Warning: Is a Black Swan Event on its Way?

SwansWhat is a Black Swan Event?

“An event or occurrence that deviates beyond what is normally expected of a situation that would be extremely difficult to predict.” The Black Swan – The Impact of the Highly Improbable. Book written by Nassim Nicholas Taleb.

However, perhaps the events were bound to happen anyway. The event’s time, location or type may be different but similar incidences have had similar effects in the past which brings forward the assumption, it just might happen again.


In 1696, Willem de Vlamingh (a Dutch sea-captain) explored the central west coast of Australia. When he ventured up a river which he later called the “Swan River” in January 1697, he observed large numbers of black swans. This was an unexpected event in history and profoundly changed zoology because it was Western belief that all swans were white. Now we had to include a new colour to this species and most likely to other species that have not been accounted for. This was an even which was typically random and unexpected, hence, “a Black Swan Event.” How do we relate this to Real Estate?


Well, right now China may be in the next Real Estate Bubble! Real estate in China has experienced a huge expansion in recent years. However, the demand for this real estate is not in parallel with the development of it. This could reach a crisis point and the consequences can be very serious for China’s economy as well as the world’s economy. As this bubble continues to grow, it’s just not limited to China but France, Germany, Canada, Australia, Switzerland and even the Middle Eastern countries. However, if the Chinese government deals with this issue now by discouraging the development and preventing social upheaval, we may save a Black Swan Event from happening. But if they don’t and they continue on the path they are on now, it even may be difficult for them to control what may happen next.


The old saying goes, learn from your mistakes. In our part of the world, we have seen a bubble burst before and it was costly to many. How can we foresee a Black Swan Event coming our way, we can’t. However, we can listen to the old timers’ theories, such as; buy real estate, rent it, buy another property, rent that and so on and so on. This is what has always worked in the past and will continue to work in the future. People always need a place to live, not only are you helping their bubble not burst which would leave them homeless when everything else is out of their reach but you are also helping to build up your own nest egg for your own future. Playing in the stock market with China being the powerhouse may be the Swan you want to stay away from, your safest bet may be what the old timer’s would say – Invest in Real Estate in your own back yard. The Niagara Region is a perfect place to start your new nest egg and investment. It has affordable housing to invest in and has room to grow. WAM has a very informative coaching program to show you how to do just that. You can also learn their creative ways on how to avoid your Black Swan Event! Please post your comments and questions below.