What I’m reading: The Black Swan

In addition to a steady diet of fashion magazines, I’m reading a lot of math stuff. (Obviously.) This book by Nassim Nicholas Taleb, The Black Swan: The Impact of the Highly Improbable, is sort of a cross between math, probability, philosophy, biology, and history.

The thing that’s getting me about this is the description of two different types of systems: one where things cluster in the middle, and one where they cluster at the outer edges (the author refers to them as “Mediocristan” and “Extremistan”). The second reminds me of the Lorenz attractor–a system where values cluster around two values instead of one.

Taleb applies his Mediocristan/Extremistan model to financial systems, which seems like nice work if you can get it. In the context of money, it seems to make sense that there would be two clusters–basically, big successes and big failures. And the Lorenz attractor has two “clusters” as well. But there are plenty of other strange attractors that are more complex. Is it possible that Taleb’s one-dimensional Extremistan has two-, three-, or more-dimensional counterparts that we can use to discuss highly improbably events?

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