation. P16 --- > Note that I was not able to build a career just by betting on Black Swans— there were not enough tradable opportunities. I could, on the other hand, avoid being exposed to them by protecting my portfolio against large losses. So, in order to eliminate the dependence on randomness, I focused on technical inefficiencies between complicated instruments, and on exploiting these opportunities without exposure to the rare event, before they disappeared as my competitors became technologically advanced. Later on in my career I discovered the easier (and less randomness laden) business of protecting, insurance-style, large portfolios against the Black Swan. p20 --- ### 3. The Speculator and the Prostitute ‘Scalable’ jobs are unfair, rightly or wrongly. As the few within a profession have much more then the many. In past, an actor or singer would have to perform in person. So there was loads of them. Every village had a performer, or a travelling one. This supported lots of people. But the moment you can record pictures and music power concentrates. The ‘best’ dominate. There’s big earnings disparity. With one early earning millions, and the other pennies. Taleb using the example of him wanting to listen to classical music. He just plays a CD of a long-dead performer, rather than playing a local low budget pianist to perform. P26-31 ---