Disaster capitalism - How financial markets benefit from the climate problem | DW Documentary

[Music] [Music] in the old days say uh pre1 1990s uh Capital was king or queen you called the shots now capital is a burden I estimate that globally there's roughly 10 to 20 trillion in excess Capital that has no useful home no place to [Music] go it's it's just roaming the world searching for a a use for those who possess that Capital uh it's it's a little bit of a nightmare so it can kind of make up its own opportunities or it can allow crazy Financial opportunities to arise solely to put that

money to [Music] work there is a world made up of numbers a world where you have to be the smartest or the fastest a world connected by radio waves and Fiber Optic [Music] Cables a world where you can make money if you think you know what the future holds a world of fear and [Music] desire where you can win or lose I call this world Planet Finance wandering around Planet Finance I arrive at a place where they really love risk here they speculate on the chance of a wildfire flood or other catast

rophe happening you want to try go from there come on boys let's go this man lives of disasters I married while I was in college and I started my family while I was doing my PhD my my first child he cost the insurance company half a million dollars uh being born prematurely and so the person at the insurance company told me your next child won't be covered oh so good someone whispered to me and they said hey go to Wall Street um you know a lot of math they'll give you health care just for solvin

g one equation okay so in the first interview the person comes in he said John uh does money motivate you and he went on and on a 10 or 15 minute speech that culminated almost do you worship at the altar of money does money mean more to you than anything else on this planet Etc so I was like wow this is a very long speech so waited for him to finish and I said no now see then why are you here I said oh I just need health insurance and I'll do anything that you ask me to do that was my start and

that led directly and eventually to my getting a phone call from Leeman Brothers one day for catastrophe bonds I said oh wow I go okay so I have no experience in that and he said that's the great thing nobody does on planet Finance there is a market for nearly everything even for a future disaster a disaster that hasn't happened yet a disaster that might never happen there are people who spend all their time calculating the minimum chance of such a disaster happening and above all the extent of

the [Music] damage what is a crisis or a catastrophe or a hurricane what happens is it Causes Chaos and chaos is the breakdown of typical [Music] systems and it's this feeling of you normally walk around you're like I know the subway is going to come at this time I know that I have to go to work at 9:00 I have to leave by five and to go to the grocery store and then a crisis hits and none of that is known anymore suddenly it's all in the world of unknown to show you how such a chaotic situation

can give rise to a market I will take you back to a dark Autumn night come here sh Hurricane Sandy reaches the shores of New York a state of emergency is declared and all traffic comes to a standstill the South part of Manhattan is flooded and power goes out the next morning the extent of the damage becomes clear and even Wall Street is forced to close trading for two days a rarity the last time that happened was after to 911 the aftermath is a process of how do you go from chaos back to underst

anding or back to some sort of stability it's not going to be the same as it was before but hopefully a little bit more stable than than uh than that moment of Chaos the storm leaves New York with 43 dead and billions of dollars of damage the flooded tunnels are the greatest disaster to ever happen to the city's public transportation system be careful CU you want to have some grease in it so might be a little sppy so how do you make a business out of that what what is the business well the busin

ess is being able to predict that risk and price it how can anyone make money out of a disaster a disaster that only seems to leave losers in its wake the tunnel filled with water for about 2/3 of its length we estimate there were about 60 million gallons of salt water entered the tunnel I think it was about a week of solid pumping just to just to pump the water out of the tunnel that was before we started doing any repairs or cleaning or anything like that I don't think anybody anybody knew wha

t the intensity of it was going to be when it actually came and you know we weren't weren't really prepared for it I guess today New York is prepared to be able to pay for the damage when the next hurricane happens a former Banker has found the solution she spent years on Wall Street and now works for the Transportation Authority of New York for the uninsurable damage she goes to Planet Finance for help we're all here about hurricanes in the Caribbean we know about damage in Florida occasionally

and we never thought that it would come here but it did of course our system was devastated the inside of our tunnels um have a lot of electrical um equipment that was all um [Music] ruined our um damages were like in about $800 million range I think we were only able to get about 500 million give or take in coverage and the premium doubled actually more than than doubled so we were concerned that we were not able to get enough coverage that's when we started working on our first cat Bond trans

action let's explain that one first cat bond is short for catastrophe Bond a bond is nothing more than a loan that has to be paid back before a specified date I lend you a sum of money you pay me interest and at the end of the term you pay me back the borrowed amount but a cat Bond goes further than that if a disaster occurs before the end of the loan's term the money lender loses the entire sum which is then used to compensate for the damage and save New York it's it's exactly like insurance ri

ght Insurance collects your premium while everything's okay it's supposed to pay you when you have been and loss so now New York pays interest on a cat Bond instead of an insurance premium and if you want to buy a cat Bond you go to John so I described the deal and I fairly quickly got to the size it's say oh nothing just 500 million you know years ago Jon couldn't get health insurance when his wife was expecting a second baby now he owns a hedge fund specialized in cat bonds the hedge fund ther

e is losing leaving 400 basis points on the table right that's why it's like cuz we're not cat bonds that should cover the damage of future disasters reasoning is that there are all these opportunities and you just have to give examples like I gave right but as I say to get in on the game you need at least € 100 million hold on a second this is a billion and a half commercial mortgage that's backed by the collateral of the building itself the complex and the the complex itself is not insured aga

inst earthquake or flood even or all these cat there are even cat bonds to cover the damage of solar storms and meteorite impacts so this is uh our main room we're 31 people and uh we invest in bonds now bonds are usually very simple uh these bonds are called catastrophe bonds meaning earthquakes hurricanes floods we lose money when they occur so uh we're not profiting off a destruction we're ensuring uh destruction uh that is otherwise too large for traditional insurance companies to handle com

fortably so there's a a lot of computation that's involved in this this server room is the heart of the company the computers link the widest range of data sets together and continuously calculate the probability of a future disaster happening plus the damage it might because um it's set up so that my older brother who used to sit right over there can actually see all the status lights from his desk so it turns out running a server room is very complex because you have software to see if softwar

e is broken but then you need software to look at that software to see if it's broken and usually the the the whole chain doesn't work all the time so the best uh indicator of failure is actually a red light so you want to be able to stand up and see the red light [Music] investors uh around the world are looking for something new to invest their money in uh and then they find us once they find us and allow us to invest uh their money then then the really the rest is relatively easy I up my hey

hello right are we on that 10 to 20 trillion dollar of capital roaming the world is urgently looking for returns our clients are wonderful they they come from every continent from every investor class uh in in the world uh so it's everything from uh giant National Pension funds corporate Pension funds Sovereign wealth funds uh insurance companies Banks endowments charities uh and and Wealthy individuals what would happen if normal the traditional bonds witness higher yields how would it affect t

he cat bonds you know our our Market is if the interest rates on other bonds go up as they do today the interest rates on cat bonds automatically go up as well so the returns remain high you know in a sense catastrophe bonds are the only thing left over to absorb that extra risk the the demand for cyber risk coverage is going to explode over the next year Jon so's clients invest millions in his hedge fund and throughout the term of the cat Bond they receive an attractive interest rate in return

but first the conditions under which they can lose their money are precisely defined there are so-called triggers for that what the minimum damage should be after a wildfire or what the the minimum water level should be during a flood the trigger was created specifically for our area basically the modeling firm did the analysis where potential storms can come from and they analyze about 100 Years of data they model 100,000 storms based on all this data available historically and basically they'r

e continuously measuring water levels the triggers are in if in area a the trigger level the water hits 7.75 ft or in area B it hits 12.75 ft above nava8 then transaction triggers another condition for the transaction to trigger is that there's got to be an aimed storm every new hurricane season the first tropical storm gets a name starting with the letter A until the end of the alphabet is reached Anna Bill claudet Dany many named storms have swept across New York since but the water never reac

hed as high as it did during [Music] Sandy it it actually never triggered so so far investors didn't lose any money on us we hope it is going to happen at some point I'm I'm joking but um yeah so so far so good um um so far it hasn't triggered we we didn't have another Sandy so this cat bond is not only a solution for New York but Planet Finance is happy as well a typical winwin situation a catastrophe Bond it's brilliant because it's so simple uh there was no complexity for the investors you kn

ow when you when you set a high uh water mark there and you tell very clearly to the organization if the water comes to 8 ft not 8 and 1/2 ft then we have no insurance then the engineers know how high to make the sandbags to design all the flood barriers for all the entrances to so one of the the mitigation measures that we put into place after Sandy was these floodgates right here these are steel hinged flood gate each of these Gates weighs approximately um more than 40,000 lb so approximately

20,000 kg this Floodgate seemed to be the the best combination of cost strength as long as we maintain them and replace the gaskets these should last for 7,500 years John's job is to make sure that even if there is a big storm there is no damage to his tunnel our tunnel I should say right so my job is to make sure that if there is damage we have money to fix it right investors who invest in CAD bonds they just used to investing in this kind of risk that's what they do and to be honest because it

's such a risky asset right um they enjoy much higher interest rates that are currently available on other assets you know they will invest a little little bit in MTA CAD Bond and then unless a little bit in the earthquake in Mexico cat Bond and a little bit in Japanese typhoon CAD Bond and this is how they diversify their portfolio so things don't hit all at once and they don't lose everything but so there is a market for disasters all around the world each with its own risk and therefore its o

wn price managing catastrophe risk is is very very particular and this was originally what drove my perception of the opportunity here the opportunity not just for profit but actually create a whole another industry that never existed before it was driven by the fact that traditional Finance actually uh is very uncomfortable dealing with catastrophe risk and effectively sweeps it under the rug right they want to think about the opposite which is you know uh the winning lottery ticket hitting it

big you know big upside who wants to think about downside so the very first task I set myself to even before I went to Leman Brothers to manage a catastrophe uh Trading Group was to actually redevelop all the mathematics outside of the bell curve right so there it is the bell curve a graph in the shape of a church bell traditional Banks and insurance companies use the bell curve to calculate their risk in the middle you see what is most likely to happen for instance the chance of people paying o

ff their mortgage the sides of the curve show you the chance of what is less likely to happen like mortgages that aren't paid off due to unemployment or illness the business model of Planet Finance is built on the most likely risks not on the so-called tail risk that's where it becomes much harder to make precise predictions because because what are the chances of an airplane flying into the World Trade Center or of a tsunami crashing straight into a nuclear power plant these are the unexpected

events the traditional part of Planet Finance isn't prepared for but John so lives off these fickle chances the reason why they're stuck on that framework is because they don't have anything else and it terrifies them because if you can't rely on that uh there is actually no academic framework for dealing with systemic uh catastrophe risks CU if you don't have that framework then you can only deal with emotion or relying on old-fashioned techniques that are that are known not to work and and you

need to break with that if you're going to survive uh in the catastrophe Bond [Music] Arena so Jon so's algorithms can be used to calculate the chance of a disaster happening but to me human behavior seems much harder to capture in an algorithm because uh individuals are too wild and wet and non-uniform uh to be conquered with simple mathematics to show you how those Planet Finance algorithms affect planet Earth I travel to the Village of Bonny Dune a close-knit community on the American West C

oast a place where the threat of wildfires looms every long dry summer there's Josh hey hey I he you are you going to be there for a few minutes all right I'll be around the community has a village Elder who lives off the wood from the forest Johnny did you see there's three deer in the orchard his wife who grows flowers for weddings and celebrations the St deer might go up over the road we have to Sho some deer out of the garden uh okay and this man who makes his living drilling water wells I t

hink we're set okay oh you want to get fuel you already got it and a teacher who gives lessons to convicts when one fateful August Night a wildfire came St stra at them they decided to fight it themselves it was the night that marked the beginning of the Santa Cruz lightning complex fires which started with as many as 11,000 bolts of lightning in all the 50 years or more that we've been here we have never seen so much lightning and we thought what is going on but we still uh the fire hadn't real

ly become a reality well it wasn't reality it hadn't started started yet and there happens to be some lightning chain Lightning by the mon B got to check this out we looked out our bedroom window and we had never seen anything like it well it was lighting up the sky everywhere wasn't even in one spot there's the wall of clouds coming towards us Uh something's coming something big something's going thunder clouds humid huge I mean it was behind as it was up north of us it was everywhere there wer

e big lightning bolts going off all over the place and that's why there were nine different fires started you know and the Thunder claps were loud they weren't just you know all way off in the distance they were right on top right around us the fire department well we didn't ever see them to be truthful because they were all going going to these different fire locations I took Nancy our daughter and all the kids and everyone up here vacated and then fire was hitting it was hitting the upper part

of BU who was coming up that SWAT there and starting down this way he get a chunk here it'll drop every human being is constantly making his own personal assessments how to deal with the risks of Life John was up on the mountain by himself his son had left his daughter had left everybody was gone except for John all the neighbors left John was the only one who stayed there was one night when John was the only one up there he's also kind of this uh patriarch of community and and a really well-re

spected Elder I would call him and so I felt the need that I needed to go up just to help John if help was needed and when disaster suddenly strikes you can freeze flee or fight most of us even though we're Hermits just kind of were like okay the government's going to handle it let's get out of the way and then when um John Laman decided to stay uh and you know he let us all know that nobody was here you know it's kind of like that uh age-old story like no one's coming to save you ooh cop don't

know what he's doing here maybe we're all in trouble but we kept getting uh refused by the police um and uh so we ended up sneaking up here I'm so curious about that sheriff we rarely rarely get cops up here just because you know why Patrol we're not super interesting um yeah to to start we'll be uh revisiting some notable wild many miles away John so and his team are trying to calculate bu the possible damage of the wildfires to see if any triggers could be activated the the tubs fire from 2017

campire from 2018 Wy from 2018 and the Santa Cruz Landing fire from 2020 so then let me see here where the where the property counts there the actual property counts are there in line six right you obviously see in green the fire perimeter for the Santa Cruz Fire the CCU fire what what's in green that's the the green is the it's not Forest it's actually the buyer per that's the that's the fire perimeter which I'm I'm going to turn on and off toggle on and off okay and um could you create a diff

erent color for that make it red you know what you see is a bunch of yellow dots and each of those dots represents properties in and around this case the Santa Cruz County we know what resources are we at the very beginning of that event we tested a uh a new satellite imagery processing technique to try to predict what the the losses of that fire would be but would you say the burn ratio in those areas total number of structures versus you know it will be quite High it'll be high yes yeah so tha

t's what it would be interesting to find out because now you're basically coming up with a a resource kind of uh dependent view on what the burn ratio is going to be yeah which I like wildfires are very common and they are relatively straightforward events you have ignition you have burn and then you have damage Dage so where most people actually think that the greatest uncertainty lies is in the damage itself right if you if you burn a certain area then how many of the homes are destroyed and t

here is some uncertainty in there but there's surprising patterns in that maybe those patterns can be recognized in the data but I wonder what good those calculations are to you when the fire is coming your way no one knew how bad it would get all night long I would go up to the top of our property and during the night I kept hearing these explosions that I thought were the propane tanks I mean it was a boom you know Ash was falling on me but it was still tiny breeze on the back of my neck the t

he little breeze was actually blowing the fire slightly away from us in the morning it came over the Ridge and then I could see trees flaring up um I was walking around and I guess partially because my daughter was emotionally um I guess she was tweeting and calling people telling them to get me out of here it was a very surreal experience rodents uh mice and rats literally like running through your legs just fleeing the fire and then the um butterflies a lot of Monarch butterflies were just the

y were just landing on me in the woods and they didn't seem I mean how can you read a butterfly's uh personality but they didn't seem panicked you know the way a butterfly is just so light in the way they live it seems like and so they're just kind of cruising along and they would land and then they would move on but there was a lot more than I have ever seen in the woods and obviously they were just moving away from the danger they don't have necessarily decent roads coming in going out calfire

won't be able to reach there so the burn ratio is going to be 60% should yeah [Music] [Applause] right the fire was finally starting to come around and approach [Music] us anybody that knows how to go towards the Empire no I don't no I think I realized probably on the second day of fighting the fire that we were going to control it as long as the weather didn't change the information was so poor from social media under their iPhones they were seeing pictures of that very aggressive fire and so

from social media there was these satellite images that showed what they said were hot spots of where it was burning and where it wasn't so you would you was kind of an overlay of the Topography of the land and it just had a bunch of dots the red dots where it was really hot orange wasn't as hot yellow maybe it had already burned and then green was okay and when you looked at it it showed red dots all over our house and all over our neighborhood people were hyperfocused on this image and they're

just like it's burning right here and then we would get texts from them say from people in town saying it's burning on back Ranch Road you need to go check it out you need to get out that's your only way out and we go out to back Ranch Road there was no fire and we say there's no way it's burning on background so we can see the fire it's right here you know and then we would tell them and then no it's burning on Warren Drive you need to go get out and then we'd go look and be like no it's not b

urning there either and it wasn't until I think probably 3 or 4 days in we realized that the satellite damage was transposed improperly it needed to shift East by about a mile or [Music] so the fire went around I came up the backside and all of a sudden we got a de A desperate hollering there was a draw there it had come up and it caught one of his out buildings on fire by the time I got up there it had taken off it was really burning we were going to stop and it literally sounded like some Jeet

plane preparing to take off and that's when I decided you know this is ridiculous let's get the bulldozers and we push this fire break through and with those bulldozers the Bonny Dune residents create a wall a fire break between themselves and the approaching Flames it almost looks like that upper left lobe yeah like it go to the left there yeah that lobe right there that looks like they were the ones that actually successfully built a perimeter so I'm going to I'm going to zoom in on that and

actually see if I can see uh the and then the human behavior is a fundamental part of the modeling it's actually already taking into account that there's millions of sometimes very stubborn and independent especially here in the US uh homeowners who are defying orders to leave and evacuate are running around you know putting up boards over their windows and defending their homes if it weren't for that behavior uh then the losses would easily be double or triple what we're observing so it's actua

lly in a sense priced in this human behavior right so John so has already factored in this behavior of large groups of people but what about the behavior of a single individual because whether our village Elder can be insured against wildfires is De decided today by algorithms in New York a finch startup is confident that it can calculate the risk of a wildfire down to the smallest detail and therefore determine whether something is insurable or not and the first version of our model didn't real

ly take into account the randomness of lightning so it didn't really consider lightning as as a as a major variable um so the reason we exist is because the old way of doing things is isn't really working anymore that's the traditional way of understanding risk is let's look at this spot on the map this ZIP code and we look and say okay over the last uh 500 years this has burned five times so it has a one inone 100 chance of burning and then you price it accordingly the problem is it's right the

re in the word climate changed see right here negative4 is Extreme drought right negative3 is a so you can't really use the last 500 years and expect to be able to predict the next 10 years off of that you have to do a much more bottomup physical model uh using machine learning looking at the reality of that place now this is what the trees look like this is this is what the weather looks like this is uh where the fire brakes are this is how close the closest fire engines are and all that's bein

g done by the the model the AI model so it's to give you an idea the traditional way of doing it they might run a 100,000 simulations to get to that one and 100 number they might say run 100,000 different simulations and say okay I I think that this has a one in 100 chance of burning we're our machine learning models our mod models they're running 682 billion simulations to build a well functioning AI model out of 682 billion simulations you need all kinds of things I'm losing money I don't know

how to model this anymore the models aren't working I'm going to leave I'm just I'm not going to do this anymore first of all you need investors's money where else can you go with but also brains with a background on Wall Street and I started my career at Comm Sachs and and I'm a doctor as well a climate scientist a mathematician a probability that the fire will spread to a greed in California and the founders who zealously promote their AI model there is significant Alpha that we could find in

the industry as we've seen as they all pull back because they say all right we have no idea what the future's going to look like there's a far more measured and datadriven approach that that we could really take towards it yeah a lot of the traditional finances so places like Pension funds and hedge funds and and family offices looked over and said well here's this whole world that that's writing insurance policies it's not focused at all on the stock market or or you know in Commodities or som

ething like that they're just focused on whether or not a hurricane happens an earthquake happens or you know Wildfire happens and why that's so valuable is because it's a non-correlated asset and what I mean by that is the stock market can be doing whatever it is today that's almost completely unrelated to whether or not the wind is blowing in Florida and there's a hurricane happening and one of the best things you can have it is an investor is something that's non-correlated because even if yo

u think you're Diversified in your portfolio but it's all in the stock market well if the stock market blows up tomorrow then everything's going to go down so the appeal of a cat bond is that it's a completely different type of risk even if Wall Street crashes tomorrow the cat Bond will still bear High interest rates we're headed out to last chance road to to get people water um we work on work on water wells and uh repairing water wells virtually every water well out here melted fire came throu

gh there uh very fast and very hot very different than the than the fire that we did dealt with at our home sorry for the dirty windshield it's only going to get dirtier today it used to be you couldn't see any of this this this was all trees that was a house there there was a house right here that one survived [Music] one gentleman died out [Music] here he was an elderly guy who went back in to get stuff from what I heard and he didn't make it out he tried to hike out through the state park and

he didn't make it they found him some some of the neighbors found [Music] him after the disaster there is nothing of value left but when lightning strikes a bone dry forest or when a hurricane is on its way to the coast and the extent of the insured damage isn't clear yet that's when Jon so swings into action whether it's a a hurricane wildfires or an earthquake that just happens in the middle of the night I get a phone call and I'm woken up we have software and tools in which we bring up our p

ortfolio and immediately access the impact to the portfolio from the event so um if I zoom in if it looks like a trigger is activated and as an investor you could lose all your money then you naturally want to get rid of your cat Bond as soon as possible by putting it up for sale that's when interesting opportunities arise if you're not able to estimate the the losses of of a live event like this then you have to question your ability to estimate the risks hypothetical risks to this Bond and pri

cing it so it's a it's a little bit like a Formula One race worldwide very few players have the knowledge computing power and reaction speed necessary to play the game LEL just before the fire and then as soon as possible I wonder whether that would be it a typical uh catastrophe bomb portfolio will have roughly 200 positions in it what do you mean uh we'll have 200 different catastrophe Bonds in it these data and so in a major event um roughly 80 to those are potentially exposed to the event th

at narrows it down from 200 to 80 and then um are immediately estimating what the intensity of the event is going to be and and therefore what the financial losses will be and then from that next cut the 80 bonds that are at risk suddenly Narrows down to 10 so that final list of bonds that are potentially at risk the seller really just wants to sell lot of media attention we saw a lot of like a hot potato no one wants to burn their fingers on these cat bonds are now being resold for less and les

s money the uh the market maker will call us and say I've got an offer on 5 million of this Bond at 60 cents on the dollar so normally if the bond was not in trouble it would trade at full value uh 100 cents on the dollar but it's offered at 60 cents on the dollar so if JN so thinks he is better informed than the rest of the market and he is sure that the trigger won't be activated and he won't lose Millions then he can seize his opportunity and buy a cat bond for a bargain [Music] price it's a

it's a tricky business because roughly every other year you have a catastrophe bond that loses money and I've been doing this for over 20 years so we've lost um a lot of money on on on those cumulatively we've made more than we've lost on net but we've had significant loss experiences for sure so if a cat bond is really triggered you lose a lot of money as an investor therefore Jon has to constantly test the most recent climate projections against his own data and calculate the extent of the pot

ential damage of those projections so here are the different end of century temperature projections so obviously the 8.5 scenario is the highest okay so 2° by 2050 45 40 Etc and we tweaked those the historical storms and ran it through their model and on average that increases by 3 1.34 so 34% you were so it's a 3 no it's a 35% 34 in what I okay 34% increase in in damage right in damage and what' you do did you oh that's annualized and you an annualize it from today or from 2020 oh okay the worl

d is getting riskier for sure so that is driving growth in our Marketplace by our estimation uh the the world needs roughly 500 billion of catastrophe of on finance largely it's for the time being uh a US centered Market but the potential worldwide is is immense you know whether it's a flooding in Germany uh flooding in Asia particularly in China you can calculate what the exposure is because in the end it's physical so really you you need effectively Google Earth and to look at all the property

around the world and understand its vulnerability to earthquakes hurricanes and floods and you can do the calculation right but what is the bottom line for the people of Bonny Dune for a lot of people up here it was a huge surprise to them that the firemen didn't come I think it really is a numbers game on people and then the amount of wealth within an entire community so you know we might have some affluent community members but it's not the Silicon Valley or you know it's not all affluent Com

m so it's not worth it for them I think it must be uh how close it is to a city that you know that they care about for most of my community it was the first time that they realized that they were not significant um and uh that that they were deemed easily disposable not significant disposable the fire department wasn't willing or able to save many of the houses so cat bonss at Bonny Dune no one noticed their existence they only work for you if you own insurable property this is bunny Doom yes uh

yes T Last Chance Road last chance Last Chance no yes this still shows us like a extremely high risk we see that historically this place has burned in the past so actual model shows that this uh Bon do location uh is like 1.18% chance of burning so that's actually within 95 percentile in terms of the risk yeah so 95% of the California has lower risk than this particular location the distance to um Wildland and Uber interface is to to close and then the Palmer jot uh severity index is too low an

d those are the reason behind um we think this location is actually too dangerous for to Ure [Music] so this is my little bunker I've got four compressed air bottles there that are full of air I'm never going to if I stay in here I could stay in here hours with those tanks with no outside air but my house would be burnt down and I've got to come out of this as soon as that big wave Burns over I've got to be out there putting out the fires but anyway this is just a little there a little insurance

policy is what it is you know I doubt 90% of the time I'm never going to use this but if if that one two five% of the time I need it it could save my life so that's why I got the compressed air tanks and the water and and it also gives our loved ones the Assurance or the feeling that oh yeah Grandpa's got it together he'll get in his little pizza oven and sit there and eat pizza you know so yeah and I've got a hoses and I've got a little can of gas there so I'm I'm Ready the people of Bonny dun

ensure their own lives and rebuild them if they need to because if you live in Bonny dun or by the mass River or in Pakistan you you'd better build your own bunker or [Music] Levy if there's anything I've learned is that it is hard to calculate the risk of a war a pandemic or climate change yet on planet Finance even this kind of risk is a good business model because the capital that's roaming the world is always looking for a way creating new arenas for profit you could call it perverse but fo

r a few years now the demand for cat bonss actually exceeds the expected [Music] catastrophes