The Role of Statistics in Predicting Black Swans

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The Role of Statistics in Predicting Black Swans
Raj kumar, Other, India

Events having a major impact and a low probability are termed Black Swans... I am agreeing to the point that statistics has not much of a role to play in predicting them, but at the same time with the help of statistics we can know what will be the impact of a Black Swan if it arises..
Thus statistics can still help in the decision making process. Ruling out statistics will be a biased decision.

Jos Nieland, Teacher, Netherlands
Indeed statistics is useful but not for predicting/decision making in the fourth quadrant!

Raj kumar, Other, India
The fourth quadrant is extremely fragile and very complex.. We won't be able to predict the Black Swan effect reason...
But we can explore the risk associated with process by using statistics... And then amplifying them such that we can eliminate major impacting risks.
For example: in making tea if we do not add, or forget to close the gas inlet... We can easily compare the impact and then can take precaution as per that... But for complex process risk parameters will increase dramatically and analysis will be difficult but not impossible.

Statistics in Fourth Quadrant
Jos Nieland, Teacher, Netherlands
Taleb is not convinced. He just wrote a new book 'Antifragility' to convince people to decide in an antifragile and robust way when in the fourth quadrant.
The solution is not better use of statistics, because of the consequences of small probabilities. They cannot be predicted, because they are rare.


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