What is the impact of the highly improbable? In this podcast, Russ Roberts interviews Nassim Taleb on black swans--unforeseen circumstances.
A warm thanks goes to Tim Schilling for this link.
The Black Swan discusses a post hoc narrative fallacy in which historians often fit a story around the facts. Taleb writes that this is a natural response for the brain to compress and recall data. But the fallacy is that hind site is always 20/20 and fails to predict black swans. In my opinion, it's like driving down the interstate while looking in the rearview mirror.
This book is so impacting the way I interpret data and think about economics, that I now give the book away as a graduation present. As an aside, I first met Tim at the FED Challenge a few years ago. Because of this book, I think I can select a team that can compete at a high level.