Black Swans As nowadays all the newspapers are already filled with

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					Black Swans

As nowadays all the newspapers are already filled with reports about the current situation in the
financial world, I intended not to mention it. But the impact of the crisis forces me to think about the
possibilities of having predicted this situation, which seems to influences more lives every day in the
world. An interesting question that pops up is whether events in life are predictable. Can history be
used to predict the future or do we simply fall from one random event into the next random one? Is it
possible to predict events like the credit crunch that are highly improbable?

The theory of the black swans occurs while asking these questions. The black swan theory stands
for a philosophical observation. For ages humankind believed that all swans were white, the
evidence for this theory was found in the fact that every day only white swans could be observed.
But when the Dutch explorer Willem de Vlamingh arrived in Australia in the year 1697, he discovered
a group of black swans. In one moment, the immemorial theory of white swans was disproved. You
might believe that all the swans are white, but no matter how many white swans you observe, you
can never prove it for certain. When a black swan occurs unexpectedly, the theory is
immediately completely disproved. Events like black swans (or for example the attacks on
September 11th) are unexpected and seem to be unpredictable as the writer Nassim Taleb
summarizes in his book “The Black Swan: The impact of the Highly Improbable.”It seems that even
our exhaustive knowledge of statistics does not make us capable of fully predicting the future. Future
seems to have still some surprises for us which we we cannot predict. Well, I think that is what
makes life interesting and fascinating.

Another interesting happening is that a new board of the VSAE has entered this February and I am
proud to be the new chief editor of the Aenorm. This Aenorm is full with interesting articles
concerning various topics, like “Implications for optimal road taxes”, “Portfolio allocation in times of
stress” and “The Case of Approval Voting”. Hereby I would like to thank Lennart for all his effort for
the Aenorm during the last year and I wish him good luck with continuing his study in econometrics. I
also would like to thank Taek who is into the fantastic lay-out of the Aenorm and is already doing this
for a long time.

This April the tenth edition of the Econometric Game will be organized by the VSAE. During three
days teams from all over the world will work on a challenging econometric case. We are honoured to
welcome all the participants in Amsterdam and we wish them good luck with the case.

Annelies Langelaar


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