Recently I was reading a news column the best predictive model for the US presidential election projects Donald Trump winning the election in November with a caveat the creator of the model himself did not trust the prediction of his model as he believed all the assumptions the model uses don’t fit in this election year as this year election is a Black Swan Election. Now what does that really mean? The possibility of Donald Trump being the Presidential Election was improbable to begin with which in the end became a possibility but still is improbable in any given scenario. The highly unlikely event of Donald Trump being elected as a Republican Nominee is for all practical reasons is being described as a black swan event by the creator of the so called model which had the best track record of predicting the presidential election winner from 1992.
Black Swans? They do exist. The black swan (Cygnus atratus) is a large waterbird, a species of swan, which breeds mainly in the southeast and southwest regions of Australia. Now how does that matter if black swans exist or not. It does matter because before the discovery of Black swans in Australia the existence of a Black swan was seen as a highly improbable event. The phrase “black swan” derives from a Latin expression; its oldest known occurrence is the poet Juvenal’s characterization of something being “rara avis in terris nigroque simillima cygno” (“a rare bird in the lands and very much like a black swan”). When the phrase was coined, the black swan was presumed not to exist. So that was in short how the phrase Black Swan Event was coined to describe an event that comes as a surprise, has a major effect, and is often inappropriately rationalized after the fact with the benefit of hindsight.