Fooled by Randomness

In his books, The Black Swan and Antifragile, Nassim Nicholas Taleb observes that freak disasters—rare, high-impact events—are unpredictable and often underestimated due to their low probability. He calls these “Black Swan” events, characterized by their extreme rarity, severe consequences, and retrospective predictability. Taleb argues that people and systems are overly reliant on normalcy and linear models, ignoring the potential for such outliers.

These disasters expose the fragility of complex systems, like financial markets or infrastructure, which are unprepared for extreme shocks. In Antifragile, he contrasts fragile systems with antifragile ones, which thrive under stress. Taleb emphasizes that freak disasters are not anomalies but inevitable in a complex world, urging risk management that accounts for uncertainty rather than predictability. He critiques overconfidence in forecasting and advocates for building resilience to mitigate the devastating effects of these unpredictable events.