Wagering on the Flood

What's happening

Americans can place bets on wildfires, floods, hurricanes, and dozens of other natural disasters through prediction markets like Kalshi and Polymarket. During the January 2025 Los Angeles wildfires, which killed 440 people and caused $76 to $131 billion in damage, online bettors were wagering on the event and tracking returns in real time.

Hundreds of millions of dollars move through daily temperature and catastrophe markets. The phenomenon is not new. Rutgers historian Jamie Pietruska traces weather gambling to the 1930s, when a St. Louis betting racket pulled $2.6 million annually and gamblers attempted to bribe U.S. weather officials to falsify reports. Enron created weather derivatives in the late 1990s. After Hurricane Andrew, reinsurers invented catastrophe bonds.

What has changed is accessibility. Anyone with a phone can now wager on someone else's disaster. Pietruska notes the irony: the cryptocurrency mining and data centers powering these platforms contribute to the warming that produces the disasters being bet on.

What the text says

Amos 8:4-64Hear this, you who desire to swallow up the needy, and cause the poor of the land to fail,5Saying, 'When will the new moon be gone, that we may sell grain? And the Sabbath, that we may market wheat, making the ephah small, and the shekel large, and dealing falsely with balances of deceit;6that we may buy the poor for silver, and the needy for a pair of shoes, and sell the sweepings with the wheat?'"

Amos describes merchants who can hardly wait for sacred time to end so they can return to the business of exploitation. They shrink the measure, inflate the price, and sell the refuse of the wheat. The prophet's fury is not directed at commerce itself. It is directed at a system that converts human need into profit, where the buyer's desperation is the seller's opportunity.

Catastrophe markets extend that logic to its limit. The commodity is no longer grain or oil. It is the probability that someone else's home will burn. The merchant in Amos cheats the buyer. The catastrophe bettor does not even need a buyer. The disaster itself is the product.

Proverbs 1:18-1918but these lay wait for their own blood. They lurk secretly for their own lives.19So are the ways of everyone who is greedy for gain. It takes away the life of its owners.

The wisdom teacher describes those who lie in ambush, unaware they are setting a trap for themselves. "So are the ways of everyone who is greedy for gain. It takes away the life of its owners." The connection to catastrophe markets is not figurative. The energy infrastructure powering prediction platforms accelerates the climate disruption those platforms monetize. The ambush is circular: profit from the disaster your profit-seeking worsens.

The reflection

There is a difference between insuring against a flood and betting that one will come. Insurance distributes risk. A catastrophe bet concentrates profit. One system asks how we survive together. The other asks how someone profits from the ruin of others. Amos could not have imagined a market in wildfire futures. He did not need to. He saw the principle clearly enough: an economy that feeds on suffering will eventually devour the people running it. The merchants of catastrophe should read the end of the verse.