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Black swans

In the new words department:

The disaster bureaucrats talk about black swans: calamities from out of the blue, terrible and strange. The world is now transfixed by the black swan disaster of Japan — an earthquake larger than seismologists thought could happen in that part of the country, leading to a tsunami too big for the sea walls, and now a nuclear crisis that wasn’t supposed to be possible.

via Japan’s ‘black swan’: Scientists ponder the unparalleled dangers of unlikely disasters – The Washington Post.

I like new terms that are not mere abstractions but vivid images.  “Black swan” gives us a picture of something that is very unlikely, but that occasionally, creepily, happens.  (It turns out, though, that there is a whole species of black swans in Australia that wasn’t discovered until the 18th century.)

See this for “black swan events”

Karl Popper uses the example of a black swan to show how, contrary to naive scientism, you can’t jump from the observation of particulars to make universal conclusions, but how particulars are useful to meet the criterion of falsifiability.

Then there is the ballet movie Black Swan, which plays off of some imagery in Tschaikovsky’s Swan Lake , but that’s different, positing in the white swan and the black swan a contrast between purity and sensuality.

Now that we apparently have a new word, what are some other rare, unexpected, and weird calamities that would qualify as black swans?

About Gene Veith

Professor of Literature at Patrick Henry College, the Director of the Cranach Institute at Concordia Theological Seminary, a columnist for World Magazine and TableTalk, and the author of 18 books on different facets of Christianity & Culture.

  • SKPeterson

    Well, if we take Japan as an example, Black Swans appear to have a lot to do with human error and sloppiness. While not a trait generally associated with the Japanese, it’s now come out that Tokyo Power was regularly engaging in highly questionable practices regarding the storage of the Fukushima reactor’s SNF rods, which led almost directly to the dire situation that developed after the quake and tsunami. so, shouldn’t have happened? No, but the problem wasn’t the quake per se, but poor practice. Reports are also coming out that records were available (albeit from ca 900, but available nonetheless) describing the last earthquake of about this magnitude in Japan and the resulting devastation and tsunami impacts on the area. A very rare event (once every 1000+ years), but maybe one you should account for when dealing with seawalls and nuclear power plants? So the seismologists were wrong – is that a black swan event? If I ignore or am unaware of relevant data and make predictions accordingly, should I be surprised when “unexpected” events occur? The black swan was the confluence of these events/practices, but it shouldn’t have been too surprising given the poor operating procedures of the Fukushima plant (if the stories on the practices are correct – see here: http://online.wsj.com/article/SB10001424052748704433904576212980463881792.html).

  • SKPeterson

    Well, if we take Japan as an example, Black Swans appear to have a lot to do with human error and sloppiness. While not a trait generally associated with the Japanese, it’s now come out that Tokyo Power was regularly engaging in highly questionable practices regarding the storage of the Fukushima reactor’s SNF rods, which led almost directly to the dire situation that developed after the quake and tsunami. so, shouldn’t have happened? No, but the problem wasn’t the quake per se, but poor practice. Reports are also coming out that records were available (albeit from ca 900, but available nonetheless) describing the last earthquake of about this magnitude in Japan and the resulting devastation and tsunami impacts on the area. A very rare event (once every 1000+ years), but maybe one you should account for when dealing with seawalls and nuclear power plants? So the seismologists were wrong – is that a black swan event? If I ignore or am unaware of relevant data and make predictions accordingly, should I be surprised when “unexpected” events occur? The black swan was the confluence of these events/practices, but it shouldn’t have been too surprising given the poor operating procedures of the Fukushima plant (if the stories on the practices are correct – see here: http://online.wsj.com/article/SB10001424052748704433904576212980463881792.html).

  • Dan Kempin

    SK, #1,

    “Well, if we take Japan as an example . . . The black swan was the confluence of these events/practices, but it shouldn’t have been too surprising given the poor operating procedures of the Fukushima plant.”

    And the criteria from the Wikipedia article to identify Black Swan events:

    “1.The event is a surprise (to the observer).
    2.The event has a major impact.
    3.After its first recording, the event is rationalized by hindsight, as if it could have been expected (e.g., the relevant data were available but not accounted for).”

    Wow. Were you trying to demonstrate point #3?

  • Dan Kempin

    SK, #1,

    “Well, if we take Japan as an example . . . The black swan was the confluence of these events/practices, but it shouldn’t have been too surprising given the poor operating procedures of the Fukushima plant.”

    And the criteria from the Wikipedia article to identify Black Swan events:

    “1.The event is a surprise (to the observer).
    2.The event has a major impact.
    3.After its first recording, the event is rationalized by hindsight, as if it could have been expected (e.g., the relevant data were available but not accounted for).”

    Wow. Were you trying to demonstrate point #3?

  • Porcell

    Jesus, arriving on scene in Jerusalem as the incarnate Lord to displace the Temple with the Cross, could be regarded as the ultimate Black Swan event.

    Another example, though rather crass, would be Long Term Capital Management, a hedge fund that had the benefit of sophisticated international financial market models developed by Nobelist economists, Robert Merton and Myron Scholes. Between 1994 and 1998 this fund was earning about 40% on its investments.

    Then suddenly Russia defaulted on its debt, sending emerging market bond and stock markets into a deep tailspin; LTCM, leveraged at about 25-1, lost 1.9 $billion on an overall arbitraged amount of more than 1 $trillion; eventually LTCM folded at a huge loss to its investors and was taken over in a government organized bailout.

    The LTCM financial models worked well until the Russian black swan arrived on scene.

  • Porcell

    Jesus, arriving on scene in Jerusalem as the incarnate Lord to displace the Temple with the Cross, could be regarded as the ultimate Black Swan event.

    Another example, though rather crass, would be Long Term Capital Management, a hedge fund that had the benefit of sophisticated international financial market models developed by Nobelist economists, Robert Merton and Myron Scholes. Between 1994 and 1998 this fund was earning about 40% on its investments.

    Then suddenly Russia defaulted on its debt, sending emerging market bond and stock markets into a deep tailspin; LTCM, leveraged at about 25-1, lost 1.9 $billion on an overall arbitraged amount of more than 1 $trillion; eventually LTCM folded at a huge loss to its investors and was taken over in a government organized bailout.

    The LTCM financial models worked well until the Russian black swan arrived on scene.

  • CRB

    The fall of our first parents in the Garden?

  • CRB

    The fall of our first parents in the Garden?

  • Tom Hering

    Wisconsin 2011. Ongoing and growing. Too soon for hindsight.

  • Tom Hering

    Wisconsin 2011. Ongoing and growing. Too soon for hindsight.

  • http://facebook.com/mesamike Mike Westfall

    I can think of one event in particular that happened in 2008, but because the word “black” is involved, I’m sure I’d be considered a racist. So, I’ll refrain from specifying what that event was.

  • http://facebook.com/mesamike Mike Westfall

    I can think of one event in particular that happened in 2008, but because the word “black” is involved, I’m sure I’d be considered a racist. So, I’ll refrain from specifying what that event was.

  • Tom Hering

    Mike @ 6, all I can conclude from your mysterious statement is that it was an event you’re not happy about, and the word “black” has something to do with it.

  • Tom Hering

    Mike @ 6, all I can conclude from your mysterious statement is that it was an event you’re not happy about, and the word “black” has something to do with it.

  • Porcell

    Tom, you’re right about Wisconsin 2011, an unlikely Republican governor in a formerly deep blue state takes on the public unions, defeats them, and solves the state’s budget crisis, much to the broad public’s delight. Definitely and happily a black swan event.

  • Porcell

    Tom, you’re right about Wisconsin 2011, an unlikely Republican governor in a formerly deep blue state takes on the public unions, defeats them, and solves the state’s budget crisis, much to the broad public’s delight. Definitely and happily a black swan event.

  • SKPeterson

    Dan – you hit it, and its one of my problems with “black swans” – they are events that CAN be accounted for but are far out on the tail of statistical probability. Then everybody freaks out and panics because of this supposedly unforeseeable event. I guess the issue is that because of the complex relationships between a sinful and imperfect humanity and an often unknowable natural world, many unexpected things occur, and that these occurrences happen regularly. However, the way the power plant was operating it could also be argued that a smaller quake event would have resulted in a similar incident at the plant which diminishes the black swan argument. My point boils down to “Act stupid long enough and Nature will take advantage.” Or something like that.

  • SKPeterson

    Dan – you hit it, and its one of my problems with “black swans” – they are events that CAN be accounted for but are far out on the tail of statistical probability. Then everybody freaks out and panics because of this supposedly unforeseeable event. I guess the issue is that because of the complex relationships between a sinful and imperfect humanity and an often unknowable natural world, many unexpected things occur, and that these occurrences happen regularly. However, the way the power plant was operating it could also be argued that a smaller quake event would have resulted in a similar incident at the plant which diminishes the black swan argument. My point boils down to “Act stupid long enough and Nature will take advantage.” Or something like that.

  • http://www.toddstadler.com/ tODD

    Seems to me that the usefulness of this idea is limited, because people can always argue to what extent we should have expected something that happened — after it happened, of course.

    There were warning signs before this reactor crisis. There were warning signs before 9/11. There were warning signs before Deepwater Horizon. And on and on.

    Obviously, in all of these cases, the relevant people ignored these warning signs, catching a whole lot of formerly irrelevant people by surprise with the ensuing impact.

    In my case, I live in Oregon. Ever since I have moved out here, I have heard warnings about an earthquake — “The Big One” — potentially happening any year now. I could not reasonably claim that this earthquake, when and if it happens, would be unexpected. And yet, until very recently, I never had anything like an earthquake preparedness kit assembled. Because I’ve lived here for over a decade and experienced relatively few earthquakes. It’s easy to forget. And it’s time-consuming and a bit spendy to buy all that stuff.

    I think that’s how most people approach such supposedly “Black Swan” events. Ignore the warnings that are there because it seems like a waste of time or money to do anything about it.

  • http://www.toddstadler.com/ tODD

    Seems to me that the usefulness of this idea is limited, because people can always argue to what extent we should have expected something that happened — after it happened, of course.

    There were warning signs before this reactor crisis. There were warning signs before 9/11. There were warning signs before Deepwater Horizon. And on and on.

    Obviously, in all of these cases, the relevant people ignored these warning signs, catching a whole lot of formerly irrelevant people by surprise with the ensuing impact.

    In my case, I live in Oregon. Ever since I have moved out here, I have heard warnings about an earthquake — “The Big One” — potentially happening any year now. I could not reasonably claim that this earthquake, when and if it happens, would be unexpected. And yet, until very recently, I never had anything like an earthquake preparedness kit assembled. Because I’ve lived here for over a decade and experienced relatively few earthquakes. It’s easy to forget. And it’s time-consuming and a bit spendy to buy all that stuff.

    I think that’s how most people approach such supposedly “Black Swan” events. Ignore the warnings that are there because it seems like a waste of time or money to do anything about it.

  • http://www.cyberbrethren.com Rev. Paul T. McCain

    Christians should have the most realistic view of “black swans” for our Lord has warned us, long ago:

    3As he sat on the Mount of Olives, the disciples came to him privately, saying, “Tell us, when will these things be, and what will be the sign of your coming and of the close of the age?” 4And Jesus answered them, “See that no one leads you astray. 5For many will come in my name, saying, ‘I am the Christ,’ and they will lead many astray. 6And you will hear of wars and rumors of wars. See that you are not alarmed, for this must take place, but the end is not yet. 7For nation will rise against nation, and kingdom against kingdom, and there will be famines and earthquakes in various places. 8All these are but the beginning of the birth pains.

    9″Then they will deliver you up to tribulation and put you to death, and you will be hated by all nations for my name’s sake. 10And then many will fall away and betray one another and hate one another. 11And many false prophets will arise and lead many astray. 12And because lawlessness will be increased, the love of many will grow cold. 13 But the one who endures to the end will be saved. 14And this gospel of the kingdom will be proclaimed throughout the whole world as a testimony to all nations, and then the end will come.

  • http://www.cyberbrethren.com Rev. Paul T. McCain

    Christians should have the most realistic view of “black swans” for our Lord has warned us, long ago:

    3As he sat on the Mount of Olives, the disciples came to him privately, saying, “Tell us, when will these things be, and what will be the sign of your coming and of the close of the age?” 4And Jesus answered them, “See that no one leads you astray. 5For many will come in my name, saying, ‘I am the Christ,’ and they will lead many astray. 6And you will hear of wars and rumors of wars. See that you are not alarmed, for this must take place, but the end is not yet. 7For nation will rise against nation, and kingdom against kingdom, and there will be famines and earthquakes in various places. 8All these are but the beginning of the birth pains.

    9″Then they will deliver you up to tribulation and put you to death, and you will be hated by all nations for my name’s sake. 10And then many will fall away and betray one another and hate one another. 11And many false prophets will arise and lead many astray. 12And because lawlessness will be increased, the love of many will grow cold. 13 But the one who endures to the end will be saved. 14And this gospel of the kingdom will be proclaimed throughout the whole world as a testimony to all nations, and then the end will come.

  • Porcell

    Actually, as Taleb points out, after a black swan event, from the benefit of hindsight, the event alway seems plausible, though in his book, Fooled By Randomnesshe remarks that it’s not all random, it’s just more random than people think.

    Taleb well understands many modern thinkers exaggerate the certainty of their knowledge. This is a result of the arrogance of modern rationalism and scientism that hasn’t in the slightest been changed by “post-modern” sophistry. This was undoubtedly the case of Merton and Scholes in the example cited at post three. The field of finance is strewn with the wreckage of over-confident analysts. Also, it is well known that one major cause of plane crashes is the faux certainty of pilots.

    Taleb’s book on randomness is a brilliant must read.

  • Porcell

    Actually, as Taleb points out, after a black swan event, from the benefit of hindsight, the event alway seems plausible, though in his book, Fooled By Randomnesshe remarks that it’s not all random, it’s just more random than people think.

    Taleb well understands many modern thinkers exaggerate the certainty of their knowledge. This is a result of the arrogance of modern rationalism and scientism that hasn’t in the slightest been changed by “post-modern” sophistry. This was undoubtedly the case of Merton and Scholes in the example cited at post three. The field of finance is strewn with the wreckage of over-confident analysts. Also, it is well known that one major cause of plane crashes is the faux certainty of pilots.

    Taleb’s book on randomness is a brilliant must read.

  • Tom Hering

    Porcell @ 8, I was referring to an event that took place on a planet called Earth. Just so you know. ;-)

  • Tom Hering

    Porcell @ 8, I was referring to an event that took place on a planet called Earth. Just so you know. ;-)

  • Porcell

    Tom, at 13, We shall see. Just now I would bet that Walker will best the public-employee unions. People in the country, including Wisconsin, have become well aware of the heavy-handed tactics of public employee unions that have led the country to unsustainable unfunded fiscal liabilities.

    I understand that you are on planet earth, though perhaps rather affected by an excess of moonshine.

  • Porcell

    Tom, at 13, We shall see. Just now I would bet that Walker will best the public-employee unions. People in the country, including Wisconsin, have become well aware of the heavy-handed tactics of public employee unions that have led the country to unsustainable unfunded fiscal liabilities.

    I understand that you are on planet earth, though perhaps rather affected by an excess of moonshine.

  • Louis

    Hey Tom, I could do with some of that moonshine Porcell references – it is snowing outside in this “winter without end”, and some internal heat could help :)

  • Louis

    Hey Tom, I could do with some of that moonshine Porcell references – it is snowing outside in this “winter without end”, and some internal heat could help :)

  • Tom Hering

    Hey Louis, Winter is hitting Wisconsin one last time too – the day after I saw my first Robin (Spring!). And better the moonshine than the Kool-Aid, eh? :-D

  • Tom Hering

    Hey Louis, Winter is hitting Wisconsin one last time too – the day after I saw my first Robin (Spring!). And better the moonshine than the Kool-Aid, eh? :-D

  • Louis

    Tom – absolutely. And no robins yet. The max temperature is still below freezing, after a brief peek above last week.

  • Louis

    Tom – absolutely. And no robins yet. The max temperature is still below freezing, after a brief peek above last week.


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