Cumberland Advisors Market Commentary – Wildfires Out West

On Sunday, Bloomberg reported that this year’s California fires had scorched more ground than the last three years of fires combined. Higher temperatures and greater winds have contributed to the spread.

Patricia Healy, CFA

Year-to-date, the California fires have covered 4 million acres in 8,200 fires throughout the state. Some 8,400 homes and buildings have been lost, and unfortunately 31 lives; and there are still almost two months of peak wildfire season to go. Our hearts and prayers go out to all the affected families and first responders.

The loss is horrendous; however, California is a large state with a population of almost 40 million, covering 101.5 million acres, 33 million acres of which are forested. In terms of GDP, California has the fifth largest economy in the world. The majority of the population lives in several large cities, although more folks have moved to less populated and more forested areas that are prone to fire.

Each year, fires cause havoc and demands on resources, and then fire season is seemingly over. The rest of the world forgets as those who are affected rebuild with FEMA funds, state funds, insurance proceeds, and their own resources. States work on fire-prevention plans; first responders recover. Then rising temperatures, stronger winds, and still high “tinder” loads in forested areas combine, and the process repeats itself. Bloomberg notes that wildfires are estimated to cut 0.7% from US GDP in the third quarter. Will rebuilding in California, Oregon, and other affected states make up for that loss in the coming quarters? In many cases the rebuilding eventually does provide a benefit through increased sales taxes and employment as homes and business are restored.

Although many localities will benefit from FEMA aid and the increase in economic activity that comes with rebuilding, a fire or hurricane disrupts lives-business as usual, drains resources, and potentially leads to credit downgrades.

Hurricanes, flooding, and wildfires continue to wreak havoc on municipalities. Some are affected repeatedly, as longer-lasting and lingering storms are now causing severe flooding in areas that may not have seen it in the past. This year has brought one of the busiest hurricane seasons on record, and fires have affected much of the West. Evacuations, already fraught with anxiety, are a greater challenge given COVID-19 fears and the need for social distancing in an emergency. The frequency of events in some places may have inhabitants, insurers, and governments questioning the viability of rebuilding again and again in areas at high risk.

A September 2020 report by Moody’s reviewed the City of Mexico Beach, Florida, which was essentially flattened by Hurricane Michael in October 2018, and the City of Paradise, California, which was practically destroyed by the Camp Fire in November 2018. FEMA and state funding helped with debris clean-up and overtime costs. Mexico Beach and Paradise both have access to resources and technical advice; committed regional, state, and federal partners; revenue-raising ability in the case of Florida; and access to significant liquidity in California from the Pacific Gas & Electric Co., which was held liable for the fire.

Moody’s notes that Mexico Beach benefits from Bay County’s relatively desirable and affordable location on the Florida Gulf Coast and has attracted new residents and investors. The population increased approximately 44% from the point of the most recent census in 2010 until just before the hurricane, reaching nearly 1,500 people. Following the hurricane, the state estimated the population at 627. While older residents are choosing not to stay in Mexico Beach and rebuild, the desirability of the beachfront properties, whether for owner occupancy or investment purposes, is contributing to faster recovery for Mexico Beach.

Paradise embarked on a plan to make the town more resilient, but rebuilding has been constrained by the high cost and an extended timeline for rebuilding that has dissuaded both displaced and new residents and inhibited investor interest. The population of Paradise had remained relatively stable for 30 years before the fire, at about 26,500. Following the fire, the state estimated the population at 4,485. In total, about 35,000 residents of Paradise and surrounding unincorporated areas were displaced by the Camp Fire. The town’s nearest neighbors, the cities of Chico and Oroville, both saw a 20% increase in population, significantly straining their resources; but by the end of 2019, nearly half of those displaced by the fire had completely left Butte County.

At Cumberland Advisors we generally invest in municipal bonds that are supported by a large and diverse service-area economy with good financial management and strong financial metrics, which are characteristics of AA ratings. Diversification and financial strength allow these entities to weather a storm.  There are numerous other stresses that can affect the credit quality of an issuer, including high-grade issuers, which are not immune to downgrades. Some stressors can be long-tailed, such as the future funding level of a pension fund, and that has been one of the reasons for our not investing in New Jersey and Illinois over the years. Another example is the exodus of population over time which in the past has affected California’s bond ratings. The stressors can also be more immediate, such as an issuer taking on an unexpectedly large amount of debt or experiencing a fast drop-off in revenues, such as many issuers are contending with currently with the pandemic-induced economic shutdown. We constantly evaluate conditions, both short-term shocks and long-term trends.  In the case of fires and storms, prior to or during a potentially catastrophic event we evaluate our holdings to see if they are in the path of the event and make a decision to hold or sell.

Patricia Healy, CFA
Senior Vice President of Research and Portfolio Manager
Email | Bio


Links to other websites or electronic media controlled or offered by Third-Parties (non-affiliates of Cumberland Advisors) are provided only as a reference and courtesy to our users. Cumberland Advisors has no control over such websites, does not recommend or endorse any opinions, ideas, products, information, or content of such sites, and makes no warranties as to the accuracy, completeness, reliability or suitability of their content. Cumberland Advisors hereby disclaims liability for any information, materials, products or services posted or offered at any of the Third-Party websites. The Third-Party may have a privacy and/or security policy different from that of Cumberland Advisors. Therefore, please refer to the specific privacy and security policies of the Third-Party when accessing their websites.

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Cumberland Advisors Market Commentary – Wildfire: Correction and Addition

In our recent commentary “Wildfire: More Than a Song” https://www.cumber.com/cumberland-advisors-market-commentary-wildfire-more-than-a-song/, we stated that our nation’s federally owned forests “are housed in the Department of the Interior.”

Cumberland Advisors Market Commentary - Wildfire Correction and Addition

That is true up to a point: The Bureau of Land Management (BLM), which is an arm of the Department of the Interior, does manage 246 million acres of public lands; but only a small portion of that land is forested (much of it is rangeland or desert). Forested public land is mostly under the purview of the US Forest Service, which is part of the Department of Agriculture. The Forest Service manages 193 million acres. In addition, the Fish and Wildlife Service (FWS), in the Department of the Interior, manages 89 million acres as part of the National Wildlife Refuge System; and the National Park Service (NPS), also in the Department of the Interior, manages 80 million acres in the National Park System.

We thank reader David Kruschwitz for calling this omission to our attention.

Readers that are interested in more detail on federal land management may wish to peruse the following: https://fas.org/sgp/crs/misc/IF10585.pdf

David R. Kotok
Chairman of the Board & Chief Investment Officer
Email | Bio


Links to other websites or electronic media controlled or offered by Third-Parties (non-affiliates of Cumberland Advisors) are provided only as a reference and courtesy to our users. Cumberland Advisors has no control over such websites, does not recommend or endorse any opinions, ideas, products, information, or content of such sites, and makes no warranties as to the accuracy, completeness, reliability or suitability of their content. Cumberland Advisors hereby disclaims liability for any information, materials, products or services posted or offered at any of the Third-Party websites. The Third-Party may have a privacy and/or security policy different from that of Cumberland Advisors. Therefore, please refer to the specific privacy and security policies of the Third-Party when accessing their websites.

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Cumberland Advisors Market Commentary – Wildfire: More Than a Song

Smokey Atmosphere at Montana-Idaho Border by Mitch Kotok - Red ball is the sun - Sept 2020
Fires near the West Coast of the US created this surreal smoky atmosphere at the Montana-Idaho border. Now appearing as a red ball, the sun peeks through the haze-filled sky. Photo, Mitch Kotok, Sept 2020.

Let’s begin this missive with some remarks on wildfire issues from Philippa Dunne of TLR Analytics. Philippa has vast personal experience with fires and is one of our nation’s highly skilled analysts of labor data cohorts, including firefighters.

“Over the last decades, yes decades, news pieces on short-handed fire-crews losing control of western fires have proliferated. Firefighting is one job where redundancies are crucial. When the winds change, they shift the direction of the fire, as is likely to happen in the coming days, often trapping the crews on the wrong side of the column. Unless you have lived it, it’s hard to comprehend the anguish of waiting for the sound of sirens coming in from, say, Bakersfield.

“In purely economic terms, Governor Newsom did the right thing in ‘righting a historic wrong’ and expunging the records of some of the heroes fighting in the California Department of Corrections’ fire crews. Opening this door may also push back on the staggeringly inaccurate narrative concerning bringing ex-convicts into the workforce, and we’ll let Jeff Korzenik do the talking there.

“The power of economic narratives, carefully detailed by Robert Shiller, is demonstrated by one currently circling, further endangering the lives of our firefighters. Anyone who has been through a fire knows, ‘Listen to the fire commands.’ There’s always some looting or other mischief involved in mass evacuations, and people sometimes defy evacuation orders in order to hose down their roofs, not the smartest thing but pretty effective in smaller fires.

“But something different is happening today. Some Oregon residents are defying evacuation orders to protect their homes not from the fires but from left-wing looters they have been misled to believe cooked the whole thing up, flooding already overwhelmed fire departments, grappling with what they fear will be “mass fatality” events, with nuisance calls.

“The arson narrative, debunked by fire & police departments up and down the West Coast, is spreading on social media. The evacuation orders are coming directly from expert teams watching from helicopters and through other imagery.

“That’s some narrative. We all have voices.”

(Excerpted from TLRwire, Sept. 14, 2020. Subscription info available here: https://www.tlranalytics.com/subscriptions/tlr-wire/.)

Dear readers, more than one of every five dollars of US GDP originates in the states hit by the monster conflagration happening out West. How do we amass the labor force to deal with this problem? And in the midst of a pandemic, how do we do it safely? My friend Philippa Dunne has raised profound questions about labor and social issues related to wildfires.

Further, as we confront this historic wildfire season, we must also be thinking about the climate change issue and the great debate that revolves around it. Sadly, we are again witness to the political blame game. Candidate Trump participated in a panel discussion on the fires in Sacramento on Sept. 14. Instead of acknowledging the role of climate change, the president instead sought to lay the blame at the feet of the governors of the Western states, pointing again to “forest management” as the cause of the record fires.

California Governor Gavin Newsom responded by pointing out to Trump that 57% of forest land in California is owned by the federal government, and 3% is owned by the State of California. Newsom agreed that forest management has played a role in the worsened fire danger, but said climate change is a much bigger factor.

Wade Crowfoot, California Secretary for Natural Resources, added, “If we… think it’s all about vegetation management, we’re not going to succeed….”

Trump’s response: “Ok, it’ll start getting cooler; you just watch.”

Crowfoot: “I wish science agreed with you.”

Trump: “I don’t think science knows, actually.”

(“‘I Don’t Think Science Knows, Actually’: Trump Dismisses Climate Science In California Wildfire Discussion,” Forbes, https://www.forbes.com/sites/jackbrewster/2020/09/14/i-dont-think-science-knows-actually-trump-dismisses-climate-science-in-california-wildfire-discussion/#1f729d202e85)

Not surprisingly, candidate Biden has labeled Trump a “climate arsonist” (“Biden calls Trump a ‘climate arsonist’ who ‘won’t take responsibility’ for wildfires,” Fox News, https://www.foxnews.com/politics/biden-charges-trumps-a-climate-arsonist-who-wont-take-responsibility-for-wildfires). The governors (both Democrats and Republicans) of the various states are worried about their constituents and now face two crises: COVID-19 and wildfires. And they face them at a time when their state and local budgets are in trouble and Congress has failed to agree on a bill to help state and local governments deal with COVID-19 impacts.

Note: “The original commentary distributed via email contained an error, which we’ve replaced with correct information below. We thank reader David Kruschwitz for calling the correction to our attention. To read our followup commentary detailing those changes, please follow this link: https://www.cumber.com/cumberland-advisors-market-commentary-wildfire-correction-and-addition/

Here is a daily update source for fire information: https://www.nifc.gov/fireInfo/nfn.htm. Hat tip to Frank Mitchell for the link. Scroll down to “Current Fires” to see how many places are impacted and how much acreage is federal. Remember, the United States has vast holdings of federally owned forests. They are managed in a number of ways.

They are housed in  the Department of the Interior up to a point. The Bureau of Land Management (BLM), which is an arm of the Department of the Interior, manages 246 million acres of public lands; but only a small portion of the that land is forested (much of it is rangeland or desert). Forested public land is mostly under the purview of the US Forest Service, which is part of the Department of Agriculture. The Forest Service manages 193 million acres. In addition, the Fish and Wildlife Service (FWS), in in the Department of the Interior, manages 89 million acres as part of the National Wildlife Refuge System, and the National Park Service (NPS), also in the Department of the Interior, manages 80 million acres in the National Park System.

The Secretary of the Interior is David Bernhardt, former oil and energy industry lobbyist. He was appointed by President Trump and confirmed by the Senate, of which Mitch McConnell is majority leader. Federal lands are burning right now. So ask yourself about the blame-game politics and responsibility. While you are at it, ask what the counterfactual would be if these fires were all burning in the State of Kentucky?

Readers that are interested in more detail on federal land management may wish to peruse the following: https://fas.org/sgp/crs/misc/IF10585.pdf

The fact is that a huge labor force shock is underway and that more than one-fifth of the US economy is hurt by these fires (Why Wildfires Are So Bad This Year in California, Oregon and Washington,” Wall Street Journal, https://www.wsj.com/articles/why-wildfires-are-so-bad-this-year-in-california-oregon-and-washington-11599768604).

The private and public sectors are both impacted by wildfires and other natural disasters. Cumberland Senior Vice President of Research, Patricia Healy CFA, had this to say in the Sept. 16 issue of This Week in Bondland:

“Hurricanes and wildfires continue to wreak havoc on some municipalities, with evacuations a challenge given the COVID fears and the difficulty of social distancing in an emergency. Although many localities will benefit from FEMA aid and the increase in economic activity that comes with rebuilding, a fire or hurricane can be a major disruption and a drain on resources and can potentially lead to credit downgrades. The frequency of events in some places may have inhabitants, insurers, and government questioning the viability of living there and continually rebuilding.”

Expect to see the above quote and more from Patty in an upcoming full commentary on municipal credit and western fires published to our website and email list.

That damage piles atop the impacts of a pandemic that has caused the worst economic downturn since the Great Depression. And in the case of the fires, just as with the pandemic, a lack of federal action and funding for state and local governments can and will impair what was starting to be a fast recovery. Congress stopped doing its job and is fiddling, just as Nero did when Rome burned. Only this time it is the American West that is burning.

Where are the Senators and all of the House members of the ten states affected by wildfire thus far this fire season? Like the bipartisan group of Congress Members, They should form a mass coalition to pass a bill in both chambers and extend federal funding power to state and local governments as well as to supplement the firefighting efforts and the public health effort to counter both smoke-related respiratory illness and COVID-19.

There is serious evidence that the risk of very large wildfires is being amplified by climate change; and that the risk is real and growing, not just in the Far West but all across the US, including in Southeastern states like Florida and Georgia. See “Climate change presents increased potential for very large fires in the contiguous United States,” CSIRO, https://www.publish.csiro.au/wf/WF15083.

On Sept. 16, the Global Interdependence Center sponsored an executive briefing on the impacts of climate change, featuring Bob Bunting, CEO of the Climate Adaptation and Mitigation Center and a frequent guest author of Cumberland commentaries that have explored the effects of a warming climate on hurricanes, sea level rise, red tides, and human health. The GIC briefing may be viewed here: https://www.interdependence.org/resources/gic-executive-briefing-climate-change/.

Meanwhile, as forests and homes burn and lives are lost, conspiracy theorists are ranting and a social media frenzy is heating toward a flash point. We are even seeing a revival of the rotten old chestnut of blaming forest mismanagement, and thus the fires themselves, on the spotted owl. Interestingly, there is recent research which suggests that fires are not a serious threat to populations of spotted owls (“Wildfire management designed to protect Spotted Owls may be outdated,” Penn State Eberly College of Science, https://science.psu.edu/news/wildfire-management-designed-protect-spotted-owls-may-be-outdated). And increasingly, in the fire-prone West, a powerful coalition of timber companies, environmental groups, federal and state forestry agencies, and local governments is working hard to update fire-management policies and programs (“Trump officials blame ‘environmental terrorists’ for wildfires. California loggers disagree,” Sacramento Bee, https://www.sacbee.com/latest-news/article218559945.html).

We’ll end with a song that many may remember from times past when things were calmer. It features a poignant story in melodic form that transports our psyches and lives in memory. For me, it triggers nostalgia for a past that seems to have disappeared.

“Wildfire,” Michael Martin Murphey, 1975, https://www.youtube.com/watch?v=Pc3OnSQc48s

David R. Kotok
Chairman of the Board & Chief Investment Officer
Email | Bio


Links to other websites or electronic media controlled or offered by Third-Parties (non-affiliates of Cumberland Advisors) are provided only as a reference and courtesy to our users. Cumberland Advisors has no control over such websites, does not recommend or endorse any opinions, ideas, products, information, or content of such sites, and makes no warranties as to the accuracy, completeness, reliability or suitability of their content. Cumberland Advisors hereby disclaims liability for any information, materials, products or services posted or offered at any of the Third-Party websites. The Third-Party may have a privacy and/or security policy different from that of Cumberland Advisors. Therefore, please refer to the specific privacy and security policies of the Third-Party when accessing their websites.

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Cumberland Advisors Market Commentary – Fire and Water

The fires engulfing parts of California are feared to become the nation’s worst fire disaster, possibly surpassing 2017 and 2018 fire events. Spurred on by wind gusts of up to 80 mph, this disaster harkens back to Superstorm Sandy, which occurred seven years ago, in October 2012.

Market Commentary - Cumberland Advisors - California - A Note on the Fires
Superstorm Sandy soaked the Northeast, and its 80-mph winds caused almost $70 billion in damages per Wikipedia. It was one of the most costly natural disasters ever to hit the United States. The extent of the damage was also a function of the storm’s hitting many densely populated areas that were centers of economic activity. No one yet knows, and it will likely take some time to determine the full cost of the 2019 fires in terms of damages to homes and businesses, lives lost, and the cost of the herculean response by CalFire, municipal fire departments, and others. It is only October, while the deadly Camp fire of 2018 occurred in November, and dry conditions continue to persist. The fires this year, like Superstorm Sandy, have occurred in or near some densely populated areas with high real estate values, many businesses, and intense economic activity.

The state has experienced numerous deadly and damaging fires – think of the devastating 1906 San Francisco earthquake and fire, for instance. The reality of fires, earthquakes, and mudslides are juxtaposed with the draw of the great weather, diverse topography, access to ocean and mountains, headquarters of many industries, fertile land producing the vast majority of the country’s produce, and a long independent history. The “California dream” of finding fame and fortune continues to be an allure for many.

As the world’s fifth largest economy in terms of GDP, California has tremendous resources, as David Kotok noted in his heartfelt video on the California fires (link included in his recent commentary: https://www.cumber.com/cumberland-advisors-market-commentary-markets-the-deficit/ or directly at this YouTube link: https://youtu.be/yW1lbdkxbAw).


California’s population is wealthy. According to data released by the US Census Bureau median household income is 122% of the US national average (notwithstanding large disparities in income). So as long as the state, municipalities, and residents continue to have the resources to protect citizens and rebuild, folks will live in California. However, California does have a high cost of living and taxation, while the state and some local governments are placing ever-growing regulatory burdens on the citizenry. This, combined with increasingly severe and costly climate-related events, may cause outmigration.

Over the weekend California Governor Gavin Newsom declared a statewide emergency, which led the way for securing Fire Management Assistance Grants from FEMA. This program allows municipalities to receive reimbursement of up to 75% of fire-suppression costs. There may also be other assistance forthcoming for individuals, businesses, and municipalities, as well as insurance monies to repair and rebuild, though some may choose to relocate.

In my search for information, I came across interactive maps provided by the LA Times (https://www.latimes.com/wildfires-map/?fire=easy) and CalFire (https://www.fire.ca.gov/). They show the locations and other data for all the fires in the state, and you can drill down to individual properties. I noticed that my good friend’s home was smack dab between the Getty and Palisades fires.

On Wednesday Governor Newsom announced the establishment of the “Power Outage and Fire Response Resources” website (https://response.ca.gov/). It is hoped to be a one-stop portal for resources available to those affected by the fires and loss of power. The site also has a link to a donations page for those who would like to help Californians affected by the latest incidents.

Like the rest of the nation, we watch as fire after fire erupts and stories emerge of lives disrupted as well as heroes. Our thoughts are with those affected, which, as of last night, include 26 million folks under extreme red flag alerts in California and Arizona.

The state’s credit quality is strong, and financial management and budgeting have improved, albeit over a period of sustained economic growth. The wildfire risk may affect tourism and induce some to leave the state. However, rebuilding generally has some positive economic benefit with the inflow of aid and insurance proceeds. At Cumberland Advisors we invest predominantly in AA-rated bonds issued by government entities with strong economies and demographic trends as well as secure financial operations, management, and liquidity; and we avoid bonds that do not exhibit these characteristics. Events like fires and storms can drain resources, but over time they can be restored.

Patricia Healy, CFA
Senior Vice President of Research and Portfolio Manager
Email | Bio


Links to other websites or electronic media controlled or offered by Third-Parties (non-affiliates of Cumberland Advisors) are provided only as a reference and courtesy to our users. Cumberland Advisors has no control over such websites, does not recommend or endorse any opinions, ideas, products, information, or content of such sites, and makes no warranties as to the accuracy, completeness, reliability or suitability of their content. Cumberland Advisors hereby disclaims liability for any information, materials, products or services posted or offered at any of the Third-Party websites. The Third-Party may have a privacy and/or security policy different from that of Cumberland Advisors. Therefore, please refer to the specific privacy and security policies of the Third-Party when accessing their websites.

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Zika, Climate Change & January 25

On December 30, as 2018 drew to an end, NBC’s Meet the Press aired an entire program on the climate change crisis, well worth watching (https://www.nbc.com/meet-the-press/video/meet-the-press-1230/3850857). Host Chuck Todd gave no air time to climate change denialism. Instead, the episode plunged into analyzing the crisis at hand, what might be done, what impediments slow our time-critical response, and how to overcome those impediments. Florida Republican Representative Carlos Curbelo, among other program guests, called for constructive action. “We need to stop covering the debate and start covering the story, so that people see that this is real, and so that politicians take a more-pragmatic approach and find solutions that are actually achievable,” Curbelo said. The day after Thanksgiving, despite Mr. Trump’s personal dismissal of climate change, the Trump administration released Volume II of the Fourth National Climate Assessment (https://www.globalchange.gov/nca4), and we’ve been digesting its deeply concerning contents in the week since.

The impacts of climate change are myriad, affecting our world, our communities, our health, our food supply, and our investments. We will be taking a look at a number of climate-change-related issues impacting Florida and beyond, from sea level rise to red tide to hurricanes to fruitful adaptive strategies and the economic opportunities they present, when we convene on Friday, January 25, at the University of South Florida Sarasota-Manatee for our one-day event, “Adapting to a Changing Climate: Challenges & Opportunities.” See the full roster of speakers, including our own Patricia Healy, here: http://sar.usfsm.edu/event/adapting-to-a-changing-climate/. We hope to see you there.

In today’s commentary, however, I would like to zero in on the impact of climate change on vector-borne diseases, including Zika. Chapter 14 of the Fourth National Climate Assessment (https://www.globalchange.gov/nca4) addresses the adverse effects of climate change on human health, noting that “Climate change affects human health by altering exposures to heat waves, floods, droughts, and other extreme events; vector-, food- and waterborne infectious diseases; changes in the quality and safety of air, food, and water; and stresses to mental health and well-being” (p. 545 in the full report PDF). We have no trouble grasping the threats posed by heat waves, fires, floods, and storms that claim lives as well as property, along with droughts that parch crops and threaten water supplies, but we should not miss the implications of climate change for increased vector-borne disease risks. As the report points out, “Climate change is expected to alter the geographic range, seasonal distribution, and abundance of disease vectors, exposing more people in North America to ticks that carry Lyme disease or other bacterial and viral agents, and to mosquitoes that transmit West Nile, chikungunya, dengue, and Zika viruses” (p. 545).

The range of the Aedes aegypti mosquito, for example, a primary vector for dengue, chikungunya, Zika, and yellow fever, is expected to expand considerably worldwide, exposing far larger populations, particularly in Australia, Europe, and North America, to those viruses. According to one recent study, well before the end of the 21st century, 68%–80% of human populations may share their environments with Aedes aegypti and thus be vulnerable to the diseases that mosquito can carry, with the percentages depending on the climate change scenario that actually unfolds, (https://link.springer.com/article/10.1007%2Fs10584-016-1679-0). In general, lower greenhouse gas emissions translate to less risk for human health.

Risk of mosquito-borne diseases in general is to be understood not just in terms of the range of a particular mosquito species but also in terms of mosquito “disease danger days.” As an August 2018 report published at Climate Central points out, “there’s an elevated risk of disease transmission [assuming disease is present] when temperatures are between 61 degrees and 93 degrees Fahrenheit.” The report notes the circumstances required for disease transmission: “In addition to needing the proper climatological factors for the mosquito to survive and transmit disease, there needs to be the establishment of the disease in the first place — having the proper climatic conditions, a critical density of mosquitoes, and the conditions for the sustained cycle of disease transmission itself. And, in order to transmit disease, a mosquito must bite twice — once to acquire the disease [itself], and a second time to pass it on. The largest number of these twice-biting mosquitoes were produced at 75 degrees Fahrenheit.” (http://www.climatecentral.org/news/us-faces-a-rise-in-mosquito-disease-danger-days-21903)

Climate Central analyzed weather data for 244 US cities to determine the number of disease danger days each city faces now as the climate warms. They found that 94%, or 229, of the cities they studied are already seeing an increase in the number of days when average temperatures fall within the optimal range for mosquito-borne disease transmission. Some areas, however, may become too hot for the mosquitoes themselves. Phoenix, for example, actually has fewer disease transmission danger days than it did previously because of the number of extremely hot days the city must contend with. All in all, only 12 cities are experiencing a decrease in disease danger days. As the climate warms, the report concludes, Americans face heightened risks for dengue, Zika, chikungunya, and West Nile (http://www.climatecentral.org/news/us-faces-a-rise-in-mosquito-disease-danger-days-21903).

The 2015–2016 Zika outbreak drove home the hazards of mosquito-borne diseases, as Zika took a terrible toll on the development of one in seven unborn children whose mothers were exposed to the otherwise generally mild virus (https://www.contagionlive.com/publications/contagion/2018/october/zika-where-are-we-now). Babies were born with microcephaly and/or other birth defects such as vision problems, deafness, and epilepsy. Their lives and their family’s lives were forever changed from what might have been.

In 2018, Zika has not made many headlines in the US, and the case count is down. As of December 4, 2018, the provisional case count for US States is 58 for the year, all travelers returning from affected areas. US territories have reported 116 Zika cases, with the virus presumably transmitted through local populations of infected mosquitoes (https://www.cdc.gov/zika/reporting/2018-case-counts.html). Case counts aside, the virus remains a threat – nothing has changed about its intrinsic potential to wreak havoc. It is still active throughout the South and Southeast Asia region, and some districts in India saw worrisome outbreaks in 2018 (https://www.hindustantimes.com/health/healthwise-new-outbreaks-need-better-disease-surveillance/story-2bSekn9rGCIbWADtk9p2TK.html).

While some experts hypothesize that “herd immunity” has been achieved in areas hardest hit in 2016, Carmen Zorilla, professor of obstetrics and gynecology at the University of Puerto Rico School of Medicine in San Juan, disagrees. She estimates that about 10.5% of pregnant women in Puerto Rico tested positive for Zika during the outbreak – an infection rate not nearly high enough to confer herd immunity. She observes that such viral outbreaks tend to happen in 3–5-year cycles. (https://www.contagionlive.com/publications/contagion/2018/october/zika-where-are-we-now).

Problematically, some 60–80% of Zika cases are asymptomatic, so Zika can readily go undetected and gain a foothold before it is identified in a particular area. Fewer than half of those infected actually seek medical care (https://www.contagionlive.com/publications/contagion/2018/october/zika-where-are-we-now). Most of the time, symptoms, when people do have them, are relatively mild and somewhat flu-like: fever, rash, headache, achy joints and muscles, and conjunctivitis, though in rare instances a Zika infection can lead to Guillain-Barré syndrome. Currently, the CDC recommends Zika testing for pregnant women with possible Zika exposure and for those who experience Zika symptoms after traveling to areas where they might have been exposed to the virus (https://www.cdc.gov/zika/hc-providers/testing-guidance.html).

Is there room in that surveillance net for a Zika outbreak to fire up before it is detected? Definitely so. In 2016, a research team led by Northeastern University professor Alessandro Vespignani and overseen by the Center for Inference and Dynamics of Infectious Diseases, projected the discrepancy between the number of reported Zika cases and the likely number of actual cases. The team’s models projected that the actual number of infections in July 2016 was likely 25 times the number of confirmed cases (https://www.sciencedaily.com/releases/2016/08/160802133703.htm).

Dr. Vespignani notes that major outbreaks are associated not only with the right air temperature but also with areas of standing water. In many instances, people educated to understand the risks can manage those, emptying the birdbath or flower pot saucers and the like at least once a week; but after major precipitation events magnified by climate change, when there is standing water everywhere, mosquito populations can spike. The sopping US Southeast, where rainfall records were handily broken in 2018, can testify that there is sometimes “water, water everywhere,” to borrow a phrase from Samuel Taylor Coleridge (https://www.accuweather.com/en/weather-news/2018-leaves-its-mark-in-the-rainfall-record-books-across-eastern-southern-us/70007024).

Furthermore, densely populated areas face elevated risk. Juanita Constible, a climate expert at the Natural Resources Defense Council, explains that, for mosquitoes, “extension of habitat is a combination of climate change and human behavior. Urbanization can expand habitats for some species of mosquito that prefer cities [Aedes egypti among them], so as people expand into natural areas, those species will go with them. Not only do urban settings have plenty of habitat and food, but in cities, mosquitoes lack natural predators.” (https://www.citylab.com/environment/2018/10/hurricane-florence-mosquitoes-north-carolina/571912/)

Kate Fowlie, spokesperson for the US CDC, warns, “Mosquito-borne disease outbreaks are difficult to predict. There will be future outbreaks, including large ones, as well as years with reduced transmission, but it is impossible to know when or where these transmission patterns will occur” (https://www.contagionlive.com/publications/contagion/2018/october/zika-where-are-we-now).

It seems obvious that surveillance is key to preventing outbreaks both in the present and in a warming future, but the CDC’s funding for expanded infectious disease surveillance is due to run out in 2019. The CDC is already planning to scale back its participation in the Global Health Security Agenda (GHSA), an early-warning system for infectious disease outbreaks, in 39 of 49 countries (http://www.ghtcoalition.org/blog/global-health-and-medical-research-saved-from-the-chopping-block-in-2018-spending-bill).

While the US will be assisting with infectious disease surveillance in 10 countries, the map of Zika-affected areas around the globe, courtesy of the CDC, is expansive (https://wwwnc.cdc.gov/travel/files/zika-areas-of-risk.pdf).

There is a lot of purple on this map, but these are not all the places Zika can go; they are merely places where infection is already a risk. Infected travelers can fly all over the world, and disease-bearing mosquitoes know no borders other than inhospitable habitats. Climate change, as we have seen, will widen the range of vector-borne diseases, sharply increasing the percentage of the global population at risk. Viruses themselves, of course, are moving targets, as they mutate regularly – Zika posed no known risk to the unborn until this century, when a mutation changed what had been a mild pathogen (https://www.washingtonpost.com/news/speaking-of-science/wp/2017/09/28/zika-was-a-mild-bug-a-new-discovery-shows-how-it-turned-monstrous/?utm_term=.af60fd526a41). Scientists also warn us that we may soon be contending with disease-causing bacteria and viruses that have lain dormant for centuries or even millennia, frozen in permafrost that is now melting as the Arctic warms (www.bbc.com/earth/story/20170504-there-are-diseases-hidden-in-ice-and-they-are-waking-up).

As we look ahead, addressing climate change will clearly entail grappling with expanded threats to human health, and one of those threats will be elevated vector-borne disease risks, perhaps coupled with diseases modern medicine has yet to encounter. Climate change mitigation and adaptation, combined with vigilant surveillance, vaccine development, and mosquito population control strategies will all be keys to managing vector-borne disease risks posed by certain species of mosquitoes and ticks.

This commentary has been a deepish dive into just one of the secondary challenges climate change will pose to nations, states, cities, municipalities, and the well-being of Americans. In the instance of Zika, we know that the lifetime cost of caring for one child whose life is profoundly impacted by prenatal exposure to the Zika virus, beyond heartbreak, is likely to reach one to ten million dollars (https://wwwnc.cdc.gov/eid/article/23/1/16-1322_article). Human health is just one area in which proactively addressing climate change and adaptation makes both imminent sense and dollars and cents. Again, if you are in the Sarasota area on January 25, we hope you will join us at the University of South Florida Sarasota-Manatee for “Adapting to a Changing Climate: Challenges & Opportunities.” Find more information about this one-day event and register here: http://sar.usfsm.edu/event/adapting-to-a-changing-climate/.




January 25th & Gary Shilling

Gary Shilling is an icon of our finance industry. His monthly missive is priceless. Fred Rossi edits and researches. The work product is extraordinary. We thank them for permission to share the December monthly in full. The trigger for our request was their thorough examination of the climate-change debate and the coincident timing, as registration is now open for the January 25th GIC-USFSM conference, Adapting to a Changing Climate: Challenges & Opportunities, to be held at the University of South Florida Sarasota-Manatee.
 
Here is a link to the conference presentations lineup: http://usfsm.edu/climate
 
The conference is fully sponsored, so the registration cost is only 50 bucks to cover lunch and direct costs. Issues such as red tide, hurricane intensity, and rising sea levels are among those to be examined. The purpose of the conference is not to find fault; instead, it is to discuss what to do now and tomorrow and next week and next month.
 
Please take a look at the excellent data assembled by Gary and Fred, starting on page 31 of Gary Shilling’s Insight for December, available here as a PDF file: https://cumber.com/pdf/A.-Gary-Shilling’s-INSIGHT-December-2018-(Climate-Change-A-Look-From-Both-Sides).pdf – page=31.
 
Also look at the latest official US report on climate change, released by the Trump administration on the day after Thanksgiving: Fourth National Climate Assessment, Volume II: Impacts, Risks, and Adaptation in the United States, https://nca2018.globalchange.gov/.  
 
Another valuable source of reliable analysis of climate change comes from the Becker Friedman Institute for Economics of the University of Chicago. Their working paper 2018-51 is entitled “Valuing the Global Mortality Consequences of Climate Change Accounting for Adaptation Costs and Benefits” (August 2018). It’s available here: https://bfi.uchicago.edu/Greenstone-WP-201851.
 
We hope that you will join us at the USFSM auditorium on January 25 for the conference. Please forward this message to anyone who might be interested in this subject.

GIC & USFSM - Adapting to a Changing Climate - Challenges & Opportunities




Climate Change Resources

Cumberland Advisors is a sponsor of the upcoming USF-GIC event,

“Adapting to a Changing Climate: Global to Local Impact”

GIC & USFSM - Adapting to a Changing Climate - Challenges & OpportunitiesClimate Change Resources

Cumberland Advisors, the Global Interdependence Center, the University of South Florida Sarasota-Manatee, the Science and Environment Council and Atlas Insurance are the primary sponsors in this event that will feature Bob Bunting among other luminaries invited for this very important discussion.

In this post you’ll find a compilation of resources that can be referenced as part of the ongoing conversation on climate change and its impact.

Event links

USFSM Website & Event Registration: http://usfsm.edu/climate

Flyer for event:

(Long URL) https://www.cumber.com/pdf/USFSM-GIC-January-25-2019-Agenda-for-Adapting-to-a-Changing-Climate-Global-to-Local-Impact.pdf

(Short URL) https://buff.ly/2QqOQY9

Cumberland Advisors Commentaries

123

Research

Red Tide Current Status: http://myfwc.com/redtidestatus

NASA Climate Change Resources: https://climate.nasa.gov/resources/

Press Releases

123

Press Coverage

Sarasota Magazine – Climate Change Conference Set for Jan. 25.




Climate Change Conference Set for Jan. 25

Excerpt of Sarasota Magazine’s…

Climate Change Conference Set for Jan. 25

Topics will include the implication of rising sea levels for Florida, the effect of climate change on hurricanes, whether climate change worsens red tide and more.

By Staff 12/4/2018 at 10:37am

Cumberland Advisors, the Global Interdependence Center, the University of South Florida Sarasota-Manatee, the Science and Environment Council and Atlas Insurance are organizing a conference that will examine “Adapting to a Changing Climate.” The featured speaker will be Bob Bunting…

Read full article at Sarasota Magazine.




January 25th and California Fires

The January 25th GIC-USFSM conference on adaptive climate change, Adapting to a Changing Climate: Challenges & Opportunities, to be held at the University of South Florida Sarasota-Manatee, includes discussion of fires as well as hurricanes. Here is a recent Bloomberg story for reference: “What Wildfires and Hurricanes Mean for the Global Economy” (https://www.bloomberg.com/news/articles/2018-11-22/what-wildfires-and-hurricanes-mean-for-the-global-economy).

2018 has been a horrible and murderous year for fires. We all know that. The issue for climate change deniers and for climate change believers is whether we can expect normalcy or whether something is different now, requiring adaptive solutions. January 25 will focus on that question.

Cumberland Advisors is proud to sponsor this conversation, which presents skilled professionals in a transparent and independent forum. Attendance costs only $50 to cover lunch (registration here).

Now we offer a guest commentary about the California fires. We thank our good friend and GIC board colleague Philippa Dunne for sharing her essay with our readers. Philippa is coeditor of three  macroeconomic newsletters – The Liscio Report, which has a trading focus, Sightlines Bulletin, which offers “concise data-driven monthly analyses of the direction of the American economy,” for professionals and academics, and TLR Wire, frequent, short notes and graphs on important aspects of fresh data missed by the mainstream intended for all readers You can learn more about both and subscribe at http://www.tlranalytics.com.

California Fires, by Philippa Dunne

Two differences jump out when we attend conferences with a higher percentage of speakers who were not born in the US, but may teach here, and we share these now as observations, not criticism. There is considerably more concern voiced about the effects of market concentration and pricing power, which we have outlined; and there is a general sense that US citizens, perhaps especially those in the financial markets, are not accurately anticipating the market impacts when, say, lawsuits and insurance claims caused by extreme weather start rolling in at an ever faster pace.

I grew up in Malibu, where fires were a central part of my childhood.

Every fire has its own unforgettable personality. One marches as a belligerent wall, missing little in its path to the shore; one changes its mind at the last minute, trapping the fire crews and their equipment on the wrong side of the column; and some, like the recent Woolsey fire, flame seemingly in all directions, pouncing on areas the size of football fields in a second.

And they all have different ways of introducing themselves. Sometimes a bunch of tumbleweeds thud into the house: the Santa Ana wind. Sometimes sirens race up the highway; by the time I was five, I could tell which canyon they turned into; and sometimes I would first see reflected flames flickering in my window. Then it’s grab all the animals and your toothbrush, unlock all the doors and gates for the firemen, kiss the ground by your bedroom door with hope, and head for the Georgian Hotel in town. From our rooms there we would stay up all night, looking out across the bay as the unspeakably beautiful flames winged up and down the mountains, seemingly in silence although we knew they were panting.

Firefighting is a male-dominated field. The first female firefighter in this country was Molly Williams, Volunteer #11, a slave owned by a New York City merchant. There have been all-female forest crews since the 1920s, but in the US only 2% of firefighters are women. Los Angeles Mayor Eric Garcetti promised that by 2020, 5% of the LAFD will be women; currently that’s 3.5%. I’m not being sexist when I refer to my wonderful childhood heroes as men.

An owl lands on the beach; a coyote limps on singed foot pads, showing no interest in a fleeing rabbit. A firefighter staggers in the wind.

The fires have always been unpredictable and terrifying, but they have moved into a new dimension. The Paradise fire has set records, but the recent Woolsey fire that flew to the beach in west Malibu, bad as it was, isn’t up to today’s standards. In 1970, the Santa Ana, blowing at 80 miles an hour and gusting to twice that, drove a 30-mile wall of fire from Newhall to Malibu. First we heard it mentioned on the news, and then it was barreling over the mountain so quickly that we barely had time to load up the animals. It did take out the Spahn Ranch, where Charlie Manson and his crew lived (no comment), but also the iconic Serra Retreat, a real loss. That fire was a record-setter then, but it isn’t even in the top twenty these days.

I recently visited friends in Santa Barbara and finally saw firsthand the incomprehensible destruction in the path of the fire and floods of last year. One friend, a real estate agent in Montecito, one of the most idyllic places on earth, said that he is having a tough time determining if business is slow because of interest rates or because buyers are afraid to invest in multi-million-dollar properties threatened by fires and rushing mud. We drove through the slide area: Geologists are still calculating how much the mud (A Look Inside the Montecito Disaster Probe), the consistency of honey and traveling at up to 27 miles an hour, was needed to launch “giant boulders” down the washes.

Thank you, always, to the fire crews, both the pros and the inmate volunteers making $2 a day (and $1 an hour when they are fighting active fires) – may many more go on to join Cal Fire; to the California Highway Patrol – you haven’t lived until a CHP yells at you to “gun it” in order to get over a smoldering divider; and to the migrant farmers who kept working in the fields through the smoke.

My job during the fires was always to drag panicked horses out of their stalls and onto the beach. They really do run back into burning barns. To give you an idea what it’s like, during the Newhall-Malibu fire I was pulling a mare across the sand when I noticed I was stumbling inexplicably, or so I thought. I looked down at my foot, now in slow motion, which was sitting on a board. I picked up my foot and the board came with it, held by a large nail that I couldn’t feel. A stranger ran over, said “It’s okay to scream,” pulled the board off, and raced me across the sand to the vet’s office. I got a tetanus shot and no other treatment. There was no time for that. And mine was just an ordinary fire experience.

No horses were lost in that canyon, but we feel a bit like those horses right now. We’re not a political newsletter, and this is one of the most divisive topics in our country right now. Voicing these opinions could lose subscribers, but we are willing to take that risk. We all have different opinions and want to hear yours.

The optimistic approach is the one that takes steps to slow the climate changes that produce increasingly heavy weather and the historic droughts that make devastating fires more likely. Stephen Pekar, who runs the paleoclimate research lab at the City University of New York, among his many other activities, notes that climate changes are now taking place between 100 and 1000 times faster than they have in the past. To get to the point of taking steps to curb climate change, we have to change the conversation. The risk is asymmetrical – didn’t that Schopenhauer guy have something to say about that? While it’s true that there have always been dramatic shifts in climate, the drivers of those shifts can be measured, and they do not fully account for what we are seeing. We all need to know what the cores drawn from the Greenland ice sheet are telling us. That key research is beautifully chronicled in Richard Alley’s Two-Mile Time Machine (https://www.amazon.com/Two-Mile-Time-Machine-Abrupt-Climate/dp/0691102961). Otherwise we have only opinions.

There are tremendous opportunities in the renewable energy sector, jobs that would help balance the increasingly unequal opportunities available to our working classes. For renewable sources to really take off, we’d have to drop subsidies for the fossil-fuel producers and let the markets work. When the mechanization of our farms sent farm work tumbling from something like 30% of the workforce to the current 1–3%, depending on how you jigger the numbers, the transition was largely enabled by the war effort. Workers were moved from the farms into the factories, and much of what they made was battle-related. Had they been left in the rural areas to fend for themselves, as so many of our machinists have been, what would have happened? Of course, we’d advocate for a green-energy rebuild and retrofitting, not more weaponry, and the tools are ready at hand.

Frank Nutter, head of the Reinsurance Association of America, told writer Eugene Linden a quarter of a century ago that “global warming could bankrupt the [reinsurance] industry.” Linden also points out that while the Insurance Information Institute was singling out Florida as having the greatest exposure to the combined effects of a changing climate, Governor Rick Scott and Senator Marco Rubio went on record to dismiss the threat.

Cargill’s Gregory Page agreed to be on the board of bipartisan Risky Business, which aims to put a price on all of this. You can tell he doesn’t like being there, and good for him for stepping up. He did say he was willing to do so only because the outfit aims to document risks, not look for solutions. Whatever, but he did add that in agriculture the “threat of long-term weather-pattern changes cannot be ignored.”

The IMF produced a 2015 report (https://www.imf.org/en/News/Articles/2015/09/28/04/53/sonew070215a) showing that around the world fossil fuel subsidies amount to $5.3 trillion, or 6.5% of world GDP. Climate-minded economists reckon it would take 1% of world GDP to devise and implement remediation. But that $5.3T amounted to more than total health spending of all the world’s governments at the time. Apparently, the IMF rechecked their work when they saw their results, and we rechecked ours. (Read that again if you need to.)

Around the world we’re using big tax dollars to support a backward-looking sector, making it harder to implement programs tailor-made to get us beyond stagnant wage growth of our middle classes. Although fossil fuel operations lift wages in a slim tranche of well-paid workers, they are not engines of job creation. Green projects, whether they be high-tech explorations or muscle-power retrofits, create jobs that pay well, and retrofits are labor-intensive. They also offset municipal costs for heating and cooling, and cutting back on the time we spend stuck in traffic jams would raise productivity. There’s a lot more data; but as long as people see climate change as an ideological battle, data do not help much. We’ll be happy to send links; just email Philippa: philippa@panix.com

Cue in the creative destruction of a true market economy.


Here is the link to the latest US government report on climate change. We recommend perusal with and open mind and a willingness to alter views: Fourth National Climate Assessment, Volume II: Impacts, Risks, and Adaptation in the United States, https://nca2018.globalchange.gov.

For more information on how to join us in this important conversation at the January 25th GIC-USFSM conference, please visit www.usfsm.edu/climate.

GIC & USFSM - Adapting to a Changing Climate - Challenges & Opportunities
 

David R. Kotok
Chairman and Chief Investment Officer
Email | Bio


Links to other websites or electronic media controlled or offered by Third-Parties (non-affiliates of Cumberland Advisors) are provided only as a reference and courtesy to our users. Cumberland Advisors has no control over such websites, does not recommend or endorse any opinions, ideas, products, information, or content of such sites, and makes no warranties as to the accuracy, completeness, reliability or suitability of their content. Cumberland Advisors hereby disclaims liability for any information, materials, products or services posted or offered at any of the Third-Party websites. The Third-Party may have a privacy and/or security policy different from that of Cumberland Advisors. Therefore, please refer to the specific privacy and security policies of the Third-Party when accessing their websites.

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Red Tide, January 25th Sarasota Conference on Climate Change

The January 25th GIC-USFSM conference, Adapting to a Changing Climate: Challenges & Opportunities, to be held at the University of South Florida Sarasota-Manatee, is open to the public. The sponsors, including Cumberland, helped so as to allow the cost of registration to be held to $50, a registration fee that covers the lunch.

GIC & USFSM - Adapting to a Changing Climate - Challenges & Opportunities
 

Climate-change believers and deniers are welcome. The purpose of the event is to put facts and details in the public domain for discussion.

Red tide and the toxins it carries are among the issues we will take up. Ask any Sarasota restauranteur or hotel manager what has happened to business these last few months, and the economic impact on Florida becomes clear. All political personalities interested in mitigating the effects of red tide on their jurisdictions are welcome to attend or send staff.

Let me get to a specific health issue related to red tide. I will start with a quoted email from a national personality whom I know personally. He contracted an illness believed to be a result of breathing red tide toxin or the related algae bloom toxin.

He wrote:

“I’ve easily found articles with various analyses of probable causality between bodily responses to Brevetoxins and auto-immune system responses generally associated with organizing pneumonia.

“The experts I have want to identify similar episodic correlations in order to study specific trends and narrow the range of potential causality.

“Has your group associated among any Florida pulmonologists that have seen similar cases?

“One of the fundamental issues may be that the primary group at risk of serious chronic illness is visitors that have no prior immunities from low doses of Brevetoxin exposure. They suffer the effects of a red tide bloom of Karenia brevis algae and then leave Florida before any of the major chronic illness symptoms appear.

“They know they are sick but have no contact with medical professionals that understand normal red tide irritations. That now seems to be the primary missing link.

“Research is so much fun (if only I didn’t have to concurrently live the experience).”

My friend also sent this report:

“David,

“Initial biopsy result on the biggest spot in my lung found ‘organizing pneumonia’ and no malignancy – good news.

“The point at which the coughing and respiratory irritation that resulted in this particular ‘pneumonia’ began, however, directly coincides with my exposure to red tide in April. My med records are very clear that there was no cough or other irritation symptoms before that exposure.

“If there would be any interest in this situation among you and your friends, let’s talk.

“I’m going to enjoy Thanksgiving with family and head to FL. If there’s interest, maybe we can gather and discuss a follow-up for the public health of FL, as Judy and I traverse the Tampa area after Thanksgiving.

“My AA pulmonologist and I will do more to follow up in Dec. I’ve got numerous other spots we need to analyze further before declaring ‘victory.’”

Dear reader: My point of this personal story is direct. This could be you or me. Research and discussion are needed. And what we’re dealing with here is a second-order effect of climate change, just like growing hurricane intensity and rising sea levels.

We are going to have a full auditorium on January 25, with thorough presentations and discussions of facts.

Below is a series of extracts and links on the red tide and toxin issues:


“Harmful Algal Bloom (HAB)-Associated Illness… Harmful algal blooms (HABs) are the rapid growth of algae that can cause harm to animals, people, or the local ecology. A HAB can look like foam, scum, or mats on the surface of water and can be different colors. HABs can produce toxins that have caused a variety of illnesses in people and animals. HABs can occur in warm fresh, marine, or brackish waters with abundant nutrients and are becoming more frequent with climate change.”
(Centers for Disease Control and Prevention, https://www.cdc.gov/habs/index.html)


“Exposure to harmful algal bloom toxins found in cyanobacteria (blue green algae) or Karenia brevis red tide can cause severe illness in pets, livestock, and wildlife when contaminated water is ingested or when animals lick their fur after swimming.”
(Florida Dept. of Health, http://www.floridahealth.gov/environmental-health/aquatic-toxins/aquatic-toxins-program-animal-health.html)

“About Red Tide… Algae are vitally important to marine ecosystems, and most species of algae are not harmful. However, under certain environmental conditions, microscopic marine algae called Karenia brevis (K. brevis) grow quickly, creating blooms that can make the ocean appear red or brown. People often call these blooms ‘red tide.’

“K. brevis produces powerful toxins called brevetoxins, which have killed millions of fish and other marine organisms. Red tides have damaged the fishing industry, shoreline quality, and local economies in states such as Texas and Florida. Because K. brevis blooms move based on winds and tides, pinpointing a red tide at any given moment is difficult.

“ASSESSING THE IMPACT ON PUBLIC HEALTH

“In addition to killing fish, brevetoxins can become concentrated in the tissues of shellfish that feed on K. brevis. People who eat these shellfish may suffer from neurotoxic shellfish poisoning, a food poisoning that can cause severe gastrointestinal and neurologic symptoms, such as tingling fingers or toes.

“The human health effects associated with eating brevetoxin-tainted shellfish are well documented. However, scientists know little about how other types of environmental exposures to brevetoxin—such as breathing the air near red tides or swimming in red tides—may affect humans. Anecdotal evidence suggests that people who swim among brevetoxins or inhale brevetoxins dispersed in the air may experience irritation of the eyes, nose, and throat, as well as coughing, wheezing, and shortness of breath. Additional evidence suggests that people with existing respiratory illness, such as asthma, may experience these symptoms more severely.”
(Centers for Disease Control and Prevention, https://www.cdc.gov/hab/redtide/pdfs/about.pdf)


Here are additional red tide resources:

“Harmful Algal Bloom (HAB)-Associated Illness… Publications, Data, & Statistics”
(Centers for Disease Control and Prevention, https://www.cdc.gov/habs/publications.html)

Here is the link to the latest US government report on climate change. We recommend perusal with an open mind and a willingness to alter views: Fourth National Climate Assessment, Volume II: Impacts, Risks, and Adaptation in the United States, https://nca2018.globalchange.gov/.

For more information on how to join us in this important conversation, please visit www.usfsm.edu/climate

David R. Kotok
Chairman and Chief Investment Officer
Email | Bio


Links to other websites or electronic media controlled or offered by Third-Parties (non-affiliates of Cumberland Advisors) are provided only as a reference and courtesy to our users. Cumberland Advisors has no control over such websites, does not recommend or endorse any opinions, ideas, products, information, or content of such sites, and makes no warranties as to the accuracy, completeness, reliability or suitability of their content. Cumberland Advisors hereby disclaims liability for any information, materials, products or services posted or offered at any of the Third-Party websites. The Third-Party may have a privacy and/or security policy different from that of Cumberland Advisors. Therefore, please refer to the specific privacy and security policies of the Third-Party when accessing their websites.

Sign up for our FREE Cumberland Market Commentaries

Cumberland Advisors Market Commentaries offer insights and analysis on upcoming, important economic issues that potentially impact global financial markets. Our team shares their thinking on global economic developments, market news and other factors that often influence investment opportunities and strategies.