Finally European explorers sighted a black swan in Australia in 1697 and a pair were captured in 1726. Turns out black swans are common enough in Australia and New Zealand.
About that David Hume…the Scottish logician-philosopher who lived from 1711 to 1776 …wrote: “No amount of observations of white swans can allow the inference that all swans are white, but the observation of a single black swan is sufficient to refute that conclusion.”
In the hands of logicians like Hume and mathematician-investors like Nassim Taleb, the author of the 2010 book on randomness called The Black Swan, the possibility of ‘black swans’ is a problem of logic and probability and for Taleb especially, a monumental challenge in generating reliable investment returns at an acceptable risk.
Here’s how Wikipedia summarizes Taleb’s ‘black swan theory.’
“The theory was developed by Nassim Nicholas Taleb to explain:"
- “The disproportionate role of high-profile, hard-to-predict, and rare events that are beyond the realm of normal expectations in history, science, finance, and technology.” (Hurricane Sandy, for instance)
- “The non-computability of the probability of the consequential rare events using scientific methods (owing to the very nature of small probabilities)."
- “The psychological biases that make people individually and collectively blind to uncertainty and unaware of the massive role of the rare event in historical affairs.”
Instead I ask, where are the black swans of cause marketing? That is, what’s possible but hasn’t been seen yet? And, perhaps more interesting, while cause marketing enjoys relatively high esteem right now, what unexpected events could change the public's perception?
I hope you’ll weigh in in the comments section below.