Global Warming Will Help Push US Deficits (And Gold) Higher
London (Oct 13) Judging by comments left to many of my articles, there are still a substantial number of Seeking Alpha users who do not believe that man's activities are having a significant and negative impact on global warming. Of course, I disagree. But one thing we can agree on: the costs related to the ever more frequent and severe storms - that are fueled by higher air and water temperatures - are skyrocketing. Adding such a huge unknown (and un-budgeted line item) to an already dire deficit outlook, I would argue, is bearish for the fiscal deficit/debt outlook, but extremely bullish for gold.
Take a look at the following graphic for the number and types of weather-related disasters just last year (2017) alone:
Source: NOAA
Note the wide variety and geographic dispersion of severe disasters that had multiple occurrences in a single calendar year:
•major floods (2)
•major wildfires outbreaks (2)
•major tornado outbreaks (3)
•major hurricanes (3)
My contention is that the unknown and un-budgeted recovery costs of these severe climate-related disasters are going to significantly drive up US deficits and debt far beyond already dire forecasts. The investment angle for US investors is to buy gold.
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