Global catastrophic financial risks?

[Geoffrey Miller]

Have there been any good analyses of possible global catastrophic financial risks?

I’m thinking of issues such as:

1) narrow AI traders cornering global capital markets through more efficient predictions, trades, and arbitrage, so ordinary folks are left with near-zero equity and pensions

2) blockchain and cryptocurrency technologies disrupting fiat-currency-denominated investments enough that most folks lose their net worth

3) AIs plus human traders finding leveragable vulnerabilities in insurance markets and engineering medium-sized physical catastrophes that turn into global financial catastrophies

4) sudden regulatory or tax-policy changes that have unanticipated snowballing effects, e.g. eliminating the US mortgage interest tax deduction suddenly crashing the US housing market.

I’d appreciate any pointers to analyses of situations like this from an EA perspective. Cheers—G

[Denkenberger🔸]

These are good points. There are number of “global systemic risk” institutes around the world, and many of them do focus on financial risk. But I would guess they would be concerned more with two and four, and not have one or three on their radar. I’m not aware of any EAs working on this.

[[deleted]]

Hauke thinks this might be worthy of further investigation:

Macroeconomic stability: A recent Lancet study suggests that the 2008 financial crisis was was associated with about 500,000 excess cancer-related deaths worldwide. This is just cancer, which only contributes to about 15% of global mortality and so a naive extrapolation might suggest mortality figures in the millions. Other factors such trade and tourism suffered significantly due to the economic crisis and thus poor countries were probably hit harder in terms of wellbeing. Fund Riccardo Rebonato, an expert on stress testing, to write more on banking regulation and stress testing banks.

From here.