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IN TODAYβS EDITION
1οΈβ£ Hurricane Beryl makes landfall |
2οΈβ£ Turkey closes its northwest Syria border |
3οΈβ£ Fine of the day |
Hi Intriguer. Several things are βhaving a momentβ in the US this summer. The first is the βguy in finance; trust fund; six five; blue eyes.β Enough said.
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The second is the standalone sequel to Twister, which critics have dubbed the βdark horseβ movie of 2024 (Glen Powell also stars in this somehow).
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The third is catastrophe bondsβironically, financial products designed to hedge against twistersβwhich were the best-performing asset class of 2023.
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In our top story today, we dig into cat bonds as the Caribbean anxiously plots the path of Hurricane Beryl, the earliest-ever recorded category 5 storm.

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P.S. Intrigue will take off tomorrow (4 July) but will return to your inboxes on Friday 5 July.”
THE HEADLINES
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Pressure mounts on Biden to step aside.
Representative Lloyd Doggett became the first congressional Democrat to openly call for US President Joe Biden to withdraw as the Democratic nominee after his shaky debate performance last week. Biden has blamed jet lag and his travel schedule for his poor performance and pledged to remain in the race.
EU plans to impose import duties on βsubstandard Chinese goods.β
Legislators are planning to scrap a loophole that allows duty-free shopping for items under β¬150, according to the Financial Times. The proposal targets low-cost Chinese online retailers such as Temu, AliExpress, and Shein but would apply to any retailer shipping directly from outside the EU. Last year, 2.3 billion items below the duty-free threshold were imported into the bloc.
China detains Taiwanese fishing vessel.Β
Taipei says the boat was stopped on Tuesday as it headed towards the Taiwanese island of Kinmen, roughly 3km (1.9 mi) off the mainland China coast. The Chinese Coast Guard accused the vessel and its crew of conducting illegal fishing practices in protected waters.
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Russian and Chinese leaders meet in Kazakhstan.
Presidents Vladimir Putin and Xi Jinping are in Kazakhstan for the Shanghai Cooperation Organisation (SCO) annual meeting, a Eurasian security forum dubbed the βanti-NATO.β The meeting comes as reports that Russian and Chinese defence companies are collaborating to develop attack drones based on the Iranian Shahed drone.
Over 100 dead in crowd crush in northern India.
Police are investigating the organisers of a religious eventΒ that ended in tragedy after a deadly crowd surge killed at least 121 people. Authorities say more than three times the expected number of people showed up to the morning prayer, an issue compounded by inadequate security measures.
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Tory minister predicts huge Labour win in UK election.
Work and Pensions Secretary Mel Stride says the opposition Labour Party is likely to win the βlargest majority this country has ever seenβ in tomorrowβs general election. While the final polls give Labour a ~20-point lead, Labour leader Keir Starmer said Strideβs exaggerated claim was a βvoter suppression tactic.β
TOP STORY
Why banks are closely following record-breaking Hurricane Beryl

Credits: National Hurricane Centre.
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With winds reaching 165 mph, Hurricane Beryl made landfall in Grenada and St Vincent on Monday and was upgraded to a Category 5 storm yesterday. 5 is the highest rating on the Saffir-Simpson Hurricane Wind Scale, which is used to estimate potential property damage.
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Hurricane Beryl has already killed at least three people and caused substantial damage to buildings and communication lines. Grenadian Prime Minister Dickon Mitchell stated: βIn half an hour, Carriacou [an island in Grenada] was flattened.βΒ
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A severe hurricane warning has been issued for Jamaica and the Cayman Islands today (Wednesday), which is βexpected to bring life-threatening winds and storm surgeβ to the islands. Current forecasts suggestΒ Haiti and southern Mexico are also in Berylβs path.
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The storm is now the earliest ever-recorded Category 5 stormΒ to form in the Atlantic, raising concerns about the destructiveness of this yearβs hurricane season.Β Scientists believe hurricanes will become slower and more intense as the planet and its seas continue to warm.
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Wait, why are we telling you about a hurricane?
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Because economists at the World Bank and the governments of Jamaica, the Cayman Islands and Mexico have a financial stake in Berylβs behaviour via a financial product known as βcatastrophe bondsβ (aka cat bonds).
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A cat bond allows governments and insurers to transfer the risk of extreme weather events to investors, ensuring theyβll have the money to meet expected claims.
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For investors, cat bonds represent a high-risk, high-reward strategy: a mild storm season will net them a tidy return, but a storm like Beryl could lump them with significant losses.
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In April, before the Caribbean storm season, the World Bank issued over $745M of cat bonds for Jamaica and Mexico. Hurricane Beryl is threatening to trigger those countriesβ payment clauses.
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More broadly, cat bonds are having a moment:Β
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They were the best-performing asset class of 2023, with an impressive 20% return for asset holders (outperforming hedge funds)
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A record $12.6 billion were issued in the first half of 2024
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The cat bond market is now worth ~$48B, more than twice its 2013 valuation.
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2023 was particularly lucrative for bondholders as it was a relatively quiet year for natural disasters. But this year, financial analysts are signalling caution, and Berylβs early and unwelcome appearance suggests they might be right.
INTRIGUEβS TAKE
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The βLoss and Damage Fundβ agreed at COP28 last December was hailed as a political breakthrough, although plenty of experts are sceptical that developed countries (historically the biggest polluters) will actually stick to their funding commitments.
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Cat bonds for climate-related events like storms, floods, droughts, and heatwaves could help provide a more suitable and enforceable (if more costly) way to help regions disproportionately affected by climate change receive financial compensation.
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At the considerable risk of sounding too much like Ayn Rand, might financial innovation and the free market be a more productive method of mitigating the cost of climate change than trying to convince rich governments to give money to poorer ones?
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Also worth noting:Β
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The World Bank has issued a total of $4.8B in cat bonds since it first started dealing in them in 2006.
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Thereβs troubling (if incomplete) evidence that climate change increases social, political, and geopolitical risk over the medium to long term.
A MESSAGE FROM THE DAILY UPSIDE
Smart, actionable business news trusted by 1M+ subscribers
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99% of financial news outlets serve algorithms, not readers, churning out uninspired content by journalists who barely understand the topics. In the financial and investing space, this is a complete waste of time.
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But The Daily Upside is different. Created by Wall Street insiders and bankers, this fresh, insightful newsletter delivers valuable insights that go beyond the headlines.
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And the best part? Itβs completely free.
MEANWHILE, ELSEWHEREβ¦

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π¦π«Β Afghanistan: The EUβs Special Envoy for Afghanistan stated that excluding womenβs groups from United Nations-sponsored talks with the Taliban was βworth itβ to facilitate dialogue. For the first time since seizing power in 2021, the Taliban participated in UN talks aimed at developing a unified international approach to engagement with Afghanistan.
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π³π±Β Netherlands: On Tuesday, the Dutch king swore in a new government more than seven months after the elections. The new government, headed by former intelligence chief Prime Minister Dick Schoof, is dominated by legislators loyal to controversial anti-immigrant populist Geert Wilders and his Party for Freedom.
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π΅πΒ Philippines: Delegations from China and the Philippines met in Manila on Tuesday to ease tensions in the South China Sea. On June 17, China’s navy surrounded and boarded three Filipino resupply ships near the Second Thomas Shoal, injuring Filipino navy personnel and damaging the boats with knives.
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π§π΄Β Bolivia: Bolivia summoned the Argentinian ambassador on Monday after Argentinaβs President Javier Milei claimed the attempted coup last week in La Paz was a hoax. The half-hearted effort to overthrow President Luis Arce was over just three hours after it began.
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πΉπ·Β Turkey: Turkey closed its main border crossings into northwest Syria on Tuesday after clashes between armed protesters and Turkish troops left seven protesters dead. Tensions in the border regions between Turkey and Syria escalated after a Syrian man living in central Anatolia was accused of harassing a child.
EXTRA INTRIGUE
Hereβs what weβre reading on the latest news from the AI sector:
CHART OF THE DAY

Credits: The Athletic
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Football fans are well known for pushing the limits of sports fandom, and European footballβs governing body, UEFA, is even more well known for its love of cash. By the end of the group stage of Euro 2024 just a few days ago, UEFA had handed out fines totalling a whopping β¬1,293,645 ($1,391,859).
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While some fines are downstream from a pint-too-many, thereβs been a darker side to fan behaviour at Euro 2024. Croatian, Albanian, and Serbian fans have been accused of provocative nationalism, including discriminatory chanting and displaying flags that include portions of each otherβs territory.
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More amusingly, the Danish Football Association was fined β¬10,000 after some Danish fans displayed this robustly worded banner conveying a sentiment most football fans can probably get behind.
DAILY POLL
Who should be responsible for paying for the damages caused by natural disasters? |
Yesterdayβs poll: Can the People’s Bank of China use tools to recharge the economy?
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π©π©π©π©π©π© ποΈ Yes, it’s a socialist, state influenced, market (66%)
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π¨π¨π¨β¬οΈβ¬οΈβ¬οΈ π No, the invisible hand cannot be outsmarted (32%)
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β¬οΈβ¬οΈβ¬οΈβ¬οΈβ¬οΈβ¬οΈ βοΈ Other (write in!) (2%)
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Your two cents:
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ποΈ H.C: βThere are lots of ways to do capital allocation. The question is: is it done efficiently? Over the last few decades China’s technocrats have done O.K. I don’t see any reason doubt them nowβ
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βοΈ K: βYes of course they can – it is a managed economy after all. The question is, will the fix they have in mind hold long term? in relationship to what happens with the economies around them?β
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βοΈ S.B.S: βIt is not clear that the PBC will have any effect. The absurd foreign policy of that nation deters international trade and alienates all kinds of businessβ
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Was this forwarded to you? We’re a team of ex-diplomats producing a concise and engaging geopolitical briefing for 90k+ leaders each day. Itβs free to subscribe.
βοΈ Corrections Corner
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Thanks to an eagle-eyed reader who pointed out that Chinaβs sovereign wealth fund, China Investment Corporation (CIC), manages around $1.3 trillion in assets, not $1.3 billion.