I warned you about this three years ago, in an article about the redlining of big sections of Louisiana after multiple years of century storms. We lose insurance and we lose capitalism. And it’s already started. The insurance industry is totally hosed over all the disaster warming has caused. From massive floods followed by ‘flash droughts’ and an early snow, the croplands of the American midwest have taken a huge hit this year.
CBS broke the news here .the phrase that pays (from the article): The housing market doesn’t yet factor in the risk of climate change, which is already affecting many areas of the U.S., including flood-prone coastal communities, agricultural regions and parts of the country vulnerable to wildfires. In California, for instance, 50,000 homeowners can’t get property or casualty insurance because of the increased risk to their homes.
Yet for now, no mortgage lender, portfolio manager or buyer of mortgages takes into account climate-induced floods, except to determine if a house sits in a 100-year floodplain at the time the mortgage is issued, said Michael Berman, a former official with the U.S. Department of Housing and Urban Development and former chairman of the Mortgage Bankers Association.
The implication is clear–once you can’t insure property, who can buy it with cash? Kiss home mortgages goodbye. Kiss the one sure thing the boomers have–the deed to the house, mortgage paid off–and it’s all over.
My friend Kevin Hester wrote all this up a few weeks ago. you can read his roundup of such news at his website. But his sum-up of the situation is pretty direct: Clearly the cost of disasters is on the same Hockey Stick trajectory as our climate crisis yet “Business as Usual” carries on as if nothing has changed. All Ponzi schemes eventually implode and this one will be no different except in scale. There is no previous analogue to remotely compare with the coming collapse.