Mark Crovelli writes on Mises.org Brazil, that the central message of the Black Swan is “PROBABILITY IS SUBJECTIVE AND SHOULD NOT BE TAKEN TOO SERIOUSLY”. Then on his Facebook page asks for thoughts.
Well, it is always dangerous to ask for opinion after you publish something rather than before. 🙂
The central message of The Black Swan is that we should not fool ourselves into thinking our models are predictive, because we cannot forecast severe events, and if we use forecasts to create policy that does not tolerate severe events, then we will of necessity create fragility.
And he doesn’t just mean economic corrections. He means, depressions, civil war, and poliitcal dissolution or conquest.
His narrative starts with the belief among the diverse Levantine peoples that they were ‘special’. That the rest of the world was foolish. That they had solved the problem of diversity.
And they learned that they were wrong. Their society was conquered and died because of it. And now, instead of being a exception in that world, it is just another poor part of it.
It’s this kind of severity he’s warning us about in the black swan. He’s just using his experience with the financial markets to illustrate in clear terms how a financialized society and a financialized government, can produce policy that results in fragility.
The black swan is a warning about fragility. It is a restatement of conservatism’s core tenet: a warning against innate human hubris — in practical terms, with modern examples.
So, while you might believe you’ve simplified his statements, I think that you have laundered, by the use of aggregates, what is valuable in them — just as we Austrians argue that Keynesian aggregates eliminate all meaningful information from economic data, and thereby ignore the inter-temporal settlement that is a mandatory component of the process of production, and the human calculation and incentives that follow.
This is not a mistake our side of the fence is supposed to make. 🙂
Anyway, cheers for taking on a hard subject. 🙂