By Mark Gongloff
Economist Paul Samuelson's famous joke, that the stock markets have predicted nine of the last five recessions, applies to both strategic analysts, economists and traders, and to the market itself. Few economic phenomena are monitored as closely and cause as much fear as depressions.
That is why it is remarkable that the world is experiencing an economic turmoil comparable to the Great Depression, without many realizing it.
In fact, the prevailing view today says it is best not to talk about the source of this turmoil —which has silently transferred trillion dollars to less productive uses— because this is not considered politically wise. However, this seems a little like cutting your salary at work and trying to hide it from your husband: The more you try to avoid the truth, the more painful the outcome will be.
The roots of this economic 'destruction' lie in natural disasters, the number and intensity of which have increased with global warming. Over the past 12 years, $13.5 trillion of world wealth has been channelled into restoring disaster damage, preparing for new natural disasters, and paying higher insurance premiums, according to the estimates of a recent report by Bloomberg Intelligence (BI), Andrew John Stevenson's analyst. This amount corresponds to approximately the cumulative financial losses caused by the Great Depression over a period of 12 years. It is also over four times the amount lost during the Great Depression, if adjusted to inflation. Since 2000, these costs have reached a total of $20 trillion, according to Stevenson's calculations.
The US has allocated over 50% of the total amount of 12 years, i.e. $7.2 trillion, to the "Disaster-Industrial Complex" [sp. When dealing with natural disasters or crises turns into profitable business activity] — twice the cost of the Great Depression. China has spent $2.4 trillion on preparation and rehabilitation, despite not having a private insurance market, while the European Union and the United Kingdom have spent a total of $1.6 trillion.
These costs are certainly positive for companies involved in restoring the damage caused by nature. BI's "Repair Group", which consists of 65 companies, such as Home Depot Inc., the Core & Main Inc infrastructure company. and Copart Inc. (specialized in vehicle recovery), exceeded the S&P 1200 index by 23% the previous year and about 9.3% annually over the last five years, according to BI data.
Meanwhile, BI's Prepare Group, consisting of 64 companies that help customers prepare for disasters —including the colossals of Aon PLC and Swiss Re AG reinsurance, Parsons Corp. active in the fields of technology, defence and infrastructure, and generator manufacturer Generac Holdings Inc.— It exceeded S&P 1200 by 31% in the last year and by an average of 15% in the last five years.
In other words, Wall Street has realised this transfer of wealth and reacted accordingly for the benefit of investors. However, this does not contribute particularly to future economic growth. The capital that could have been spent on the development of the flying cars that had been promised to us is directed instead at rebuilding houses and strengthening protection against fires and floods.
And these damage will increase as the environment becomes increasingly chaotic. Any increase in global temperature by a degree of Celsius relative to the pre-industrial era will remove 20% from global GDP, according to the National Bureau of Economic Research estimates.
Unlike the current US government, the market also seems to understand that climate change feeds "Disaster-Industrial Complex". BI's "No-Impact Group", which includes companies that help customers increase their energy efficiency, such as Carrier Global Corp. and Siemens Energy AG, has surpassed the S&P 1200 index by 53% in the last year and 20% in the last five. The increase in energy efficiency saved 11.5 exajoulas energy last year, notes Stevenson — more than twice the energy produced by solar and wind energy together. All of this contributes to reducing carbon dioxide emissions that heat the planet.
Of course, previous performances do not guarantee the future. This column is not investment advice. Its purpose is simply to draw attention to the fact that investors bet dynamically on climate change —Both its effects and efforts to combat it— Just when the very concept of climate change seems to be in political and cultural 'exile'.
And not only do I mean President Donald Trump's government, which has banned any official recognition of the existence of climate change, has deleted environmental data from government websites, has attacked the relevant science and has prevented both investments in clean energy and adaptation measures. Nor do I mean only the large technology companies removed from previous environmental commitments, as the temptation to build energy-intensive data centres proves too powerful to resist it.
Even apparent allies of the climate struggle have recently argued that we should simply abandon him. Last week, Syracuse's geology professor, Matt Huber, published an opinion article in the New York Times entitled: "Forget climate change. Democrats need to talk about other issues." Of course, the picture accompanying the article showed a planet reacting in shock as it slipped through two careless human hands.
Το άρθρο πυροδότησε μια έντονη αντιπαράθεση στα μέσα κοινωνικής δικτύωσης, στην οποία συνέβαλε και η δήλωση του Χιούμπερ στο Bluesky ότι η κλιματική αλλαγή αποτελεί ζήτημα που ενδιαφέρει κυρίως την “μορφωμένη/ευκατάστατη βάση” του κόμματος. Στην πραγματικότητα, τουλάχιστον οι μισοί Αμερικανοί σε κάθε πολιτεία των ΗΠΑ —ακόμη και στις “κόκκινες”— ανησυχούν για την κλιματική αλλαγή, σύμφωνα με τους πρόσφατους “Χάρτες Κλιματικής Κοινής Γνώμης” του Yale.
Οι Times άλλαξαν αργότερα τον τίτλο σε έναν λιγότερο αμφιλεγόμενο: “Οι Δημοκρατικοί δεν χρειάζεται πλέον να κάνουν προεκλογική εκστρατεία για την κλιματική αλλαγή”, αλλά η ζημιά είχε ήδη γίνει. Αυτό προστέθηκε στη γενικότερη τάση του “greenhushing”, την οποία ο πρώην υπέρμαχος του κλίματος Μπιλ Γκέιτς “νομιμοποίησε” πέρυσι, υποστηρίζοντας ότι η εμμονή με την άνοδο της θερμοκρασίας ήταν “τόσο 2015” και λέγοντας στους προοδευτικούς να εστιάσουν, αντ’ αυτού, στη βελτίωση του παγκόσμιου βιοτικού επιπέδου.
Ο Χιούμπερ, ο Γκέιτς και άλλοι μπορεί να έχουν ένα βάσιμο πολιτικό επιχείρημα: Αν είσαι Δημοκρατικός πολιτικός που προσπαθεί να κερδίσει κυρίως συντηρητικούς αναποφάσιστους ψηφοφόρους σε αμφίρροπες εκλογές, τότε πιθανότατα θέλεις να αντιμετωπίσεις το κύριο μέλημά τους, το οποίο αυτές τις μέρες είναι εκείνο το μεγάλο νούμερο στον πίνακα πάνω από το βενζινάδικο. Το να μιλάς πάρα πολύ για την “κλιματική αλλαγή” ως μια αόριστη έννοια, πιθανότατα δεν θα φέρει το επιθυμητό αποτέλεσμα.
Από την άλλη πλευρά, το κόστος ζωής και η κλιματική αλλαγή είναι όλο και πιο αλληλένδετα. Η ενεργειακή κρίση που προκάλεσε ο πόλεμος στο Ιράν ίσως να μην ήταν τόσο οδυνηρή, και ο τεράστιος αριθμός πάνω από το βενζινάδικο να μην ήταν τόσο υψηλός, αν οι Αμερικανοί διέθεταν περισσότερες από τις εναλλακτικές πηγές ενέργειας που ο Τραμπ και άλλοι επιμένουν να εμποδίζουν. Τα έξοδα ασφάλισης κατοικιών ίσως να μην εκτοξεύονταν στα ύψη σε ολόκληρη τη χώρα, καθιστώντας τη στέγαση απρόσιτη για πολλούς, αν είχαμε λάβει πιο σοβαρά υπόψη από την αρχή την υπερθέρμανση του πλανήτη και τις επιπτώσεις της.
Η επίλυση αυτών των προβλημάτων θα απαιτήσει τελικά να αντιμετωπίσουμε την πηγή τους. Η χρηματιστηριακή αγορά, τουλάχιστον, μας δίνει ήδη την άδεια να το κάνουμε.
