Indexing for Success: Exploring the Risks of Passive Investing in the Age of Climate Change

Could Index Funds Face Financial Disaster due to Heat Health Emergency and Cooling Cities?

In this segment, we delve into the causes of extreme heat and discuss strategies for preparing for scorching weather. Philadelphia recently declared its first heat health emergency of the year, as temperatures are projected to climb into triple digits by the end of the week. University of Pennsylvania physician Sameed Khatana sheds light on how climate change impacts the human body and why certain groups are more susceptible to weather-related health complications. Additionally, we explore ways in which cities can enhance their heat resilience and the potential benefits of assigning names to heat waves, similar to hurricanes. Climate resilience consultant Kurt Shickman provides further insight on this topic.

Shifting focus, we take a closer look at the possibility of index funds overheating. Many individuals invest their money in index 500 funds or 401Ks and then leave them to grow passively. However, there is growing concern that the surge in passive investing could lead to a financial meltdown. To gain a deeper understanding of this issue, we speak with Andrew Lipstein, the author of the cover story in Harper’s Magazine titled “What goes up: Does the rise of index funds spell catastrophe?” by Andrew Lipstein. Through this discussion, we explore the potential risks associated with the booming popularity of index funds and consider the implications for individual investors.

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