The Top Gray Rhinos of 2020: A Review and Peek Ahead at 2021


At the risk of gross understatement: What a year 2020 has been.

And yet… Even with the enormous human cost of the pandemic in lives and livelihoods, even with the protests and angst and upheaval, even as terrible as 2020 has been, the gut-wrenchingly volatile past 11 months hold two glimmers of hope. First, the argument for systemic change is as strong as it has been in recent years. And second, surprisingly: even though the year could have and should have gone much better, it still could have been even worse.

On the season wrap of the Breaking the Fever podcast this week, I had the honor of discussing both of these themes with Charles Hecker of Control Risks, with thoughtful moderation from Jerome Tagger of Preventable Surprises and Alison Taylor of Ethical Systems. We looked back over 2020 and peeked ahead into what’s in store for 2021. Hint: you may not want to release that big sigh of relief just yet. (Click HERE to listen to the conversation.)

As regular readers know, early each year I release an annual Top Ten Gray Rhinos list, which is a meta-list that draws patterns out of dozens of top-risks, forecasts, predictions and outlooks from around the world and across industries. If gives me a sense of what keeps others up at night and how those concerns line up with my own. I normally do a pulse check mid-year, but between this year being so strange and being on deadline for my new book coming out next spring, I skipped that this year. (Now that it’s in page proofs, I’ll be much less scarce here!)

But as the year closes –and, gulp, as the first 2021 lists trickle in—I’ve been thinking about how these risks and our responses have evolved. I recently wrote about what’s in store for 2021 for The Economist’s The World Ahead/The World in 2021. I am particularly worried about financial fragilities including rising inequality, climate change related risks and financial imbalances such as dangerous corporate-debt levels and asset bubbles. The “K-shaped recovery” we are experiencing, in which the rich get richer and the poor poorer, makes these dangers worse.

Very briefly below I’ll summarize how each of the top five gray rhino risks of 2020 has evolved and set the stage for 2021.

1) Economic and financial fragilities. This year’s predictions and top-risks lists included slowing economic growth, possible credit and liquidity events, market volatility and deteriorating sentiment, high global debt, and interest rate changes. Well, 2020 hit all of those on the head, though perhaps with the exception of the direction of interest rates, which pre-pandemic many people expected to go up instead of down.

The dizzying heights that financial markets have reached are macabre in face of continued joblessness, bankruptcies, delinquent rent, and zombie companies. Bloated price-to-earnings ratios and an eventual end to fiscal and monetary stimulus will eventually send this house of cards scattering.

Debt to GDP ratios have been rising as governments have reached deep into their pockets to provide pandemic relief. Yet a critical mass of economists continue to warn that the bigger danger is not from governments spending too much to support distressed populations and economies, but rather too little. Lower interest rates have made some debts more manageable in the short term. Eventually the piper will need to be paid, but that’s not even the biggest short term worry.

Mortgage delinquency data is hard to read, given the forbearance many banks have given as part of pandemic relief, keeping the official number of distressed US mortgages off-books. But analysts expect the numbers to rise in 2021. If pandemic related federal restrictions on evictions expire in January and states do not step in with their own restrictions, the number of people losing their homes will rise dramatically; here in Chicago it could be 13 times the pre-pandemic monthly number. Landlords have to pay their own mortgages and bills and are struggling under the burden of unpaid back rent on both residential and commercial mortgages.

2) Political uncertainty, both domestic and geo-political. Political uncertainty was at dizzying heights, intensified by the number of world leaders who caught COVID-19. The US presidential election and transition period have been anything but smooth. While a growing number of Republican leaders are recognizing the legitimacy of President-elect Joe Biden’s decisive victory, a startling minority of Americans are holding on to doubts that President Donald Trump has fueled with a barrage of lawsuits. Even though courts and other democratic institutions have held so far, decisively rejecting Trump’s quixotic challenges, he and his supporters nevertheless have inflicted serious damage.

The pandemic, which has hit non-white Americans disproportionately, has intensified the spotlight on racial disparities and inequities. Protests over the late spring and summer over the police brutality killing of George Floyd had two distinct and diametrically opposed effects. On the positive side, they drew awareness to the depth of the problem and increased the number of Americans who recognized racism as a serious problem for non-whites, and in turn prompted public commitments from some corporations to fixing inequities. Unfortunately, they also intensified the position of white supremacists and their sympathizers, increasing polarization.

Geo-political challenges will continue into 2021, as struggling economies raise the temptation for politicians to resort to beggar-thy-neighbor trade and immigration policies alongside balance-of-power posturing. It is a relief that the Biden administration is unlikely to engage in the kind of chest-thumping that was a hallmark of the Trump administration; however, that does not guarantee a road bump free geopolitical landscape.

3) Climate change. The good news of the year is that public recognition of climate change seems to be rising, particularly in the investment community. I fielded a number of calls from reporters over the spring who wrote about the importance of making sure climate change continued to get attention and not get overshadowed by the pandemic.

ESG funds have outperformed traditional investments by many measures. There’s increasing attention to the importance of climate risk assessment, financial reporting, standards, and pricing. The Biden administration is expected to make climate-related financial rules a priority.

Whether the newfound attention will suffice to arrest the climate crisis is another matter entirely, as a critical mass of informed observers warn that it’s still not enough and that our window for effective action is closing.

4) Cyber and digital risk. The recent cyberattack on multiple US government agencies via the third-party software vendor SolarWinds is merely confirmation that executives and policy makers had good reason to keep cyber security high on their worry lists. The SolarWinds hack in turn has brought cyber-security into the vortex of supply chain worries.

Broader digital infrastructure questions, along with the challenge of securing the connections and hardware for work-from-home employees, have bedeviled companies as well. The shift of broadband use from central business districts to residential areas has left network providers struggling and (as I can attest from personal experience) has frustrated users subject to service interruptions.

5) Supply chain risks. While companies and policy makers already had supply chain risks on their worry lists, the pandemic put the issue into hyper drive as it shut down manufacturing and food processing plants and snarled global transportation routes.

Supply chains have bounced back from the shell-shocked state they were in during the spring, but companies are still working to move from the pre-pandemic lean, just-in-time supply chain models, which proved to be too lean, and to replace them with more robust logistics and inventory models.

Companies are looking to diversify their supply chains as well as (re)regionalize or (re) onshore them. They are keeping bigger inventories on hand. And they are keeping an eye on potential new geopolitical trade policy shocks as weak economies tempt politicians to dabble in the same kind of beggar-thy-neighbor policies that made the Great Depression worse –especially if social unrest escalates.

Hopefully you will have noticed a significant overlap among these top five risks which combine in a system: climate risk increases financial risk, which increases social and political risk, which in turn interact with supply chain risks, which in turn are connected to cyber risks. Without addressing them all, we remain vulnerable.

So where does this leave us?

Peter Turchin, who teaches cultural evolution at the University of Connecticut, predicted in 2010 that a wave of social unrest would sweep across the United States starting around… 2020… based on his analysis of key indicators that mark shifts in secular political and economic cycles. “In the United States, we have stagnating or declining real wages, a growing gap between rich and poor, overproduction of young graduates with advanced degrees, and exploding public debt,” he wrote in Nature just over a decade ago. “These seemingly disparate social indicators are actually related to each other dynamically. They all experienced turning points during the 1970s. Historically, such developments have served as leading indicators of looming political instability,” he wrote.

Turchin also identified demographic trends combining with other cyclical economic factors as combining with those social indicators to converge around now. We might think of the kind of unrest that he predicts as what I call “recurring gray rhinos”: things we’ve seen before and will see again. Interviewed recently, Turchin warned that things could get a lot worse. “Things are not as bad as they could be,” he told Time magazine recently.

This brings me back to the earlier point: that as bad as 2020 has been, it could have been worse. And if we don’t act sooner and more decisively, things will get worse. As we look ahead to 2021, it’s hard to over-emphasize the urgency of dealing with the gray rhinos charging at us.

This article is part of my LinkedIn newsletter series, “Around My Mind” – a regular walk through the ideas, events, people, and places that kick my synapses into action, sparking sometimes surprising or counter-intuitive connections. 

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Michele Wucker

About Author

Michele Wucker is a global thought leader and the author, most recently, of THE GRAY RHINO: How to Recognize and Act on the Obvious Dangers We Ignore (St Martin's Press, 2016). Learn more about her at

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