You may have noticed a distinct lack of tornado posts on Climateer Investing this spring. That has been deliberate.
I've been involved with some modeling of the hits that the insurers are taking during this tornado season but that's prop stuff and too risky for the average reader of a public blog. If I put something on the blog it is usually from publicly available sources and the advantage (if any) that readers gain is from my judgements of what is important and the likelihood of an event coming to pass.
One of the wonderful things about markets is the fact that you can make money with a far lower than 50% hit rate if you can get enough bets out to have the math work in your favor. And have risk management systems in place to correctly size your bets. And have the capital to weather the inevitable drawdowns. And understand the pros and cons of the various instruments available to gain exposure. And...
You get the picture, a lot of moving parts for a funky little blog in a spiral arm of the WWW. So I haven't posted much on tornadoes. On the other hand, hurricane season officially starts next Wednesday...
Here's the Columbia Journalism Review's The Observatory blog on AGW, cyclones and the reporting thereof:
On Monday, The Washington Post published an op-ed by Bill McKibben, a writer and environmental activist, under the sarcastic headline, “A link between climate change and Joplin tornadoes? Never!”Because the AGW signal has such wide error bars folks who care about this stuff tend to fall back on the Pacific Decadal Oscillation (more and stronger storms when the PDO is in the cool phase) and ENSO (more tornadoes when transitioning from La Nina to neutral).
McKibben mockingly chastises… well, the world, apparently. He directs his accusatory screed at “you” (as in, not him) for taking a hear-no-evil-see-no-evil position when it comes to potential connections between extreme weather and manmade climate change:
Caution: It is vitally important not to make connections. When you see pictures of rubble like this week’s shots from Joplin, Mo., you should not wonder: Is this somehow related to the tornado outbreak three weeks ago in Tuscaloosa, Ala., or the enormous outbreak a couple of weeks before that (which, together, comprised the most active April for tornadoes in U.S. history). No, that doesn’t mean a thing…When it comes to the media, at least, McKibben is off his rocker. Many journalists, at news outlets large and small, are asking questions about tornado-climate connections. They’re just not reporting the kind of overwrought assertions that he seems to expect. In fact, they’re doing a fairly good job explaining explaining the relationship between tornadoes and climate change, just as they did during the Russian heat wave and Pakistani flood last summer. Evidence abounds that journalists are getting better at covering the nuances involved in the relationships between climate change and various types of extreme weather.
It’s far smarter to repeat to yourself the comforting mantra that no single weather event can ever be directly tied to climate change.
Even Climate Progress’s Joseph Romm, a fierce critic who routinely flogs reporters for not explaining the threat of climate change more assertively, was fairly complimentary in a nice roundup; he even wrote that, “Today weatherman Al Roker appears to have gone beyond the data with his suggestion that “climate change” is bringing tornadoes to urban areas, although, admittedly, it is a brief clip and it’s not exactly clear what he is saying.” (Romm compliments McKibben’s op-ed, but they’re brothers-in-activism where climate is concerned, and well within their rights to express their opinions about the need to act.)
So what are the data and scientists saying? Let’s go back to coverage of the tornadoes that tore through the southeast and south in mid- to late April (see this 2011 tornado information fact sheet for details). Andrew Freedman quickly kicked out pieces for The Washington Post and Climate Central describing the immediate meteorological conditions (involving a southerly position of the of the jet stream and warm sea surface temperatures in the Gulf of Mexico, which abetted the convergence of a hot, humid air mass close to the ground and a cold, dry one higher up, which got all twisted up and formed funnel clouds—see this primer from the National Severe Storm Laboratory)—that created the tornadoes. He also dutifully explored the climate connection, explaining that, contrary to McKibben’s assertion in the Post:
Those of us who write about climate change are often accused of attempting to link every unusual weather event to climate change, as if increasing air and ocean temperatures can explain everything from hurricanes to snowstorms. In this case, with the second-deadliest tornado outbreak in US history, and with the most tornadoes for any April since records began in the early 1950s, it’s important to understand that the scientific evidence indicates that climate change probably played a very small role, if any, in stirring up this violent weather. This might disappoint some advocates who are already using this to highlight the risks of climate change-related extreme weather.A few days later, Wonkroom’s Brad Johnson (a colleague of Romm’s at the Center for American Progress) shook things up when he published interviews with three eminent climatologists. The most assertive statements came from Kevin Trenberth, head of the Climate Analysis Section of the National Center for Atmospheric Research, and Michael Mann, director of the Earth System Science Center at Pennsylvania State University. They told him, respectively, that “It is irresponsible not to mention climate change. … The environment in which all of these storms and the tornadoes are occurring has changed from human influences (global warming),” and “Climate change is present in every single meteorological event, in that these events are occurring within a baseline atmospheric environment that has shifted in favor of more intense weather events.”...MUCH MORE
Even here, because the historic record is so short, you might not get enough of an edge to prove that your judgement is better than chance.
We are not recommending the property/casualty insurers or the reinsurers at this time but they will be worth a look.
I'm just not sure when.
See also April 17ths "La Nina and Tornadoes"