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Ravishankar Iyer

#SOTD 75: Is the world going nuts (or is it just probability)?

Published about 2 years ago • 1 min read
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Humans have an ability to overemphasise the impact of recent events - especially if they are adverse ones.

This year its the Russia Ukraine war and runaway inflation. The two years before that... well no one needs a reminder...

It seems like we are in a period of constant calamities, coming one after the other.

Or perhaps there is a different explanation.

Here's Morgan Housel in his latest post:

Think about 100-year events. One-hundred-year floods, hurricanes, earthquakes, financial crises, frauds, pandemics, political meltdowns, economic recessions, and so on endlessly. Lots of terrible things can be called “100-year events”.
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A 100-year event doesn’t mean it happens every 100 years. It means there’s about a 1% chance of it occurring on any given year. That seems low. But when there are hundreds of different independent 100-year events, what are the odds that one of them will occur in a given year?
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Pretty good.
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If next year there’s a 1% chance of a new disastrous pandemic, a 1% chance of a crippling depression, a 1% chance of a catastrophic flood, a 1% chance of political collapse, and on and on, then the odds that something bad will happen next year – or any year – are … not bad.

Housel is a smart thinker and a lucid writer.

In this piece, he:

  • Introduces the premise, and immediately dives into a human story (of someone who won the lottery - twice!)
  • Offers several examples to distil his main point:
The world breaks about once every ten years, on average. For your country, state, town, or business, once every one to three years is probably more common.
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Sometimes it feels like terrible luck, or that bad news has new momentum. More often it’s just raw math at work.

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#SOTD 75

Ravi

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PS: Here is the context for #SOTD and the 'Ultimate Guide to Storytelling Techniques' framework I use - in case you joined this series late! Here is the archive of previous posts. Click here to subscribe.

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Ravishankar Iyer

A Storytelling Coach More details here: https://www.linkedin.com/in/ravishankar-iyer/

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