Chris Skinner's blog

Shaping the future of finance

This is no Black Swan

Chris Skinner Author Avatar

As the coronavirus gripped Europe and America in March and April, it was clear that banks had a number of issues to deal with. Suddenly shuttering branch doors, closing head office and asking staff to stay at home, became the modus operandi for all. This is something that no major financial institution had planned for, but my question is: why?

Oh, it’s a black swan event.

Well, no. It wasn’t a black swan event at all. It was completely predicted and predictable.

Bear in mind that the definition of a black swan event, according to Investopedia is “an unpredictable event that is beyond what is normally expected of a situation and has potentially severe consequences.”

This was not unpredictable. The US government, UK government and many other governments had scenario planned such events and simulated them, and many fictional movies and books have outlined such events occurring. We have had SARS and ebola and other diseases, so we all knew there would be a pandemic one day. There’s even a game named Pandemic which played out such situations.

In fact, The Week makes clear what we all know:

The 2011 Steven Soderbergh film, Contagion, starring Matt Damon and Gwyneth Paltrow. It grossed $135 million in the domestic box office and is currently one of the hottest films in the Warner Bros. library. The origin of the virus in that film even echoes what many scientists think occurred with the coronavirus. Hollywood wasn't making brainy thrillers about Wall Street mortgage derivatives in the early 2000s.

Moreover, in the years since the 2009 H1N1 flu outbreak, which killed more than 12,000 Americans, there have been numerous studies and public speeches from experts warning about a systemic lack of preparedness. A 2014 Department of Homeland Security study said the U.S. was ill-equipped to handle a pandemic. In 2018, the head of the World Health Organization warned, "A devastating epidemic could start in any country at any time and kill millions of people because we are still not prepared." Also in 2018, Microsoft cofounder Bill Gates said he had raised the issue of a "large and lethal" pandemic with President Trump.

In fact, Bill Gates TED Talk of 2015 even made it clear that this was coming.


This was after the 2009 H1N1 flu outbreak, which killed over 12,000 in America, and then there have been many studies looking at how to deal with a crisis. In 2014, the US Department of Homeland Security study said the U.S. was ill-equipped to handle a pandemic. In 2016, a UK simulation of a pandemic made it obvious the National Health Service would not cope and, in 2018, the head of the World Health Organisation warned that “a devastating epidemic could start in any country at any time and kill millions of people because we are still not prepared”.

I could go on – there are numerous references to pandemics dating back to the 1970s, when Stephen King’s The Stand is a good example – but what I am underlining is that this coronavirus pandemic is not a black swan.

It’s not a black swan. Maybe what is a black swan is the reaction of governments worldwide to lockdown, but that is in reaction to something that was predictable: a global pandemic.

Nassim Taleb who coined the phrase a black swan event is really annoyed that people are referring to this pandemic as a black swan event. It’s not, as he makes clear in an interview with The New Yorker magazine.

Back in January, he wrote a paper explaining that lockdown should have been introduced straight away.

“These are ruin problems,” the paper states, exposure to which “leads to a certain eventual extinction.” The authors call for “drastically pruning contact networks,” and other measures that we now associate with sheltering in place and social distancing. “Decision-makers must act swiftly,” the authors conclude, “and avoid the fallacy that to have an appropriate respect for uncertainty in the face of possible irreversible catastrophe amounts to ‘paranoia.’ ”

Interestingly, Nassim Taleb told The New Yorker that: “had we used masks then (late January) we could have saved ourselves the stimulus.”

So, given all this evidence, how come we weren’t ready for coronavirus? Why didn’t we backup our physical operations in anticipation of a pandemic that would cause our offices to close and our staff to stay at home?

Why is it that we spent years creating disaster recovery plans for if our systems crashed, but we had no plan for a physical lockdown? By way of example, I have a bank who out-sourced their call centre operations to India. India shutdown with four hours’ notice. The banks had no backup and, for the past two months when I have tried to call them, their answerphone system says sorry, we’re closed; try again later. They had no backup.

I would say that I feel sorry about that but, with all their staff at home and isolated, they are getting ten times the volume of calls with ten times less people available onshore and no call centre offshore. Tough. Why didn’t they plan for this?

I have another bank where, for two months, I’ve been trying to talk to a human. I can get through, although it takes one or two hours, but there is no point as, when I do, the person I speak with who is probably working from home has no empowerment to do anything.  Why? Because they are not allowed to access the banks’ systems from home. Why didn’t banks plan for this? Why didn’t they create backup plans for their physical operations in the same way as they do for their technical operations? Why weren’t all staff allowed to work from home before March 2020, supported by cloud-based systems with secure access remotely? Why didn’t banks consider that a pandemic might strike?

The answers to all my questions above are the same reasons as to why governments didn’t plan for this: complacency, laziness and blind stupidity.

Coronavirus is not a black swan and it is not unprecedented. It was perfectly predictable, and we should have built plans to deal with it well before this crisis hit. The only good news is that banks are now making decisions about cloud-based operations and permanently having staff at home, with technology decisions that have been bubbling away for years being made in weeks.

So much for planning.

Chris Skinner Author Avatar

Chris M Skinner

Chris Skinner is best known as an independent commentator on the financial markets through his blog,, as author of the bestselling book Digital Bank, and Chair of the European networking forum the Financial Services Club. He has been voted one of the most influential people in banking by The Financial Brand (as well as one of the best blogs), a FinTech Titan (Next Bank), one of the Fintech Leaders you need to follow (City AM, Deluxe and Jax Finance), as well as one of the Top 40 most influential people in financial technology by the Wall Street Journal's Financial News. To learn more click here...

What is the future?

Learn more

Learn more about Chris

About Chris Skinner

The Past, Present And Future Of Banking, Finance And Technology

Fintech expert Chris Skinner: countries need digital transformation to remain competitive

Join me on Linkedin

Follow Me on X!

Hire Chris Skinner for dinners, workshops and more

Learn directly from from one of the most influential people in technology, gain insights from the world's most innovative companies, and build a global network.

Chris’s latest book

Chris Skinner’s ‘Digital For Good’ Book Launch Event – CFTE

Top 50 Global Thought Leaders and Influencers on FinTech 2023

Chris Skinner
Commentator, CEO of The Finanser and best-selling author at The Finanser

Thinkers360 Thought Leader

Contact Me

Global Awards

Lifetime Achievement Award

Global 100 - 2024 Winner

Chris Skinner - Financial Markets Advisor of the Year - The Finanser - UK 2023

Best Financial Markets Advisor of the Year 2023

30 Best Regtech Blogs and Websites 2023

Kids creating the future bank | TEDxAthens

Captain Cake and the Candy Crew

Captain Cake Winner of a Golden Mom’s Choice Award


Alex at the Financial Services

Gaping Void's Hugh MacLeod worked with the Finanser