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Australia’s Fires May Cause Record-Setting Damage to Its Economy

Source: Fire Information for Resource Management System, NASA

A NASA project using satellite imagery shows “near real-time active fire data.” This image captures active fires between December 5, 2019, and January 5, 2020: Each pixel represents 1 kilometer, and contains at least one active fire. 

While some sources estimate the damage to be around $280 million, the Insurance Council of Australia estimates “damage claims from the fires to [be] more than AU$700 million [$480 million], with claims expected to jump when more fire-hit areas are accessible,” according to Reuters, which adds that “insurers have received 8,985 bushfire-related claims since November 8.” 

The economic damage on Australia’s eastern seaboard is “likely to exceed the record $4.4 billion set by 2009’s Black Saturday blazes,” according to economist Katrina Ell in The Guardian. Air pollution and “direct harm to industries such as farming and tourism,” will significantly damage the economy, the article cites, with “tourism bodies say[ing] it will cost hundreds of millions of dollars to rebuild.”

The Greatest Risks for 2022 and Beyond

The health of our planet and societies are the biggest concerns for global risk experts, according to the 2022 Global Risk Report. The most consequential point may be that each of these categories is not mutually exclusive — all of them either balance or exacerbate the risks of the other. 

For example, climate change, measurably accelerated by human activity, has led to biodiversity loss, or the “depletion of the varied forms of life on Earth.” This, in turn, impacts our ability to stay healthy: “Exposure to a diverse range of microbes allows our bodies to mount an effective defensive response against pathogens,” according to ecologist Jake Robinson. 

The declining health of our planet and people can then fracture social cohesion, another highly ranked concern from the report’s survey respondents. We’ve seen social cohesion weaken both physically, as we experienced lockdowns over the last two years, and mentally and emotionally, in terms of the political dimension of COVID-19 and the pandemic’s impact on mental health. The intersectionality of the risks means that efforts to mitigate them need to be considered holistically — and that improvements in one area can positively impact another. 

Pandemic and Trump Bump for Media Faded In 2021

The news industry is in dire straits, according to a recently published analysis by Axios. Comparing performance for 2021 to the year prior, top news companies saw a decrease of 65% of social media interactions and a 33% decrease in app downloads. Cable news primetime viewers, similarly, fell by 36%.

Furthermore, unique visits to the top five websites fell 8%. An earlier report by Axios pointed to some publishers seeing as much as a 43% decrease in traffic in the first half of 2021.

The decrease in traffic coincided with the inauguration of President Joe Biden, who intended to be a “no drama” president. As vaccines were deployed, the reopening of the economy meant less focus on COVID-19, which drove a lot of the engagement in 2020. The decrease in engagement also comes as alternative media formats, such as podcasts, continue to increase in popularity, leading to a fragmentation of attention.

NOAA Forecast Shows Dire Situation for Great Barrier Reef

The Great Barrier Reef in Australia could face a mass bleaching event at the end of January according to reports from the U.S. National Oceanic and Atmospheric Administration. Water temperatures are currently above average throughout the reef, with some areas 35.6 degrees Fahrenheit (2 degrees Celsius) higher. 

“When water is too warm,” says NOAA, “corals will expel the algae … living in their tissues causing the coral to turn completely white.” Bleaching does not kill the coral, but if exposed to warmer-than-average water temperatures for too long, coral will eventually die out, putting the biodiversity of the ocean at risk. 

Although 2021 was a year of recovery for global reefs due to relatively lower ocean temperatures and lack of cyclones, this warning by NOAA comes just two years after a mass bleaching event occurred in 2020. According to a recently released report, 98% of the Great Barrier Reef has experienced bleaching since 1998. To anticipate the inevitable effects of climate change, scientists are working on breeding resilient types of coral, with the intent of introducing them to affected areas.

 

ESG Stocks Contribute to Greenhouse Gas Emissions

Popular ESG stocks often contribute toward greenhouse emissions, according to an analysis by Jordan Waldrep, chief investment officer of Illinois-based TrueMark Investments. Although ESG stocks exclude most oil and gas companies, emissions data from companies paint a different picture.

According to Waldrep, many exchange traded funds include companies that emit more greenhouse gases than a hypothetical fund that excludes the five dirtiest companies per sector. The problem, according to Waldrep, is that the funds weigh other ESG priorities higher than environmental impact.

Further complicating the scenario is the lack of visibility in supply chain emissions. An analysis of popular ESG stock Amazon, for instance, showed that its ocean shipments and third-party sellers cannot be tracked.

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