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Don't remind me again today

This week saw an interesting convergence of minds—central bankers, financial supervisors, and researchers gathering to tackle a question that's been quietly escalating: what happens when nature stops keeping up with the economy?



The focus? Quantifying the economic fallout and financial exposure tied to ecosystem degradation. Not exactly your typical risk model discussion. We're talking about scenarios where biodiversity collapse, deforestation, or resource depletion start showing up on balance sheets.

From what's being discussed, institutions are wrestling with how to price these risks. Traditional financial models weren't built for this. How do you stress-test a portfolio against coral reef die-off or pollinator extinction? Where do you even start with the data?

Some takeaways emerging: there's growing acknowledgment that nature-related risks aren't just environmental issues—they're credit risks, operational risks, even systemic risks. The challenge now is building frameworks that can actually measure and manage them before they trigger the next wave of financial instability.
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DegenWhisperervip
· 11-30 10:06
Ngl, this is just asking for trouble, writing ecological collapse into the risk model... Are bankers finally in a panic?
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SolidityStrugglervip
· 11-27 14:56
To be honest, it's a bit late for the Central Banks to start worrying about ecological collapse leading to dumping. Ecological risks should have been accounted for from the beginning. Why wait until a systemic collapse is imminent to take it seriously? How do you stress test when coral reefs are dying? Interesting question, huh? Traditional models can't accommodate this kind of thing; we need to start from scratch. It feels like they're going to create a new risk control framework, but will it actually be usable? Nature-based risk is indeed severe, but where does the data come from? Confusing. Wait, is this laying the groundwork for the next financial crisis... Nature is not cooperating, and the financial sector is getting anxious? Makes sense.
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BearMarketBardvip
· 11-27 14:45
Finally, someone has started to ponder this, but I bet five bucks they still won't figure out how to price the collapse of coral reefs...
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BearMarketBrovip
· 11-27 14:35
Here it comes again, this set of natural capital... It sounds nice to call it "Risk Management", but to put it bluntly, it still wants to financialize the Earth.
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MetaMuskRatvip
· 11-27 14:31
The ecosystem has collapsed, and finance must follow suit. This logic is not wrong, but can it really be quantified? --- How do you price a dead coral reef on the balance sheet... it's a bit absurd. --- Central Banks have finally realized that nature is not a free ATM. --- Traditional models are completely unable to handle this type of risk; do we need to start from scratch? This is the real dilemma. --- The biodiversity crisis turning into credit risk, the eve of the next financial storm? --- To put it bluntly, it's about wanting to buy the dip in the risk premium of natural resources... the game has entered another level. --- They want to build a framework without any data; these financiers really dare to think. --- Incorporating resource depletion as a systemic risk will lead to a major reshuffle in market pricing.
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