Template:Apocalypse maxim

Let us coin a maxim:

“before an apocalypse becomes an apocalypse, it doesn’t look like an apocalypse”.

The studied, logical outrage vouchsafed by those in the riskless position of having twenty-twenty hindsight and engaged in the fruitless, if satisfying, pursuit of blaming the meatware was not available to those on deck at the time. No-one knew or — at least until it was too late, even believed — that things would turn out like this. Q.E.D.

Ergo, the decision calculus then was nowhere near as obvious as it appears now, as an object in the rear-view mirror: if it had been, the catastrophe would not have happened.

Furthermore, it is one thing to have a legal right to pull your trigger, it is quite another to resolve to use it. Especially if you don’t know how this all will play out.

After the event, the client is a smoking hulk; all that remains is twisted wreckage strewn across the landscape. Now, it could not be more obvious: there was only ever one option.

Before it, there were twenty million dollars of annual revenues at stake: few individual risk managers will be prepared to blow up a key client on their own initiative, without diffusing responsibility through some kind of institutional escalations. But going to a Counterparty Risk Oversight Committee takes time. And CROCs are fraught, intimidating things. To recommend affronting a platinum client is to invite a shellacking from those a long way further up the tree than you.

Now: if these are the options, and our valiant risk manager doesn’t yet have that twenty-twenty hindsight of what might come about tomorrow — she won’t remember, Q.E.D. — is it any wonder she’ll be tempted to do nothing?

Before an apocalypse becomes an apocalypse, it doesn’t look like an apocalypse.