by Pater Tenebrarum, Acting-Man.com:
Nothing Can Go Wrong
In an interesting twist, investors have recently lost interest in betting on so-called ‘black swans’, the term coined by Nassim Taleb to describe unexpected events that prove the market consensus wrong. Although Taleb’s definition seems to imply that the ‘swan’ should be completely unexpected, it is our impression that in practice, it describes any development that upsets the consensus view.
For instance, in terms of the strict definition, the housing crisis was not a ‘black swan’. A number of people predicted it, and it was actually not at all difficult to predict it, even if most mainstream economists failed to do so. However, the crisis can perhaps be said to have contained a few events that for most people did meet the ‘black swan’ definition, such as for instance the bankruptcy of the GSEs or that of a few brokers such as Lehman, that had after all even survived the Great Depression.
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