In ancient Egypt under the pharaohs... scribes would look up the records of the Nile's high water levels, using them as a reference standard for the worst-case scenarios that might occur in the future. The Japanese government had similar considerations when constructing the Fukushima nuclear reactors, but in 2011, when the tsunami struck, a catastrophic accident occurred. When building the reactors, the worst-case scenario considered was the most severe earthquake in recorded history, but they did not consider the possibility of something even worse—they did not think that the worst event in history was itself an accident with no precedent to refer to.

Here, the cause of failure lies not in analytical error, but in a poverty of imagination. Recognizing that "the future is not necessarily linked to the past" is important, but this is not given much weight in the field of financial forecasting.