Category Archives: Black Swans

5 Possible Natural Black Swan Events To Monitor In 2015

As we constantly try and avoid the “unpredictable,” I thought I would throw out a few ideas and thoughts I’ve been hearing talked about in my travels. Obviously I have no idea if anything will come from the events, but they are certainly worth thinking about. As you know, I constantly talk about the “what ifs” pertaining to geopolitical risk, but these trends are more concerning in regard to weather and natural events.

  • El Niño – I can’t stress enough how much “weather” is impacted by El Niño patterns. As of this writing there’s still a 45% to 65% chance that a full-blown El Nino weather pattern will appear in 2015. To put it simply, this warm band of water in Pacific ocean could help push the global thermometer up further in many locations. The effects could mean many different things, most of which are highly unpredictable. The biggest fear would be a massive drought in Asia couple with intense rainfall and flooding in South America.
  • Blocking Deserts in China – I don’t know if you’ve seen this yet, but workers in China are busy planting the “Great Green Wall,” a massive belt of man-made forest that eventually will stretch nearly 2,800 miles across China, in an effort to block the growth of the Gobi and Taklamakan deserts and stem the massive dust storms they create. If the trees survive and do the job as envisioned, a similar green belt might be planted in Africa. How this so called “changing of the landscape” effects longer-term weather is still up to debate. Just understand there are some dramatic man-made changes to the landscape taking place. This sounds great in theory, but generally never works out so well in practical application.
  • Ocean Acidification – The oceans are absorbing carbon dioxide and it’s causing the pH levels to change. In a just published study by British Canadian and Swedish researchers they conclude that shrimp aren’t going to taste so good to humans in the near future. There’s also been recent evidence that mussel shells are becoming more brittle because of rising acidity. There is no question that our oceans are changing. The more important question is how close are we to the “tipping point”?
  • Water Shortages – We have discussed water shortages for the past several years and this year is no different. Expected water scarcity and problems with allocation will pose significant challenges to governments in the Middle East, Sub-Saharan Africa, South Asia and northern China. I continue to believe we will see increased civil and political tensions in regions where water supplies are limited.
  • Earthquakes – To start with, lets make certain everyone understands I am a huge proponent of “fracking” and the benefits associated with US energy production and self-reliance. But at the same time we have to acknowledge some additional risk-factors that are being talked about in associat​ion. Study after study is showing an increasing risk of earthquakes along various fault lines. It’s not necessarily the fracking itself causing the concern, but rather the disposal of the millions of gallons of waste water being pumped into injection wells or disposal wells. The oil and gas industry has been grappling with the disposal piece of the puzzle for years. Several states are now starting to jump on the bandwagon and propose legislation that bans fracking in certain areas because of what they are seeing as increase earthquake risk. Regardless of if you agree or disagree this could eventually turn into more substantial headwinds for the energy industry.

What About Possible Riots In Ferguson

The great state of Missouri might still have two teams in postseason play with dreams of reaching the World Series, but unfortunately state police and FBI agents are increasingly worried about what happens if and when the grand jury does not indict white officer (Darren Wilson) for killing a black teen (Michael Brown) back on August 9th. There seems to be some spreading fear that a major riot could break out or perhaps provoke more wide-spread riots across the US. Keep in mind civil rights groups and protestors from across the country are heavily monitoring this case. According to arrest records from the St. Louis county police, of the 227 people arrested in connection with the protests, 36 were from outside Missouri, including seven from New York, 12 from Illinois and five from California. Something else to keep in the back of your mind…there are reportedly nine white and three black jurors.  Reports from inside Ferguson are that a rally held this past week by Black Lawyers for Justice in a local church, was attended by eight members of the “New Black Panther Party,” all dressed in battle fatigues and berets. There are reports circulating that Michael Brown supporters and protestors where at the recent Cardinals playoff game and where meet with heavy headwinds from the local fans as they chanted “DAR-REN WIL-SON”… There were also some fans wearing the name Darren Wilson on the back of their Cardinals jersey’s.  If you don’t think things are going to get a little crazy check out the video posted over at Deadspin by clicking here. Now I  hear a St. Louis county judge granted a 60-day extension to the grand jury, so jurors will have until Jan. 7th to make a decision.  The problem is the protesters are already starting to gather and are coming in from all parts of the country.  In fact protesters have organized four days of activities in Ferguson and surrounding areas this weekend (over the Columbus Day holiday). Starting Friday, they say they expect thousands of people to take part in marches, rallies and a yet-to-be-detailed acts of civil disobedience.  All I can say is pay close attention to this one.  Its one thing to have riots in L.A. or an Occupy Wall Street movement in N.Y., but when you start splintering the nations midsection the consequences could be much more severe. Lets just hope this thing doesn’t spiral into major civil unrest. (Source: Reuters)