Are We on the Verge of Another Financial Crisis? | Hacker News Reader

Are We on the Verge of Another Financial Crisis?

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32 pointspseudolus16 comments

Rather like the SF earthquakes, the surest indicator is the time elapsed since the previous one. But, like the earthquakes, knowing that ones is overdue doesn't make it arrive on time.

Financial crises tend to be cascade failures. One previously-sound institution blowing up takes out another that was owed money from it, and so on. The response of pumping money into the economy like moderator coolant into a failing nuclear reactor works, but makes everyone uncomfortable. And maybe one day the crisis will outrun the pumps.

There isn’t a pattern between time and SF earthquakes[0].

0. https://www.earthquakesafety.com/earthquake-history.html

The odds of an impending event increase over time regardless of a pattern or not.

>Are We On the Verge of Another Financial Crisis?

Yes.

But not primarily for the reason the author points out.

Only if we do as much as possible to stay in this precarious position long enough will there be the possibility to rebuild the fundamentals necessary to avoid going over the edge eventually.

What fraction of houses in California are really exposed to wildfire loss? Primarily those outside of the major cities. Inside the cities? 1% of LA? And even in the worst fire season, how many of those houses are lost? 100?

What percentage of houses in California are in rural areas? 30%? And if those houses drop from $400k to $300k because the owner now has to pay market rates for fire insurance, then that’s going to destroy the economy? That’s an overall 7.5% drop in the housing stock value.

This article appears to overstate the risk.

And how many of those homes are 2nd homes or « when we retire, we’ll sell our home in the city and move there ».

Mobile homes are often the ones lost.

Source. Mine was lost i a wildfire.

40 million facing eviction is already a financial crisis for 40 million people. But I guess their finances don't count?

I believe the fire risk can be mitigated through better building codes. Florida solved this problem years ago. California is just stubborn. Sea level rise I think is much more problematic. Houston has had three "500 year" floods in the past 4 years. Parts of Miami already experience flooding during high tides at certain times of the year. Low lying coastal areas will continue to get hammered. Venice, Italy is another place...

https://tidesandcurrents.noaa.gov/sltrends/sltrends_station....

Sea level rise is not a big problem at all. Above is the tide gauge for Key West (very close to Miami), and it shows a 0.3m or about a 1 foot rise since 1910. That is consistent with millenia long trends, as sea levels have been rising since the beginning of the Holocene ~12K years ago.

The parts of Miami Beach (the island near Miami), are caused by the fact that parts of the island are sinking.

Houston was built at the meeting point of two bayous in the early 1800s and flooded shortly after it's founding. It has experience frequent floods since then. Here's photos of them: https://www.dtn.com/houstons-history-of-floods/

We don't have records on Houston going back 500 years so I don't know where you got the 500 year figure from. Needless to say, the above is proof that floods are very common in former bayous.

Key West is 130 crow fly miles from Miami. 160 by car.

Yes, and sea level is driven by changes thousands of miles further, including ice volume at the polar caps, undersea currents, lunar gravitational pull, etc. 130 miles, when we're talking about sea level, is nothing. And these trends are true across the globe. Sea level has only been rising at the rate of 1 foot per century. And that rate has been pretty steady for thousands of years (it didn't start at the beginning of the industrial era).

> And that rate has been pretty steady for thousands of years

Sorry, no, it hasn't. Sea level has been within 10cm of 1900's levels for at least a thousand years.

https://www.sealevels.org/

https://skepticalscience.com//Past-150000-Years-of-Sea-Level...

The only thing in this aerial view of Houston (before flying machines) is a flood plain:

https://en.wikipedia.org/wiki/File:Old_map-Houston-1873.jpg

Where Houston was founded as a real estate venture to be the new center of government, business & industry for a newly independent nation, the land had been shaped by thousands of years of occasional overflow of these narrow bayous by miles beyond their normal banks. As the water from events like Hurricane Harvey always accumulates from all the upstream watersheds at this low point before moseying into the bay and the gulf.

Or as a hurricane making a direct hit pushes the storm surge up the bay so the low point is not so low by comparison, and lesser rain than Harvey can be just as bad for some people.

The purpose of Houston is to sell false estate (a flood plain) as if it was real estate, so a bigger fool has always been necessary.

The 100-year and 500-year flood probabilities were likely gamed since the first flood of Houston. The capital moved upstream ending up in Austin. 100-year means one chance in 100 each year, if you're above the 500-year line it means you only have one chance in 500 every year.

Note; where the big buildings were then is about where the big ones downtown are now.

TLDR: We are going to have a housing crisis because climate change. That should give you an idea as to how seriously you should take this article.

We are going to have a housing crisis and more because of climate change and people moving from places where temperatures are unbearable and the weather is more unstable.

There are lots of articles if you want to read more, for example: https://www.sciencenewsforstudents.org/article/climate-chang...

Feel free to post a link to one concrete case of mass migration due to human climate change from temperatures or rising sea levels. Not ambiguous cases like the hurricane in your link but actual relatively demonstrable cases of direct temperature rises or sea level rises from climate change caused by humans. So far, a lot of frantic hand waving and heady speculation aside, I know of none.

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