If the probability for black swans cannot be estimated, how do you identify the possible black swans (to position yourself accordingly as Taleb advises)? I think he swept this under the rug.
You can't identify Black Swans; you can just assume that a lot of assets are priced as if they don't exist. So you could do what he was doing as of a year or two ago, and bet that oil will go to $10. Or $400. These are cheap bets, and he doesn't expect them to pay off -- but if he also bets that housing will double again or drop 20%, and that treasuries will yield 1% or 20%, and that a third party candidate will be elected to the US presidency, and that the US will experience net emmigration within ten years, and that global temperatures will decline over the next fifty... make enough of these very, very cheap bets, and you wind up with positive exposure to all the future events you didn't think of.
So you are not betting on black swans themselves, but you are betting on their results. Thank you for this insight.
If I understand his last statement correctly, he says don't look for anything in particular, just keep searching.
He's saying you cannot identify the possible black swans - almost by definition.