#emerging risks

[thetaxguyin]

ICAI's Guidance Note on Audit of Banks (2024 Edition)

The Institute of Chartered Accountants of India (ICAI) stands at the forefront of shaping the accounting profession, providing guidance and standards to ensure excellence and integrity in financial practices. as usual on February 14, 2024, ICAI issued the latest edition of its Guidance Note on Audit of Banks, offering comprehensive insights and directives for auditors navigating the complex…

[mostlysignssomeportents]

Insurance companies are making climate risk worse

Tomorrow (November 29), I'm at NYC's Strand Books with my novel The Lost Cause, a solarpunk tale of hope and danger that Rebecca Solnit called "completely delightful."

Conservatives may deride the "reality-based community" as a drag on progress and commercial expansion, but even the most noxious pump-and-dump capitalism is supposed to remain tethered to reality by two unbreakable fetters: auditing and insurance:

https://en.wikipedia.org/wiki/Reality-based_community

No matter how much you value profit over ethics or human thriving, you still need honest books – even if you never show those books to the taxman or the marks. Even an outright scammer needs to know what's coming in and what's going out so they don't get caught in a liquidity trap (that is, "broke"), or overleveraged ("broke," again) exposed to market changes (you guessed it: "broke").

Unfortunately for capitalism, auditing is on its deathbed. The market is sewn up by the wildly corrupt and conflicted Big Four accounting firms that are the very definition of too big to fail/too big to jail. They keep cooking books on behalf of management to the detriment of investors. These double-entry fabrications conceal rot in giant, structurally important firms until they implode spectacularly and suddenly, leaving workers, suppliers, customers and investors in a state of utter higgeldy-piggeldy:

https://pluralistic.net/2022/11/29/great-andersens-ghost/#mene-mene-bezzle

In helping corporations defraud institutional investors, auditors are facilitating mass scale millionaire-on-billionaire violence, and while that may seem like the kind of fight where you're happy to see either party lose, there are inevitably a lot of noncombatants in the blast radius. Since the Enron collapse, the entire accounting sector has turned to quicksand, which is a big deal, given that it's what industrial capitalism's foundations are anchored to. There's a reason my last novel was a thriller about forensic accounting and Big Tech:

https://us.macmillan.com/books/9781250865847/red-team-blues

But accounting isn't the only bedrock that's been reduced to slurry here in capitalism's end-times. The insurance sector is meant to be an unshakably rational enterprise, imposing discipline on the rest of the economy. Sure, your company can do something stupid and reckless, but the insurance bill will be stonking, sufficient to consume the expected additional profits.

But the crash of 2008 made it clear that the largest insurance companies in the world were capable of the same wishful thinking, motivated reasoning, and short-termism that they were supposed to prevent in every other business. Without AIG – one of the largest insurers in the world – there would have been no Great Financial Crisis. The company knowingly underwrote hundreds of billions of dollars in junk bonds dressed up as AAA debt, and required a $180b bailout.

Still, many of us have nursed an ember of hope that the insurance sector would spur Big Finance and its pocket governments into taking the climate emergency seriously. When rising seas and wildfires and zoonotic plagues and famines and rolling refugee crises make cities, businesses, and homes uninsurable risks, then insurers will stop writing policies and the doom will become undeniable. Money talks, bullshit walks.

But while insurers have begun to withdraw from the most climate-endangered places (or crank up premiums), the net effect is to decrease climate resilience and increase risk, creating a "climate risk doom loop" that Advait Arun lays out brilliantly for Phenomenal World:

https://www.phenomenalworld.org/analysis/the-doom-loop/

Part of the problem is political: as people move into high-risk areas (flood-prone coastal cities, fire-threatened urban-wildlife interfaces), politicians are pulling out all the stops to keep insurers from disinvesting in these high-risk zones. They're loosening insurance regs, subsidizing policies, and imposing "disaster risk fees" on everyone in the region.

But the insurance companies themselves are simply not responding aggressively enough to the rising risk. Climate risk is correlated, after all: when everyone in a region is at flood risk, then everyone will be making a claim on the insurance company when the waters come. The insurance trick of spreading risk only works if the risks to everyone in that spread aren't correlated.

Perversely, insurance companies are heavily invested in fossil fuel companies, these being reliable money-spinners where an insurer can park and grow your premiums, on the assumption that most of the people in the risk pool won't file claims at the same time. But those same fossil-fuel assets produce the very correlated risk that could bring down the whole system.

The system is in trouble. US claims from "natural disasters" are topping $100b/year – up from $4.6b in 2000. Home insurance premiums are up (21%!), but it's not enough, especially in drowning Florida and Texas (which is also both roasting and freezing):

https://grist.org/economics/as-climate-risks-mount-the-insurance-safety-net-is-collapsing/

Insurers who put premiums up to cover this new risk run into a paradox: the higher premiums get, the more risk-tolerant customers get. When flood insurance is cheap, lots of homeowners will stump up for it and create a big, uncorrelated risk-pool. When premiums skyrocket, the only people who buy flood policies are homeowners who are dead certain their house is gonna get flooded out and soon. Now you have a risk pool consisting solely of highly correlated, high risk homes. The technical term for this in the insurance trade is: "bad."

But it gets worse: people who decide not to buy policies as prices go up may be doing their own "motivated reasoning" and "mispricing their risk." That is, they may decide, "If I can't afford to move, and I can't afford to sell my house because it's in a flood-zone, and I can't afford insurance, I guess that means I'm going to live here and be uninsured and hope for the best."

This is also bad. The amount of uninsured losses from US climate disaster "dwarfs" insured losses:

https://www.reuters.com/business/environment/hurricanes-floods-bring-120-billion-insurance-losses-2022-2023-01-09/

Here's the doom-loop in a nutshell:

As carbon emissions continue to accumulate, more people are put at risk of climate disaster, while the damages from those disasters intensifies. Vulnerability will drive disinvestment, which in turn exacerbates vulnerability.

Also: the browner and poorer you are, the worse you have it: you are impacted "first and worst":

https://www.climaterealityproject.org/frontline-fenceline-communities

As Arun writes, "Tinkering with insurance markets will not solve their real issues—we must patch the gaping holes in the financial system itself." We have to end the loop that sees the poorest places least insured, and the loss of insurance leading to abandonment by people with money and agency, which zeroes out the budget for climate remediation and resiliency where it is most needed.

The insurance sector is part of the finance industry, and it is disinvesting in climate-endagered places and instead doubling down on its bets on fossil fuels. We can't rely on the insurance sector to discipline other industries by generating "price signals" about the true underlying climate risk. And insurance doesn't just invest in fossil fuels – they're also a major buyer of municipal and state bonds, which means they're part of the "bond vigilante" investors whose decisions constrain the ability of cities to raise and spend money for climate remediation.

When American cities, territories and regions can't float bonds, they historically get taken over and handed to an unelected "control board" who represents distant creditors, not citizens. This is especially true when the people who live in those places are Black or brown – think Puerto Rico or Detroit or Flint. These control board administrators make creditors whole by tearing the people apart.

This is the real doom loop: insurers pull out of poor places threatened by climate disasters. They invest in the fossil fuels that worsen those disasters. They join with bond vigilantes to force disinvestment from infrastructure maintenance and resiliency in those places. Then, the next climate disaster creates more uninsured losses. Lather, rinse, repeat.

Finance and insurance are betting heavily on climate risk modeling – not to avert this crisis, but to ensure that their finances remain intact though it. What's more, it won't work. As climate effects get bigger, they get less predictable – and harder to avoid. The point of insurance is spreading risk, not reducing it. We shouldn't and can't rely on insurance creating price-signals to reduce our climate risk.

But the climate doom-loop can be put in reverse – not by market spending, but by public spending. As Arun writes, we need to create "a global investment architecture that is safe for spending":

https://tanjasail.wordpress.com/2023/10/06/a-world-safe-for-spending/

Public investment in emissions reduction and resiliency can offset climate risk, by reducing future global warming and by making places better prepared to endure the weather and other events that are locked in by past emissions. A just transition will "loosen liquidity constraints on investment in communities made vulnerable by the financial system."

Austerity is a bad investment strategy. Failure to maintain and improve infrastructure doesn't just shift costs into the future, it increases those costs far in excess of any rational discount based on the time value of money. Public institutions should discipline markets, not the other way around. Don't give Wall Street a veto over our climate spending. A National Investment Authority could subordinate markets to human thriving:

https://democracyjournal.org/arguments/industrial-policy-requires-public-not-just-private-equity/

Insurance need not be pitted against human survival. Saving the cities and regions whose bonds are held by insurance companies is good for those companies: "Breaking the climate risk doom loop is the best disaster insurance policy money can buy."

I found Arun's work to be especially bracing because of the book I'm touring now, The Lost Cause, a solarpunk novel set in a world in which vast public investment is being made to address the climate emergency that is everywhere and all at once:

https://us.macmillan.com/books/9781250865939/the-lost-cause

There is something profoundly hopeful about the belief that we can do something about these foreseeable disasters – rather than remaining frozen in place until the disaster is upon us and it's too late. As Rebecca Solnit says, inhabiting this place in your imagination is "Completely delightful. Neither utopian nor dystopian, it portrays life in SoCal in a future woven from our successes (Green New Deal!), failures (climate chaos anyway), and unresolved conflicts (old MAGA dudes). I loved it."

If you'd like an essay-formatted version of this post to read or share, here's a link to it on pluralistic.net, my surveillance-free, ad-free, tracker-free blog:

https://pluralistic.net/2023/11/28/re-re-reinsurance/#useless-price-signals

[zinjanthropusboisei]

Since the wildfire smoke has been hitting the east coast, I've been thinking about doing a flowchart-style infographic on where to find US hazard information - so many of the comments on the info I posted were like "huh. I was wondering why the sky looked so funny." With the state of the Internet, search engines, and social media today, it really isn't intuitive where you can go to find reliable information on something so vague as "I noticed something a lil funky today," and so many of the platforms and accounts that emergency managers have spent years building up trust and visibility for have disappeared or become unverifiable because of Twitter's meltdown. Best to go to straight to the source when you can, as long as you know where to start.

This would just focus on the federal government, and mainly on immediate warnings and alert information...I'd rather just focus on natural hazards as well since those are the resources I'm familiar with, but that might be too narrow. Any ideas for questions and flowpaths besides what I've sketched out so far are welcome!

[hobbinch]

After 4 years I fucking tested positive for covid. I must have got it on the plane despite all my precautions, or from a passerby while my mask wasn't a perfect fit. I'm so bummed and also stressed and worried i gave it to jays elderly, ailing father. Fuck fuck fuck fuck.

[jh-arts]

Summer of 51’s Day 1: Risk Assessment

I used to see these signs while driving through the mountains, and honestly, who isn’t always thinking of Johnny’s Smokey the Bear poster? 😌

Honestly not sure if this makes any sense for the prompt but it’s what came to mind for it. Also i will be posting these prompts alternating between my other account and this one depending on how much i like them tbh. Background image credits!!

[elbiotipo]

I'm covered virtually head to toe, shoes, pants, a hoodie, everything, because of cold and dengue and a fucking mosquito bites me in my thumb. God.

[dreamlogic]

aahhhuuueeeghhh the other night E was like "you wanna hear something soggy as hell?" before dropping thee most deeply loving sentiment i've received in a looooong time.

[housediva]

A Matter of Trust (Emergency!)

Roy has to make a life or death decision and has trouble living with his choice.

[justarabidlittleyingzhao]

Every fandom gets a middle age. It's not defined by time. It's defined by the emergence of fics and art that explore hugely divergent What Ifs.

It's a growing rejection of the ironclad This Is How xyz Character Is, and a desire to explore something new. Maybe an idea that was always secretly thought about, but no one was confident enough before to risk.

A fandom's middle age is when there begins to be a shift away from 'But Canon?!' to 'What Canon.'

If a fandom can get through the initial need to keep replicating the same version of Canon (or as is more often the case, Fanon), this middle age often produces more interesting and dynamic and nuanced creations.

[moonblossom]

Where I've been for a week...

This gets graphic about physical injury below the cut, so please don't read if that's something you're not up for right now. TL;DR I fell down the stairs and massively fucked up both my legs.

So last Tuesday, I was working from home as I usually do. I went upstairs to have a coffee and some banana bread my dad made. While up there, I realised I'd forgotten to set my work phone to DND so I hurried up and ran down the stairs to my room where my office is.

Big mistake.

The stairs into my room are varnished wood, awkward heights, and not very well lit. I slipped and missed my footing, which has happened a million times before.

This is where things get unpleasant. Read on with caution.

Somehow, both the tibia and fibula in my right leg snapped in half with enough force to drive them both through the front of my shin.

I was in and out of consciousness, but I do remember being surrounded by what felt like 40 EMTs (was closer to ten according to my folks - three ambulances showed up), one of whom was utterly charmed by my lizard. He looked about twelve. Bless him for distracting me while one of his partners cut open my favourite lounge pants and shoved the bones back inside my leg. I was not wearing underwear at the time.

We get to the Montreal General Hospital in... mediocre time, due to a fuckton of construction and detours. Bienvenue a Montreal, fuck right off.

They put me straight into a trauma unit and pumped me full of fentanyl and antibiotics. I vaguely remember one of the EMTs referring to my pain level as a "fifteen out of ten". They checked my entire body to make sure nothing else was injured, both manual and ultrasound to make sure I still had my spleen and shit. Thankfully, all my innards are still functional. They cut the remaining shreds of my pants off but managed to get my tank top off without too much drama. Someone was kind enough to drape a hospital gown over my boobs and... possibly my crotch? I was in too much pain to give a crap at this point.

They manage to take a few x-rays while I curse them and their ancestors and the hospital and just... the entire fucking world, and then fill me up with some delightful cocktail of propofol and ketamine. I remember very little after this point, but apparently they yanked my leg into place, noticing my right left ankle was severely sprained in the process. So that was fun. Apparently I cursed a bunch more, and made a bunch of jokes that were likely inappropriate but broke the tension I guess?

I "woke up" from the cocktail feeling like I was underwater, and then convinced I was inside Disney Dreamlight Valley, which frankly was a lovely way to come out of sedation. I think I was picking flowers with Mirabel Madrigal.

At some point during all this nonsense my mother managed to get in touch with my boss who was adamant that I take as long as needed, which was a good thing. My dad came to the hospital with me but they wouldn't let him into the trauma unit. It was very chaotic and crowded and likely gross to watch so I get it.

After the realignment, they pushed my gurney to the space between X-Ray and CT to get better scans. They were both occupied so I sat in the hall for a few minutes and vaguely remember saying "Bonjour, hi!" and "Can I help you?" to random people who passed me. Once a retail worker, always a retail worker, apparently.

CT confirmed I also had a broken bone in my left foot. They moved me into ER main, put a boot on the left and bandaged up the wound. I was told I'd need surgery but they were so overwhelmed (ER was like at 160% capacity or something) so they had no idea when I'd be cleared.

They brought me dinner which claimed to be frittata and mashed potatoes but I'm fairly certain was actually upholstery foam and wallpaper paste. Thankfully it was so unappetizing I didn't eat more than a few bites, because my nurse was like "Hey so you're next on the OR list. If they ask if you ate, say no." XD Bless you Meagan, you saved my arse multiple times. You are a sarcastic, foul-mouthed, adorable angel among nurses (and really all the nurses were lovely). About an hour later they wheel me up to the ER, wash me down as best they can, and start prepping me. I meet the surgeon, who is as brusque and no-nonsense as orthopedic surgeons tend to be, but he did take the time to explain the whole procedure and risks, and make sure I was comfortable and understood.

What they were gonna do was drill down through my knee and insert a titanium rod down the centre of the entire tibia. The fibula was close enough and a clean enough break that it could rely on the tibia's stabilisation. Fun note about this particular surgery - you can walk on it within days of it being installed. No cast or anything!

The anaesthetist suggested a sedative and a spinal block (similar to an epidural) rather than a full unconscious anaesthetic because of my medical history and they're just generally less dangerous. However, it turns out the sheath around my synovial spaces in my spine is made out of fucking Kevlar or something. They bent SEVEN NEEDLES trying to get a shot in. Took about 45 minutes. I was numb so it was nbd but it was like... ten PM at this point and everyone was tired so when the anaesthetist was like "I think we should do a general" I was like "sign me the fuck up where's the consent form" I woke up a few hours later in the PACU (post-anaesthetic care unit) with a titanium upgrade, 37 staples in four separate locations, an incredibly fashionable thigh-high bandage, and my mother at my side. I faded in and out for about an hour and then remember being in a tiny little private room with its own bathroom. A total luxury in our older hospitals (The MGH as an institution has been around since the 1800s and the building I was in was built in 1955 - the bathroom even had adorable black and white tiling typical of the bathrooms of that era). That's pretty much all the dramatic bits of the story. They kept me for a week working with nurses, orthopedic residents, and physiotherapists until they were comfortable enough that I could move around enough at home to attend to my basic needs. I have crutches, a walker, a rolling commode so I can do the needful literally a foot from my med, a desk that slides over my bed, and thankfully two incredibly patient and indulgent parents. I'm fairly certain they never expected to be cleaning their 42 year old daughter's poop out of a bucket, but what can you do?

If anyone is genuinely curious, I have photos and would be willing to write up the hospital stay itself but 90% of it will be me complaining about the other patients on the ward who screamed at the nurses for everything and if I'd been able to walk I would have smothered with a pillow, or the "food" they tried to feed me which got increasingly inedible as the week went on.

If you've read this far, bless you. If you leave a note or message me I'll do my best to reply but I'm floating in and out of a dilaudid-infused haze so it might be a while.

At this point I'm not too proud (or possibly I've just lost whatever shame I had left when they cut my pants off), if you feel like sending me a get-well gift my amazon wishlists are here: general wishes | https://www.amazon.ca/hz/wishlist/ls/1K85M74WULR1N?ref_=wl_share

craft supplies | https://www.amazon.ca/hz/wishlist/ls/PXBKTW4UK0AQ?ref_=wl_share

US wishlist | https://www.amazon.com/hz/wishlist/ls/2MT3KS1ZDZG0O?ref_=wl_share

(stuff will be delivered to my boyfriend and I'll open it whenever I'm allowed to fly down there)

[crimeronan]

There would be a whole culture of video essays around what influencer nova is up to This Time I think

there's something really compelling to me about sol being an hbomberguy-style journalist-sleuth-influencer who is constantly making in-depth videos exposing nova's shit, except there's a dedicated portion of her fanbase who quickly get new people up to speed on "listen. this actually is all factual good work. but you must understand that at the end she is Going to promote a crypto pump-and-dump scheme. do not buy into the crypto pump-and-dump scheme"

[sesamenom-misc]

brief survey

*common symptoms include:

physiological - lingering chest pain, shortness of breath, lingering cough, heart palpitations, abnormal heart rate

neurological - brain fog, general cognitive decline, fatigue, language/word retrieval issues, short term and long term memory issues, abnormal executive dysfunction, difficulty concentrating, exacerbation of pre-existing depression or anxiety

**if you first contracted covid before vaccines were available, you can count it as unvaccinated

[rowanthestrange]

You ever heard of ‘second childing’? That thing where for your first child you read all the books, you hyperfocus on every little thing, plan out their life and time, and rush them to the doctor if they hiccup; but for your second child you just watch casually as Jessica ricochets off the coffee table and you’re like…‘eh, they’re fine’.

Second Childing this puppy hard. Are we fully puppy proofed? Beh, it’s safe. Sure the ground level food cabinet door hasn’t been reattached yet and we’re gonna see him wander in with a packet of instant noodles at some point, but whatever.

[pyjamaenzel]

...watching the whole mask debate go down was incredibly surreal bc I learned about using masks to prevent transmission of other resp. diseases before covid happened. I got a nasty bug once (coughing, sneezing, the works) & wore medical masks at home for the duration & my partner did not catch it despite us living in a tiny 1 br apartment. Recently did a 4 hr drive w/ someone who was sick (not covid), sneezing and coughing and refused to mask 🙃 but I was wearing one and...didn't catch it.

...so all the people whining that "they don't work" and accusing others of being sheep was absurd in the face of actual concrete evidence.

(that's before you get into why surgeons & dentists are required to wear em like. this is not for no reason. lmao)

(also frequent handwashing. I take public transit & wash hands immediately on getting to my destination. I used to get sick several times a year & have been sick once since 2020)

[boytoyfaun]

Healthcare in this country sucks so bad. If you are feeling generous or have enjoyed my content, please consider helping me pay for an upcoming diagnostic test that my insurance won't cover.

I'm saving as much as I can but I'll still be $600 short by the time of the appointment in March, if my budget is correct.

Any amount to $boytoyfaun or buymeacoffee gets you custom content. I'm kink friendly and never judge. If you have qs about my situation or what kind of content I'll do, please send me a message!

$207/600