Bridge crash isn’t a Black Swan event

Roughly 15 years after the term “Black Swan event” gained some popularity and notoriety around the time of the 2007-2009 financial crisis, the phrase is again swirling on social media, apparently due to a link that has nothing to do with that period.

Andrew Tate, the controversial kickboxer who is facing criminal accusations in Romania, tweeted on X, formerly Twitter, that the container ship that earlier this week smashed into a bridge in Baltimore can be linked to a Black Swan event.

“This ship was cyber-attacked. Lights go off and it deliberately steers towards the bridge supports. Foreign agents of the USA attack digital infrastructures. Nothing is safe. Black Swan event imminent,” he tweeted.

None of those claims has been backed up.

What is a Black Swan event?

The term in some forms is centuries old. It was popularized in two books published in 2001 and 2007 by Nassim Nicholas Taleb, who used it to discuss unexpected events or developments, mainly in the economy, that can cause major damage. The idea rests on the notion that black swans are very rare in nature, with nearly all of the birds white.

What was the Black Swan event that Taleb described?

He referred to several unexpected economic crises that caused recessions.

One was the dot-com bust that began in 2000, following strong stock market gains and economic growth in the late 1990s, as the internet was ramping up. As some of those early companies proved unsuccessful, the economy rolled over into a modest recession from 2000 to 2002.

A bigger economic jolt came in 2007, sparked largely by the widescale bust in home prices — something that hadn’t occurred on a national scale in decades. The resulting recession from 2007 to 2009 was the deepest since the Depression, and the stock market and housing markets were battered.

What do Black Swan events have to do with the Baltimore bridge?

So far, nothing. It wasn’t an economic event and bridge collisions involving ships have happened before. At any rate, the White House has denied any nefarious plot in the Baltimore incident.

What else should I know about Black Swan events?

While the term often is used to describe unexpectedly bad economic or financial developments, they aren’t necessarily permanent.

There is no recession on the horizon and, regardless, these types of economic downdrafts aren’t unusual, occurring about every two to three years on average. Also, when the stock market declines, it invariably bounces back.

Anyone who panics about “Black Swan events” does so at their own peril.