In my internet search about the movie "The Black Swan" I came across the black swan theory, which I never heard of but found interesting. These are the principles.

1.What is fragile should break early while it is still small. Nothing should ever become Too Big to Fail.

2.No socialisation of losses and privatisation of gains.

3.People who were driving a school bus blindfolded (and crashed it) should never be given a new bus.

4.Do not let someone making an "incentive" bonus manage a nuclear plant – or your financial risks.

5.Counter-balance complexity with simplicity.

6.Do not give children sticks of dynamite, even if they come with a warning.

7.Only Ponzi schemes should depend on confidence. Governments should never need to "restore confidence".

8.Do not give an addict more drugs if he has withdrawal pains.

9.Citizens should not depend on financial assets or fallible "expert" advice for their retirement.

10.Make an omelette with the broken eggs.

[Edited 12/24/10 23:54pm]

morningsong said:

In my internet search about the movie "The Black Swan" I came across the black swan theory, which I never heard of but found interesting. These are the principles.

1.What is fragile should break early while it is still small. Nothing should ever become Too Big to Fail.

2.No socialisation of losses and privatisation of gains.

3.People who were driving a school bus blindfolded (and crashed it) should never be given a new bus.

4.Do not let someone making an "incentive" bonus manage a nuclear plant – or your financial risks.

5.Counter-balance complexity with simplicity.

6.Do not give children sticks of dynamite, even if they come with a warning.

7.Only Ponzi schemes should depend on confidence. Governments should never need to "restore confidence".

8.Do not give an addict more drugs if he has withdrawal pains.

9.Citizens should not depend on financial assets or fallible "expert" advice for their retirement.

10.Make an omelette with the broken eggs.

[Edited 12/24/10 23:54pm]

Absolutely nothing I can disagree with here. Seems so simple, doesn't it.

My kids didn't come with a warning label.

Just kidding, most of that is pretty good advice. One of the things I've learned over the years is this:

Any program or business that relies on inflation to solve its problems will fail.

RodeoSchro said:

Any program or business that relies on inflation to solve its problems will fail.

so true!

what a disturbing movie...never get that scene out my head. burned into my retinas

I haven't seen the movie yet, but I wonder if it somewhat works on this principle.There's a book on it but it doesn't sound like the movie, nothing about ballerinas or anything. The principles above sound so relevant to what's been happening over the past couple of years, it seemed so ironic.

According to the Black Swan Theory, unpredictable events are much more common than people think and are the norm and not the exception. Taleb believes that the more educated people are, the more likely it is that they incorrectly believe these unpredictable events are uncommon. Taleb says that because of an information overflow in today's society, we often don't interpret data accurately and create correlations that are not always relevant, when randomness more often is the rule. Taleb does not believe in the expertise of bankers or financial analysts and say that society incorrectly believe that they can predict the future.

In Western society, Black swans used to be a metaphor for something that could not exist, until it was discovered that they did exist

ZombieKitten said:

RodeoSchro said:

Any program or business that relies on inflation to solve its problems will fail.

so true!

twisted