ABSTRACT
The global financial crisis that originated in the subprime mortgage market in the United States in 2008 has spread to all major financial markets around the world. This chapter illustrates what people can learn from the financial crisis in order to manage the carbon crisis better. "In a time when climate change is a really major challenge for us, to simply deal with the financial crisis and not use that as an opportunity to accelerate our response to global warming would be a tragedy." The chapter compares the short- and long-term effects of the financial crisis with the likely effects of a global carbon crisis. Financial markets and the natural environment are, at first glance, only indirectly linked to the economic system. The financial crisis brought about a lending/equity gap and an ensuing asset price collapse, which in turn resulted in governments bailing out the banking sector and the nationalization of banks.
