Ever heard of the black swan theory?
At a meeting of the Board of Consumer Focus this week, I made a contribution which mentioned the black swan theory popularised by Nassim Nicholas Taleb in his 2007 book “The Black Swan”.
You can find a brief explanation of the black swan theory here and you can find an article on the concept in the context of financial markets here.
The article concludes:
“Currently, there are clear global risk factors: rising interest rates, the renewed threat of inflation, the slowing US economy, geopolitical instability. And yet global stock markets glide serenely higher. Clearly, investors believe that markets will ride out any short-term problems and believe they have factored in all the risks. But Black Swan thinking tells us to expect the unexpected.”
This article was published on 10 May 2007.