A Black Swan event in its simplest form is an event that comes as a surprise and has a significant effect.Â
The history of the Black Swan Theory - or the Theory of Black Swan Events - dates back to a Latin expression of the 2nd-century by Roman poet Juvenal, when he would characterize something as:
ârara avis in terris nigroque simillima cygnoâ
A Black Swan is an outlier. It is beyond that of regular expectations and as a result, nothing in the past could have predicted it.
It always carries an extreme or significant impact.
A Black Swan event, despite being an outlier and unpredictable, will certainly have a rational explanation concocted after its first occurrence, making that type of event explainable and predictable.
Examples of previous Black Swan events as described by Taleb, are the rise of the internet, the personal computer, the dissolution of the Soviet Union, and the September 11, 2001 attacks.