Investors need to be aware that rare events with an extreme impact that,
afterwards, we think we could have predicted—in short, black
swans—happen in the markets. Those who are trying to measure risk in the
financial markets need to carefully distinguish risk, with its probabilities,
from uncertainty, which cannot be measured. We have become increasingly
vulnerable to black swans because our financial economy has come to play an
ever-larger role in our productive economy.