Finance

Sen. Whitehouse: Climate change could crash the financial system

Published

2 years ago

May 1, 2024

Sen. Whitehouse: Climate change could crash the financial system

The Hill reported earlier this month on how opaque decisions within the insurance industry were laying the groundwork for where Americans will live as the planet heats.

But the risk goes beyond that, many experts warn: The complex interrelationships between insurance, mortgage lending and the broader financial system have made climate change “an emerging risk to financial stability,” according to the 2023 report by the Financial Stability Oversight Committee.

Senate Budget Committee Chair Sheldon Whitehouse (D-R.I.) has been a principal voice warning of the financial risks spilling over as climate change impacts the insurance industry.

Sen. Whitehouse sat down with The Hill to discuss why he worries climate change poses risk to the global financial system and the role of the Senate in addressing it.

Q: Some experts warn about the potential of Great Recession-style systemic risk from climate insurance — but others argue that, however serious that risk might be, it’s fundamentally a regional issue, restricted to places like Florida. Which side of that do you come down on?

Whitehouse: There are very significant indicators and it’s going to be big, national, and even global. A number of studies show a very high risk to the world economy from calamities — and insurance is at the heart of that.

The Florida insurance market is more or less circling the drain right now in the way in which Freddie Mac’s chief economist predicted: that with the danger of sea level rise and coastal storm activity, coastal properties become increasingly expensive to insure and then they become uninsurable.

And once they become uninsurable, they become unmortgageable. And once buyers can’t get mortgages for those properties, the values crash — because you’ll now only have cash buyers on the demand side.

And that was predicted by Freddie Mac to produce a systemic nationwide economic shock, akin to or greater than the [2008] mortgage meltdown.

Q: So to push back on that a bit, the mortgage industry would say, even if the Florida coast becomes uninsurable, it’s still a regional problem — however serious it might be.

Whitehouse. The problem with that is that the sea levels and storm risk aren’t just increasing in Florida.

You’re seeing it through South Texas. You’re seeing it in the Louisiana and Atlantic coast. Florida is getting first and worst because it has so much coast and a sketchy insurance market. But Florida would just be the leading edge of a problem that would hit coasts all around the United States.

And you now have [flooding’s] evil twin, wildfire risk. Once you get away from the coast and out particularly to the west and to areas where wildfire risk is no longer either temporally or geographically predictable.

Q: For the Senate Budget Committee — what legislative intervention could help defray some of that risk?

Whitehouse: I mean, obviously, solving the climate problem would put a huge amount of this risk out under better control.

When we’re looking at federal debt, a third of it — a whole third — was produced by unexpected shocks, like [the mortgage crisis of] 2008, and by COVID.

And there’s every reason to believe that the shock of an insurance and property values crash from coastal and wildfire risk would be worse than those.

The thing about these climate [risks], is that unlike 2008 — where there’s panic and economic crash, the bottom falls out of markets, but then the values return. [But] if the underlying risk is that the property is going to be underwater, or that the house is going to burn four or five times during the course of a 30-year mortgage, then that [risk] that doesn’t go away. So there isn’t a rebound.

That’s what makes it so dangerous.

Finance

Where in California are people feeling the most financial distress?

Published

8 hours ago

February 27, 2026

Press Room

Where in California are people feeling the most financial distress?

Inland California’s relative affordability cannot always relieve financial stress.

My spreadsheet reviewed a WalletHub ranking of financial distress for the residents of 100 U.S. cities, including 17 in California. The analysis compared local credit scores, late bill payments, bankruptcy filings and online searches for debt or loans to quantify where individuals had the largest money challenges.

When California cities were divided into three geographic regions – Southern California, the Bay Area, and anything inland – the most challenges were often found far from the coast.

The average national ranking of the six inland cities was 39th worst for distress, the most troubled grade among the state’s slices.

Bakersfield received the inland region’s worst score, ranking No. 24 highest nationally for financial distress. That was followed by Sacramento (30th), San Bernardino (39th), Stockton (43rd), Fresno (45th), and Riverside (52nd).

Southern California’s seven cities overall fared better, with an average national ranking of 56th largest financial problems.

However, Los Angeles had the state’s ugliest grade, ranking fifth-worst nationally for monetary distress. Then came San Diego at 22nd-worst, then Long Beach (48th), Irvine (70th), Anaheim (71st), Santa Ana (85th), and Chula Vista (89th).

Monetary challenges were limited in the Bay Area. Its four cities average rank was 69th worst nationally.

San Jose had the region’s most distressed finances, with a No. 50 worst ranking. That was followed by Oakland (69th), San Francisco (72nd), and Fremont (83rd).

The results remind us that inland California’s affordability – it’s home to the state’s cheapest housing, for example – doesn’t fully compensate for wages that typically decline the farther one works from the Pacific Ocean.

A peek inside the scorecard’s grades shows where trouble exists within California.

Credit scores were the lowest inland, with little difference elsewhere. Late payments were also more common inland. Tardy bills were most difficult to find in Northern California.

Bankruptcy problems also were bubbling inland, but grew the slowest in Southern California. And worrisome online searches were more frequent inland, while varying only slightly closer to the Pacific.

Note: Across the state’s 17 cities in the study, the No. 53 average rank is a middle-of-the-pack grade on the 100-city national scale for monetary woes.

Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at jlansner@scng.com

Finance

Why Chime Financial Stock Surged Nearly 14% Higher Today | The Motley Fool

Published

20 hours ago

February 26, 2026

Press Room

Why Chime Financial Stock Surged Nearly 14% Higher Today | The Motley Fool

The up-and-coming fintech scored a pair of fourth-quarter beats.

Diversified fintech Chime Financial (CHYM +12.88%) was playing a satisfying tune to investors on Thursday. The company’s stock flew almost 14% higher that trading session, thanks mostly to a fourth quarter that featured notably higher-than-expected revenue guidance.

Sweet music

Chime published its fourth-quarter and full-year 2025 results just after market close on Wednesday. For the former period, the company’s revenue was $596 million, bettering the same quarter of 2024 by 25%. The company’s strongest revenue stream, payments, rose 17% to $396 million. Its take from platform-related activity rose more precipitously, advancing 47% to $200 million.

Image source: Getty Images.

Meanwhile, Chime’s net loss under generally accepted accounting principles (GAAP) more than doubled. It was $45 million, or $0.12 per share, compared with a fourth-quarter 2024 deficit of $19.6 million.

On average, analysts tracking the stock were modeling revenue below $578 million and a deeper bottom-line loss of $0.20 per share.

In its earnings release, Chime pointed to the take-up of its Chime Card as a particular catalyst for growth. Regarding the product, the company said, “Among new member cohorts, over half are adopting Chime Card, and those members are putting over 70% of their Chime spend on the product, which earns materially higher take rates compared to debit.”

Today’s Change

(12.88%) $2.72

Current Price

$23.83

Key Data Points

Market Cap

$7.9B

Day’s Range

$22.30 – $24.63

52wk Range

$16.17 – $44.94

Volume

562K

Avg Vol

3.3M

Gross Margin

86.34%

Double-digit growth expected

Chime management proffered revenue and non-GAAP (adjusted) earnings before interest, taxes, depreciation, and amortization (EBITDA) guidance for full-year 2026. The company expects to post a top line of $627 million to $637 million, which would represent at least 21% growth over the 2024 result. Adjusted EBITDA should be $380 million to $400 million. No net income forecasts were provided in the earnings release.

It isn’t easy to find a niche in the financial industry, which is crowded with companies offering every imaginable type of service to clients. Yet Chime seems to be achieving that, as the Chime Card is clearly a hit among the company’s target demographic of clientele underserved by mainstream banks. This growth stock is definitely worth considering as a buy.

Finance

How young athletes are learning to manage money from name, image, likeness deals

Published

1 day ago

February 26, 2026

Press Room

How young athletes are learning to manage money from name, image, likeness deals

ROCHESTER, N.Y. — Student athletes are now earning real money thanks to name, image, likeness deals — but with that opportunity comes the need for financial preparation.

Noah Collins Howard and Dayshawn Preston are two high school juniors with Division I offers on the table. Both are chasing their dreams on the field, and both are navigating something brand new off of it — their finances.

“When it comes to NIL, some people just want the money, and they just spend it immediately. Well, you’ve got to know how to take care of your money. And again, you need to know how to grow it because you don’t want to just spend it,” said Collins Howard.

What You Need To Know

High school athletes with Division I prospects are learning to manage NIL money before they even reach college

Glory2Glory Sports Agency and Advantage Federal Credit Union have partnered to give young athletes access to financial literacy tools and credit-building resources

Financial experts warn that starting money habits early is key to long-term stability for student athletes entering the NIL era

Preston said the experience has already been eye-opening.

“It’s very important. Especially my first time having my own card and bank account — so that’s super exciting,” Preston said.

For many young athletes, the money comes before the knowledge. That’s where Glory2Glory Sports Agency in Rochester comes in — helping athletes prepare for life outside of sports.

“College sports is now pro sports. These kids are going from one extreme to the other financially, and it’s important for them to have the tools necessary to navigate that massive shift,” said Antoine Hyman, CEO of Glory2Glory Sports Agency.

Through their Students for Change program, athletes get access to student checking accounts, financial literacy courses and credit-building tools — all through a partnership with Advantage Federal Credit Union.

“It’s never too early to start. We have youth accounts, student checking accounts — they were all designed specifically for students and the youth,” said Diane Miller, VP of marketing and PR at Advantage Federal Credit Union.

The goal goes beyond what’s in their pocket today. It’s about building habits that will protect them for life.

“If you don’t start young, you’re always catching up. The younger you start them, the better off they’re going to be on that financial path,” added Nihada Donohew, executive vice president of Advantage Federal Credit Union.

For these athletes, having the right support system makes all the difference.

“It’s really great to have a support system around you. Help you get local deals with the local shops,” Preston added.

Collins-Howard said the program has given him a broader perspective beyond just the game.

“It gives me a better understanding of how to take care of myself and prepare myself for the future of giving back to the community,” Collins-Howard said.

“These high school kids need someone to legitimately advocate their skills, their character and help them pick the right space. Everything has changed now,” Hyman added.

NIL opened the door. Programs like this one make sure these athletes walk through it — with a plan.