Could spark a recession?
Will ignite the permanent recession more likely and will almost certainly initiate a far worse Depression than back in the thirties. How could catastrophic climate change not cause a dire economic crisis world wide?
One person’s recession is another’s investment opportunity–as the patriarch of the Rothschild banking family once explained his business plan: “When blood runs in the streets of Paris, I buy.” (see also Naomi Klein’s work on disaster capitalism)
“likes of which we have never seen before “ That was very Trumpian.
The operative word not used here is “collapse.”
Hace 30 anyos estos supuestemente expertos predictaron que que el globo calienta y los mares suben. Pero, la tierra madre se vee igual hoy quen en 1990.
Exactly. We have to once again redefine money. There is money to give to the rich and the poor, money for wars, military budgets, and financial loans. None for infrastructure to build better dams, dikes, and levees.
To mitigate pollutants.
We can borrow FEMA money, so what’s the problem. We borrowed to work our way out of the “depression.”
We need to restart our money and begin with dollars the way nickels had value a century ago.
No more trillions, billions, millions.
Quizás si supieras leer no dirías cosas tan ignorantes. Por otro lado, tal vez le pagan por decirlas. Así que vete, gusano.
Yes indeed. Calling it “unpriced risk” is like saying if you jump off a 500 foot cliff you’re underestimating the risk.
Markets can not properly assess risks posed by Climate change?
The issue IS that we rely on Markets to model our economy. Leaving it to the market to assess the risks is what got us here in the first place. The risks posed by Climate change should have nothing to do with what the markets want and the solution to those risks is acting in the best interests of the Environment first and foremost and not the Markets.
Eruditely stating the already obvious.
Real-world events are far ahead of all the expert analyses.
There are poorly calculated risks, and then “unknown unknowns”.
A very ill wind is circling the globe right now.
Markets refer to things they can’t put a monetary value on–such as clean aquifers and breathable air–as “externalities.” In my experience, markets are really stupid.
Some thoughts on this article which states: “Unpriced risk was the main cause of the Great Recession in 2007-2008.”
Really? It’s that simple?
Pushing infinite growth on a finite planet will not only lead to “global recession” but complete biosphere collapse.
“Anyone who thinks that you can have infinite growth on a planet with finite resources is either a madman or an economist.” - Sir David Attenborough
The true “unpriced risk” is capitalism which depends on the commodification of—among other things— nonhuman life forms.
Alyssa Röhricht has an excellent piece that she wrote a few years ago about capitalism and the climate crisis.
And a few more things to keep in mind that go beyond the simplistic “unpriced risk” statement:
"Widening inequality makes our economy susceptible to financial disaster."
“Wall Street, big corporations, and the wealthy have essentially bought up our democracy.”
Quotes in italics from Robert Reich: (ttps://www.truthdig.com/articles/3-crucial-lessons-we-failed-to-learn-from-the-great-recession/)
Right now, there is an enormous goddamn Wall Street bubble. There is an ever growing real estate bubble (again). Oil prices are being held artificially low. The US trade deficit is enormous. Personal debt is at record levels (14 trillion). Government debt at all levels is growing almost exponentially.
And now, the earth is warming at an unprecedented pace.
Recession? Recession if we’re lucky. What is coming could be best described as Tribulation.
I blame Karl Marx and his historical materialism, which pretty much marx (sorry) the birth of the pseudo-science we call economics. So far as I know.
From that moment, the monstrous pseudo-reality – economic reality – has bulged into a tumor much more real than planet Earth to most folks – especially educated folks. Will this pseudo-reality ever bear any relation to physical reality? Who knows? Maybe we’ll see a booming market in scorched earth.
I nearly stopped reading at the phrase: " Without better knowledge of this risk, the average energy investor can only hope…" The author of that study has truly drunk the kool-aid.
There is no such thing as an “average” investor. Studies show than less than 10% of the population do more than 90% of the trades. What is average about this?
The markets anymore are about speed and volume. It’s not about doing your research, calculating risk, and holding onto an investment in a company that you believe in. The High Frequency Traders (quants as they are known) develop ever more sophisticated algorithms to beat the other guy’s algorithm. How many average investors even know what an algorithm is!!! Trades are done in one one-hundredth of a second. And each of trades contain thousands of shares. These huge trades are done billions of times every single day. What is average about this?
Added to that, the whole system is rigged so that trades from certain firms or individuals or whatever get to jump the queue and get the lowest buy price and the highest sell price.
It’s a ponzi scheme that is only kept alive by duping people into believing that there is a place in the markets for an average investor. These dupes are the “marks” that that the big players need to get in ever increasing numbers in order to keep the scheme going.
But these days there are fewer and fewer marks available - thus why the multi nationals are buying back their own stocks with the free money that the Fed is printing (that we the taxpayers have to pay for as interest on the national debt). They have to do it because the average among us don’t have any money to invest.
The ponzi scheme will totally collapse as they always do. But I’ve been saying this for 2 decades and now I’m beginning to think that total environmental collapse will happen first.
In case any average investors would like to know, it’s not one of the deepest mysteries of our uber-technical cult. It’s a fancy word for “directions” – like a cookbook recipe. Now all you average investors know as much as most of the folks who write algorithms.
My definition of algorithm in the quant sense would be: A means of setting things spinning for awhile, with no connection to anything actual.
“extreme weather events could trigger non-linear and irreversible financial losses.”–it Life that should matter, not money!
What capitalists value is certainly not Life for its own sake but how they can extract private wealth for the few through extractive industries which has gotten us all to where we are. And now we are supposed to believe the billionaires are going to save us? And all the institutions of society are complicit from places of worship, education to name two. This alone should push us out on the streets and supporting total, non cooperation.
Thank you! Great post.
I had the same reaction but kept reading out of curiosity which ended up making me feel sick to my stomach----literally.
Most people do not take the time to think about these things and how deeply this matrix of hell is rooted in our lives.