A Historic El Niño Is Coming That Could Cost the World Trillions

**Justin Mankin** (0:02)
Bloomberg Audio Studios, Podcasts, Radio, News.

**Tracy Alloway** (0:18)
Hello, and welcome to another episode of the Odd Lots Podcast. I'm Tracy Alloway.

**Joe Weisenthal** (0:22)
And I'm Joe Weisenthal.

**Tracy Alloway** (0:24)
Joe, I don't know if I've ever told you about this, but I'm a little bit of a weather nerd.

**Joe Weisenthal** (0:28)
Okay. I did maybe a little bit. I know.

**Tracy Alloway** (0:31)
I just get really excited by weather. I love thunderstorms.

**Joe Weisenthal** (0:34)
I love a good thunderstorm if I'm inside.

**Tracy Alloway** (0:36)
Well, this is the thing. I love thunderstorms except when I'm on an airplane or something like that. I do not like economically damaging weather. I feel like I need to throw that caveat in there.

**Joe Weisenthal** (0:46)
You know what I am? I'm like a weather truther.
So for example, I don't believe that there's any accurate way, for example, to measure wind chill. It's like, oh, it's like 25 degrees out and it feels like 15 It's like, how do you know what 15 feels like? You know what I'm saying? Like, I don't believe in some of these numbers. Also humidity, what, there's water in the air? Give me a break. There's no water in there. No, that one I believe in.

**Tracy Alloway** (1:10)
Tell me you've never been to Abu Dhabi in the summer without telling me you've never been to Abu Dhabi in the summer.

**Joe Weisenthal** (1:16)
No, this last week in New York, I did see that. You know what humidity feels like. I know, that one was a joke. I am a wind chill skeptic even though I don't think that's the topic of our conversation today.

**Tracy Alloway** (1:25)
It is not. The topic of our conversation is actually economically damaging weather. And specifically, the upcoming El Nino, which by the way, it's not that often that you see a lot of sell-side notes start to mention weather phenomenon. But just in the past few days, I've had a Thailand economics note from Citi talking about interest rates and quoting the potential impact of El Nino, potentially inflationary. I've had a Bank of England outlook from Morgan Stanley that mentioned El Nino, and also a Bank of America effects outlook talking about the impact on EM currencies. So this is something that people are expecting to have an actual impact both on the global economy and the investment landscape.

**Joe Weisenthal** (2:11)
I will just say, even though I'm not a weather nerd the way you are, I have this thought that if you look at the really grand sweep of history, like thousands and thousands of years, maybe even hundreds of thousands of years, I think there are two things that matter in human history. One of them, as you know, I'm interested in is basically technological evolution, media technology and how it reshapes how we think. Then the other one is climate change, weather and storms. I think that when we think about history, many things are contingent either on brief or long periods of weather change and it can reshape society in permanent, long-term, unexpected ways at the time.
Have we ever even done any El Nino episode in 10 years or 11 years of doing this? I don't think we have. But it sounds like this is one that we should cover if it's showing up on all these notes.

**Tracy Alloway** (3:06)
If we're going to cover one, this should probably be the one because at the moment, well, you have different El Nino forecasts, and there's a range of probabilities involved here. But a lot of the forecasting models are currently forecasting that this is going to be a potentially record-breaking El Nino, something we haven't seen in decades.

**Joe Weisenthal** (3:24)
Do you think there are any people who are like, oh, it's interesting you bring up the El Nino. I've always thought La Niños are the more underrated one. Do you think that's the type of guy? No, I hope not.

**Tracy Alloway** (3:35)
But are you going to become like an El Nino truther? How do you know it's El Nino unless you're standing in the Pacific Ocean measuring the water yourself?

**Joe Weisenthal** (3:43)
I'm going to be covering. You really should be paying attention to the upcoming La Niña.

**Tracy Alloway** (3:47)
Oh, good.
That'll be a fun transformation for you. Okay. Well, we do in fact have the perfect guest. We're going to be speaking to someone who not only follows the weather, but also tries to measure its economic impact. We have Justin Mankin. He is professor of geography at Dartmouth and director of the Climate Modeling and Impacts Group. Justin, thank you so much for coming on Odd Lots.