h a l f b a k e r yA riddle wrapped in a mystery inside a rich, flaky crust
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Not a bad idea, but I suspect the word "disaster" and "sold"
might raise some hackles. |
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There's a problem here which might also be a solution to a
different problem. (i.e. here's an advantage to the idea
which you haven't mentioned). |
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The problem is, if you invest in building, storing, and
maintaing these, you earn a return on that investment
only in the event of one of those "far out on the tail of the
distribution Taleb black swan" -type events, that are too
rare for reliable statistical modeling. So this would
represent a very uncertain investment. |
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But there exist potential counterparties seeking insurance
against these events. Normally, the the parties who
insure them expect to lose money in the event of, e.g. a
tsunami, and expect to remain solvent based on the rarity
of that event (i.e. they expect to collect insurance
premiums from the customers who don't experience a
natural disaster, to compensate). |
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But that requires a good estimate of the probability of the
event, which is problematic for large, rare events. |
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An alternative is to devise an investment which makes
money in the event of such a disaster, and sell shares in
that investment, as insurance, to people who would lose
money in the event of the disaster. The profit-loss
calculation should be independent of the probability of
the disaster. (Shouldn't it? Am I missing something?) |
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You can accomplish that with financial jiggery-pokery, but
in the event of a disaster, someone, somewhere, is going
to have to pay. Much better if you can contrive to sell
something whose value increases -- really increases, in the
physical world, not just on paper -- in the event of a
disaster. Like a cargo ship loaded with food, fresh water,
prefab housing, etc. |
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The plan's not perfect: there's a moral hazard. That is,
there's a temptation to not adequately maintain the
ships and their cargo. But that should be preventable with
a system
of inspections paid for by the investors. |
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Sort of like a world-size emergency first aid kit. [+] |
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I'm sure they do, [Ian]. I'm sure they do. |
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//More //
Ah - you can't beat a good bit of NWOBHM. I'm going to see Iron Maiden in August. |
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Baked: US aircraft carrier. |
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No no [DIYMatt], the idea is to help after a disaster, not to cause one. |
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