Arabs are looking to destablize Europe and the French Elections are in play. We may see a BLACK SWAN in Paris. The BLACK SWAN will propbably be sighted outside the US. However, I wouldn't go short until the SWAN is sighted and the first wave of reactions come. There will be plenty of time to make money on the retreat. E
With the myriad of global markets and products I'd imagine a 3 sigma event happens somewhere with greater than expected frequency. It may be a Malaysian stock that falls 90% ect...Or California utility rates a few years back. By definition a "Black Swan" must be a shock event. A 6% down day in the Dow doesn't qualify. Down 22% does. Many true "Black Swans", market wise, have been to the upside. To many investors (myself included) a new all time high in the Dow after the backdrop of 2000-2002's plunge is a "Black Swan." In the summer of 2002 I would have placed the odds of a 1500 SPX in 2007 at 10,000-1. To yield starved pension fund managers the notion of a 4.75% long bond coupled with $700 gold, $60 crude and record deficits is a "Black Swan." If Golden State knows off the Mav's in NBA round one, BIG, BIG "Black Swan".
Black Swans are, by definition, non-predictable. If I had to guess, it will be either 1) Energy crisis 2) China or even Asia meltdown 3) Hedge Fund crisis - industry wide 4) Massive geopolitical It's late. History tells us something is bound to happen sooner rather than later.
Isnt that something like the 'meme' Vic Neiderhoffferrer spoke about in one of his (cant remember which) books?