The term “Black Swan” is commonly understood as the collective name of events, upon the occurrence of which there are quite significant consequences.
Such an event can be compared to finding a nugget that can bring thousands of percent per annum, and during the year there may be more than one or two of them, given the prompt reaction of the markets to economic indicators, statistical data, and the general news background. In the event that you react to a change in market conditions quickly enough, you can earn a fairly decent amount.
Almost at the same time, it was possible to play on the strengthening of the national currency of the Russian Federation against the dollar, earning 1514% on this, while those who bet in August 2011 on the growth of the dollar against the ruble received a profit of 2161%. The Black Swan strategy implies a sensitive response to the occurrence of conditions necessary for the emergence of a happy accident in the market, while luck favors those who are ready to capitalize on these events.
The concept of the “Black Swan” owes its appearance to the Lebanese-American writer Nassim Taleb, who used the term in the book of the same name in 2007 In the year no black swans were found in Australia, the whole world believed that in reality only white swans existed. So, the only observation crossed out the axiom, deduced for several millennia, when only white swans had to be admired.
According to Taleb’s criteria, a “Black Swan” can be called an unexpected event that has significant consequences, and human nature makes it necessary to come up with explanations after the completely unexpected event has taken place, presenting it as predictable and completely explainable. Based on the logic of the Black Swan, we can say that it makes what we do not know much more important than what we have an idea about. Many Black Swans just appeared in the world precisely because no one expected to see them. Let us dwell on several Black Swans that have had a special impact on the life of society.
The aftermath of the Yom Kippur War, October 6-24, 1973
It is believed that wars taking place on the territory of other states accelerate the economy by increasing military orders, and it is fashionable to cite the Second World War as an example, which, according to experts, gave a huge impetus to the American economy, primarily by serving military needs, which contributed to US exit from the Great Depression.
As for the Yom Kippur War that Syria and Egypt waged against Israel for three weeks, the situation was similar, as while blood was being shed in one part of the world, economic growth was observed in another. It never occurred to anyone that the Arab world, which suffered a defeat in this war, would drastically reduce oil production and raise duties on supplies to the United States and Western European countries, thereby literally sawing off the branch on which they are sitting. As a result, the S&P500 index collapsed by 45%, and if the official end of the crisis is March 1975, then the return of prices to the pre-crisis level was recorded only in 1976.
Default of the state debt of the Russian Federation on August 17, 1998
Many will say that this default was obvious and was expected from day to day, and the rubles were not converted into dollars only because there were more urgent matters, but, as is typical of the Black Swan, this day came unexpectedly, even for the “visionaries” themselves. “.
The default led to the collapse of one of the largest hedge funds Long-Term Capital Management, which, without looking back at the risks and the size of the debt, made the main bet on high-yielding debt obligations of the Russian Federation.
Terrorist attack of September 11, 2001
In this case, it may seem that this Black Swan was impossible to predict at all, however, there are a number of “Experts” in all fields of knowledge who claim that the installation of interlocking bulletproof doors is quite obvious, and therefore this incident could well have been prevented.
It is worth noting that the impact of this Black Swan on the global economy was not so strong, but it radically changed the course of history, causing wars in Afghanistan, as well as Iraq, and armed clashes in the Middle East, positioned as a fight against terrorism, have not subsided so far.
Under-swans of our days
One of the main properties of the Black Swan is that its arrival can take place at any moment, and even in the very near future, just no one knows about it. The crash of the Boeing 737 MAX airliner that took place in 2018, although it was perceived as a tragic event, was quite standard, but the second crash of this aircraft model caused a slight panic in the world. Without waiting for the third blaze of the Boeing 737 MAX model, the world simply decided to abandon the widespread operation of such aircraft, and although a major airline has suffered quite seriously, the public is safe.
Many see the manifestation of the Black Swan in the confrontation between the economies of China and the United States, arguing that the “Trade War” will lead to a complete breakdown of all economic relations, as a result of which the world will see a collapse stronger than what took place in 2008. However, the predictions of the heralds of the apocalypse are still far from reality, while the number of news stories created by the economic confrontation between Beijing and Washington is declining. Natural disasters can also be designated as a kind of “suppliers” of Black Swans on a regional scale, and no one can guarantee that the next earthquake or typhoon of a regional nature will not have a global impact on the life of all mankind, which could happen at Fukushima.
Good Black Swans
The greatest discoveries of mankind that occur unexpectedly can also be classified as Black Swans, and as an example, we can cite a smartphone, the appearance of which is quite an obvious continuation of the development of technology, but this fact is also a kind of Black Swan, like the development of an internal combustion engine, the creation the nuclear bomb, the deciphering of DNA, and the advent of the Internet.
Personal Black Swans
In his book, Taleb describes the situation with the Black Swan, which radically changes the life of one specific person, while adhering to the opinion that representatives of creative professions may well create a Black Swan by writing a brilliant bestseller, a world-class musical hit, or an outstanding picture.
However, there are professions in which the chances of a Black Swan occurring tend to be zero, such as a waiter or masseur.
Conclusions
It should be clearly understood that the absence of the Black Swan has allowed mankind to regulate the economy with the help of a system of checks and balances, and the world economy can grow without it, but the Black Swan can serve as a kind of trigger. So, a good Black Swan can lead a far from the most successful company to a breakthrough in the future, since few could have imagined that a company that started its journey in 2004 with the sale of smartphones, in 15 years will become the first to overcome the barrier of capitalization in the amount of one trillion dollars.
