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8:30 AM EST, Tuesday, April 24: "Why are stockmarkets rising?" a friend asked last night. Simple. The economy is booming. You can see it in the very strong first quarter reports by industrial companies, i.e. ones that physically make things. You can feel it in your suppliers. They're stretched and late.

For those of us trying to get something done -- like a house built or a book printed, the manufacturing boom is immensely depressing. Worse still is the arrogance of many late suppliers. There's plenty of work around; the customer will wait. Feed him soothing lies while he waits.

Stockmarket lore says the stockmarket predicts the economy nine months out. It's contradicting what the economists are telling us; namely there'll be a recession in the second half of 2007.

You know my theories about predictions: Don't make too many of them. Stay diversified. That's the only way to mitigate against the unpredictables, like the monsoonal rains that hurt Kagara's recent zinc production, (but not its copper production). Sunday's New York Times had a review of Black Swan, which included:

The hubris of predictions — and our perpetual surprise when the not-predicted happens — are themes of Nassim Nicholas Taleb’s engaging new book, “The Black Swan.” It concerns the occurrence of the improbable, the power of rare events and the author’s lament that “in spite of the empirical record we continue to project into the future as if we were good at it.” We expect all swans to be white and are shocked when a black swan swims by.

Born in Lebanon in 1960, Taleb lived through a “black swan” when his serene homeland [and it was serene, I was there] was cast into the chaos of civil war in 1975. After emigrating to the United States, he attended Wharton, then worked on Wall Street; today he is a professor at the University of Massachusetts. Black Monday in 1987, when Wall Street suffered its worst single-day decline in modern history — in a drop that started for no clear reason — was his epiphany. Chance, he realized, has far more influence than we care to admit.

In his 2001 book “Fooled by Randomness,” which became a surprise hit in the months after the Sept. 11 terrorist attacks, Taleb drew on his experience as an options trader to argue that stock-market projections are worthless because no one has any idea where prices are headed. After prices unexpectedly rise or fall, he wrote, experts impose specious retroactive narratives to divert attention from their ignorance. In “The Black Swan,” Taleb proclaims that the unexpected is the key to understanding not just financial markets but history itself.

History, he writes, proceeds by “jumps,” controlled by “the tyranny of the singular, the accidental, the unseen and the unpredicted.” Gradual change is our paradigm, yet actual change is “almost always outlandish.” And don’t get Taleb started on The Experts. Experts are charlatans who believe in bell curves, in which most distribution is toward the center — ordinary and knowable. Far more powerful, Taleb argues, are the wild outcomes of fractal geometry, in which anything can happen overnight. (“The Black Swan” is dedicated to Benoit Mandelbrot, godfather of fractal geometry.) ...

Taleb ridicules distinguished economists while presenting himself as a lonely, persecuted genius. He declares that Harry M. Markowitz and William F. Sharpe, winners (with Merton H. Miller) of the 1990 Nobel Prize for theories of capital markets, sold “quack remedies” that “everyone in the business world” knew to be “fraud.” Taleb asserts that another Nobelist, Myron S. Scholes, flew into a “state of rage” on hearing his ideas, while a member of the French Academy of Sciences “blew a fuse ... right when I showed empirical evidence of the role of black swans in markets. He turned red with anger, had difficulty breathing and started hurling insults at me.”

Criticizing the accomplished is healthy; mocking them because they are accomplished is sophomoric. Given the thousands of smart people trying to game the global equities system, it’s a wonder the market mainly rises and that things don’t go haywire more often. Maybe the appalling theories of those sinister establishment economists actually do improve market stability.

My present concern is to figure solutions to supplier tardiness -- the Black Swan of an overstressed economy. I admit I have no answers. In recent weeks, I've tried logic. I've tried begging. I've tried screaming. Clearly one solution is a late penalty. You have to negotiate that up front. And in today's over-strained manufacturing and contractor world, I don't think many would agree to late penalties, and adhere to them. Many of my friends are being hit with price increases on fixed-price jobs. "Pay it or we walk off the job."

The emotional drain can he hefty. In recent weeks, I've heard outright lies from several manufacturers and contractors. The most egregious was my book printer who actually told me his bindery had broken down, when he hadn't even started printing my job.

An architect friend is buying from Asia. He says he gets better prices and faster delivery. He is buying everything major appliances to granite counter tops from Asia. Contractor friends are employing more immigrant labor.

If you're an overstrained supplier, please keep your customers informed. My book printer never bothered telling me he'd be late. I only found out when I called to check.

David Halberstam is killed in a California car crash: This is truly sad. There is a lesson. The roads are hazardous, more than I ever imagined. Two of my subcontractor employees working on my new house have been to jail because of DWI. One is serving six months for his third conviction. My family nearly got killed by a truck that veered into our lane late one evening on a country road in upstate New York. I was driving, fortunately, very slowly.

I wish there were a simple solution. Halberstam was broadsided by another car. Please wear a seat belt. Drive carefully and slowly.

Halberstam wrote 21 books. His 2002 best-seller, War in a Time of Peace, was a runner-up for the Pulitzer Prize in nonfiction.

Speaking to a journalism conference last year in Tennessee, AP reported he said government criticism of news reporters in Iraq reminded him of the way he was treated while covering the war in Vietnam. "The crueler the war gets, the crueler the attacks get on anybody who doesn't salute or play the game," he said. "And then one day, the people who are doing the attacking look around, and they've used up their credibility."

The Jewish Bra
A man walked into the women's department of Macy's in New York City.

He found a saleslady, and told her, "I would like a Jewish bra for my wife, size 34B."

With a quizzical look the saleslady asked, "What kind of bra?"

He repeated "A Jewish bra."

"That's unusual," said the saleslady. "Most of our customers want the Catholic bra, the Salvation Army bra, or the Presbyterian bra."

Confused, the man asked, "What are the differences?"

The saleslady responded. "It is all really quite simple. The Catholic bra supports the masses. The Salvation Army bra lifts up the fallen. The Presbyterian bra keeps them staunch and upright."

"What does the Jewish bra do?" he asked.

"The Jewish bra," she replied, "makes mountains out of molehills."

How to live to be 100
You can live to be a hundred if you give up all the things that make you want to live to be a hundred. - Woody Allen

This column is about my personal search for the perfect investment. I don't give investment advice. For that you have to be registered with regulatory authorities, which I am not. I am a reporter and an investor. I make my daily column -- Monday through Friday -- freely available for three reasons: Writing is good for sorting things out in my brain. Second, the column is research for a book I'm writing called "In Search of the Perfect Investment." Third, I encourage my readers to send me their ideas, concerns and experiences. That way we can all learn together. My email address is . You can't click on my email address. You have to re-type it . This protects me from software scanning the Internet for email addresses to spam. I have no role in choosing the Google ads. Thus I cannot endorse any, though some look mighty interesting. If you click on a link, Google may send me money. Please note I'm not suggesting you do. That money, if there is any, may help pay Claire's law school tuition. Read more about Google AdSense, click here and here.
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