How to Deal with Black Swans
The Black Swan is a really interesting book on how to think. Some key takeaways which are relevant today—
1) The Narrative Fallacy
People like stories. The most basic form of a story is A did B because of C and then D happened. We like stories so much in fact, that we will morph almost anything we see into one. Some stories I’ve seen—
China spread coronavirus because they lied about how bad it was and now it’s everywhere.
The Government didn’t shut pubs/restaurants down quickly enough because they’re incompetent and now people are dying.
Everyone’s overreacting because they’re scared and we’re going to have a recession.
Panic buyers have emptied supermarket shelves because they’re selfish and now there’s no food left.
Stories like this are simple and 1-dimensional. Whilst there might be some truth to them — they don’t tell the whole picture. News spreads when it’s packaged in an easy-to-follow narrative.
2) Silent Evidence
Diagoras, a nonbeliever in the gods, was shown painted tablets bearing the portraits of some worshippers who prayed, then survived a subsequent shipwreck. The implication was that praying protects you from drowning.
Diagoras asked, “Where are the pictures of those who prayed, then drowned?”
If government interventions work, and we leave this pandemic relatively unscathed — what will people think?
We overreacted. The economy’s in the tank because of social distancing. I told you!
That’s the problem with silent evidence.