Black swan problem

You may have heard of the black swan problem. It relates to the theory of induction put forth by Sir Karl Popper and later by David Hume.

It was, however, John Stuart Mill, an economist and philosopher, who put it in perspective: "No amount of observations of white swans can allow the inference that all swans are white, but the observation of a single black swan is sufficient to refute that conclusion."

How does this link to the above issue on stocks? That stocks have outperformed all investments in the long run (and therefore less risky) does not necessarily mean that it will continue to do so in the future. In other words, your decision should not be based just on history.