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Billionaire hedge fund manager Paul Singer has issued an unusual warning for investors, calling the threat of a widespread blackout from an electromagnetic surge the "most significant danger" in the world. Called an "electromagnetic pulse" or EMP, the events can occur naturally from solar storms or artificially from a high-altitude explosion of nuclear weapons. "While these pages are typically chock full of scary or depressing scenarios, there is one risk that is head-and-shoulders above all the rest in terms of the scope of potential damage adjusted for the likelihood of occurrence," Singer wrote to clients of his $24.8 billion Elliott Management on Monday in a standard investment update letter. "Even horrendous nuclear war, except in its most extreme form, can [be] a relatively localized issue, and the threat from asteroids can (possibly) be mitigated."
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Paul Singer This threat ishead-and-shoulders aboveall othersLawrence Delevingne | ldelevingneTuesday 29 Jul 2014 | 144 PM ET
Pixelparticle | iStock 360 | Getty Images
Concept image of an electromagnetic field
Billionaire hedge fund manager Paul Singer has issued an unusual warningfor investors calling the threat of a widespread blackout from anelectromagnetic surge the most significant danger in the world
Called an electromagnetic pulse or EMP the events can occur naturallyfrom solar storms or artificially from a high-altitude explosion of nuclearweapons
While these pages are typically chock full of scary or depressing scenariosthere is one risk that is head-and-shoulders above all the rest in terms of thescope of potential damage adjusted for the likelihood of occurrence Singerwrote to clients of his $248 billion Elliott Management on Monday in astandard investment update letter Even horrendous nuclear war except inits most extreme form can [be] a relatively localized issue and the threatfrom asteroids can (possibly) be mitigated
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Read More rsaquo Paul Singer US stocks frothy by all measures
(A natural EMP event) today would cause a massive disruption to theelectric grid possibly shutting it down entirely for months or longer withunimaginable consequences Singer wrote Only two years ago the sun letloose with a Carrington-magnitude burst but the position of the earth at thetime prevented the burst from hitting it The chances of additional events ofsuch magnitude may be far greater than most people think
Carrington refers to a solar storm in 1859 that caused telegraph systemsto fail around the world
Singer warned that a man-made EMP attack would be even worse
It would not cause any blast or radiation damage but such an attack wouldhave consequences even more catastrophic than a severe solar storm Itcould not only bring down the grid but also lay down a very intense very fastpulse across the continent damaging or destroying electronic switchesdevices computers and transformers across America the letter said
A spokesman for Elliott declined further comment
The letter called on leaders to protect the power grid and essential electronicdevices He also said that spare parts should be stockpiled and thatgovernment and other groups should prepare an emergency response plan
Why are we writing about this topic Because in any analysis of societalrisk EMP stands all by itself Congressional committees are studying thisproblem and federal legislation is laboriously working its way through theprocess the letter said We think that raising peoples consciousness aboutwhat should be a bipartisan push to make the country (and the world) saferfrom this kind of event is a good thing to do
Read More rsaquo Notorious Doomsday Prophets
Lawmakers are aware of the threat
The consequences of such an attack could be catastrophic all electronicspower systems and information systems could be shut down Rep ScottPerry said in prepared remarks during an EMP hearing in May held by theUS House Committee on Homeland Security This could then cascade intointerdependent infrastructures such as water gas and telecommunications
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Lawrence DelevingneLawrence Delevingne is the lsquoBig Moneyrsquo enterprisereporter for CNBCcom and NetNet
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While we understand this is an extreme case we must always be prepared incase a rogue state decides to utilize this technology
mdashBy CNBCs Lawrence Delevingne
Lawrence DelevingneEnterprise Reporter
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About CNBC Site Map Video Reprints Advertise Careers Help Contact Corrections Newsletters
Privacy Policy - UPDATED Terms of Service(New) Independent Programming Report Latest News Releases RSS
Data is a real-time snapshot Data is delayed at least 15 minutesGlobal Business and Financial News Stock Quotes and Market Data and Analysiscopy 2014 CNBC LLC All Rights Reserved
Read More rsaquo Paul Singer US stocks frothy by all measures
(A natural EMP event) today would cause a massive disruption to theelectric grid possibly shutting it down entirely for months or longer withunimaginable consequences Singer wrote Only two years ago the sun letloose with a Carrington-magnitude burst but the position of the earth at thetime prevented the burst from hitting it The chances of additional events ofsuch magnitude may be far greater than most people think
Carrington refers to a solar storm in 1859 that caused telegraph systemsto fail around the world
Singer warned that a man-made EMP attack would be even worse
It would not cause any blast or radiation damage but such an attack wouldhave consequences even more catastrophic than a severe solar storm Itcould not only bring down the grid but also lay down a very intense very fastpulse across the continent damaging or destroying electronic switchesdevices computers and transformers across America the letter said
A spokesman for Elliott declined further comment
The letter called on leaders to protect the power grid and essential electronicdevices He also said that spare parts should be stockpiled and thatgovernment and other groups should prepare an emergency response plan
Why are we writing about this topic Because in any analysis of societalrisk EMP stands all by itself Congressional committees are studying thisproblem and federal legislation is laboriously working its way through theprocess the letter said We think that raising peoples consciousness aboutwhat should be a bipartisan push to make the country (and the world) saferfrom this kind of event is a good thing to do
Read More rsaquo Notorious Doomsday Prophets
Lawmakers are aware of the threat
The consequences of such an attack could be catastrophic all electronicspower systems and information systems could be shut down Rep ScottPerry said in prepared remarks during an EMP hearing in May held by theUS House Committee on Homeland Security This could then cascade intointerdependent infrastructures such as water gas and telecommunications
NetNet Trader Talk
howViking preps $2 billion illiquid investmentsfundAlpha addict The amazing career of LeonCoopermanKKR buys into money-minting energy hedgefundThough just 3 outperform ETFs keepgrowingA year of winners (and losers) post-Alpha
Jeff CoxJeff Cox is finance editor for CNBCcom
Lawrence DelevingneLawrence Delevingne is the lsquoBig Moneyrsquo enterprisereporter for CNBCcom and NetNet
Stephanie LandsmanStephanie Landsman is one of the producers ofFast Money
NETNET TV rsaquo
Deep dig into labor participationnumbers CNBCs Patti Domm and Jeff Cox discuss thejobs report and the current dilemma of long-term unemployment
GDP disappointment CNBCs Patti Domm and Jeff Cox discuss therecent GDP numbers and what factors havebeen affecting it
Volatile rotation puts investorson edgeInvestors give and investors take away andnowhere has that been more true lately than invalue stocks
WALL STREET rsaquo
Disgraced hedge fund sees profitsoarPoint72 Asset Management the revamped firmof the billionaire investor Steven A Cohengenerated a profit of nearly $1 billion for the firsthalf
Wall Street to get reads fromFed GDPWall Street on Wednesday gets two reads onthe economy one from the CommerceDepartment and the other from the FederalReserve
GDP views From recovery to
NetNet Private Equity and Hedge Funds Wall StreetUS Economy Technology Investing Hedge Funds
While we understand this is an extreme case we must always be prepared incase a rogue state decides to utilize this technology
mdashBy CNBCs Lawrence Delevingne
Lawrence DelevingneEnterprise Reporter
RELATED TOPICS
GDP views From recovery torecessionIt may take a while before investors get a clearpicture on just how wellmdashor poorlymdashthe USeconomy is performing
TOP NEWS amp ANALYSIS rsaquo
Argentina defaults for second time in 13yearsWhy are market bulls sticking by SamsungA family lost The risk of trucks on US roadsMarkets could begin to ignore FedEnergy firms rethink Russia after newsanctions
Data also provided by
NEWSEconomyFinanceHealth CareReal EstateRetailWealthAutosEarningsEnergyMediaPoliticsCommentarySpecial ReportsAsiaEurope
MARKETSPre-MarketsUSAsiaEuropeStocksCommoditiesCurrenciesBondsFundsETFs
INVESTINGFinancial AdvisorsPersonal FinanceCNBC ExplainsPortfolioWatchlistStock ScreenerFund Screener
TECHRecodeMobileSocial MediaEnterpriseGamingCybersecurity
SMALL BUSINESSFranchisingFinancingManagement
VIDEOLatest VideoDigital WorkshopUS VideoAsia VideoEurope VideoCEO InterviewsAnalyst InterviewsFull EpisodesClosed Captioning
SHOWSWatch LiveCNBC USCNBC Asia-PacificCNBC EuropeCNBC WorldFull Episodes
About CNBC Site Map Video Reprints Advertise Careers Help Contact Corrections Newsletters
Privacy Policy - UPDATED Terms of Service(New) Independent Programming Report Latest News Releases RSS
Data is a real-time snapshot Data is delayed at least 15 minutesGlobal Business and Financial News Stock Quotes and Market Data and Analysiscopy 2014 CNBC LLC All Rights Reserved
NetNet Private Equity and Hedge Funds Wall StreetUS Economy Technology Investing Hedge Funds
While we understand this is an extreme case we must always be prepared incase a rogue state decides to utilize this technology
mdashBy CNBCs Lawrence Delevingne
Lawrence DelevingneEnterprise Reporter
RELATED TOPICS
GDP views From recovery torecessionIt may take a while before investors get a clearpicture on just how wellmdashor poorlymdashthe USeconomy is performing
TOP NEWS amp ANALYSIS rsaquo
Argentina defaults for second time in 13yearsWhy are market bulls sticking by SamsungA family lost The risk of trucks on US roadsMarkets could begin to ignore FedEnergy firms rethink Russia after newsanctions
Data also provided by
NEWSEconomyFinanceHealth CareReal EstateRetailWealthAutosEarningsEnergyMediaPoliticsCommentarySpecial ReportsAsiaEurope
MARKETSPre-MarketsUSAsiaEuropeStocksCommoditiesCurrenciesBondsFundsETFs
INVESTINGFinancial AdvisorsPersonal FinanceCNBC ExplainsPortfolioWatchlistStock ScreenerFund Screener
TECHRecodeMobileSocial MediaEnterpriseGamingCybersecurity
SMALL BUSINESSFranchisingFinancingManagement
VIDEOLatest VideoDigital WorkshopUS VideoAsia VideoEurope VideoCEO InterviewsAnalyst InterviewsFull EpisodesClosed Captioning
SHOWSWatch LiveCNBC USCNBC Asia-PacificCNBC EuropeCNBC WorldFull Episodes
About CNBC Site Map Video Reprints Advertise Careers Help Contact Corrections Newsletters
Privacy Policy - UPDATED Terms of Service(New) Independent Programming Report Latest News Releases RSS
Data is a real-time snapshot Data is delayed at least 15 minutesGlobal Business and Financial News Stock Quotes and Market Data and Analysiscopy 2014 CNBC LLC All Rights Reserved
