Is a climate risk vibe shift coming?

Another week, another news cycle on climate doomerism.  The Guardian takes the honors this time around, with the results of a survey of climate scientists showing that 80% of respondents believe the world is on track to experience at least 2.5°C of warming above pre-industrial averages, enough to unleash devastating physical impacts and the kind of knock-on social, political, and economic shocks worthy of a “semi-dystopian” future.

The article makes for tough reading. Climate scientists – who have spent decades warning the world of the consequences of continued fossil fuel use – are described as feeling “hopeless, infuriated and scared” by governments’ failure to act. 

The science is on their side, the majority of public opinion is on their side, and, yes, some policymakers are on their side.  However, there is one entity (or rather assembly of entities) that looks far from “scared” – the financial markets.

It’s been nearly 10 years since former Bank of England Governor Mark Carney’s seminal speech on the “tragedy of the horizon”, in which he warned climate change could threaten financial system stability, and there’s little evidence that financial markets are pricing in the likelihood of a “semi-dystopian” future.