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A super-pressurized, 290-mile-long river is running under the ice sheet. That could be bad news for sea-level rise.

FOR ALL ITS treacherousness and general inclination to kill you, Antarctica’s icy surface is fairly tranquil: vast stretches of miles-thick whiteness, with not a plant or animal to speak of. But way below the surface, where that ice meets land, things get wild. What scientists used to think was a ho-hum subglacial environment is in fact humming with hydrological activity, recent research is revealing, with major implications for global sea-level rise.

Researchers just found that, at the base of Antarctica’s ice, an area the size of Germany and France combined is feeding meltwater into a super-pressurized, 290-mile-long river running to the sea. “Thirty years ago, we thought the whole of the ice pretty much was frozen to the bed,” says Imperial College London glaciologist Martin Siegert, coauthor of a new paper in Nature Geoscience describing the finding. “Now we're in a position that we've just never been in before, to understand the whole of the Antarctic ice sheet.”

Antarctica’s ice is divided into two main components: the ice sheet that sits on land, and the ice shelf that extends off the coast, floating on seawater. Where the two meet—where the ice lifts off the bed and starts touching the ocean—is known as the grounding line.

But the underside of all that ice is obscured. To find out what’s going on below, some scientists have hiked across glaciers while dragging ground-penetrating radar units on sleds—the pings travel through thousands of feet of ice and bounce off the underlying seawater, so the researchers can build detailed maps of what used to be hidden. Others are setting off explosions, then analyzing the seismic waves that come back to the surface to indicate whether there’s land or water below. Still others are lowering torpedo-shaped robots through boreholes to get unprecedented imagery of the underside of the floating ice shelf. Up in the sky, satellites can measure minute changes in surface elevation, which indicates the features below—a swell, for instance, might betray a subglacial lake.

This new research on the subglacial river used radar data from aircraft flying over Antarctica. The scientists paired that data with complex modeling of the area’s unique “basal” hydrology, like how water is expected to move underneath miles of ice.

As the scientists found out, it moves very weirdly. Because there can be miles of ice resting on Antarctica’s land, and because the region isn’t warming as fast as the Arctic, the ice doesn’t melt the way you might think, from the sun striking the surface. That’s the way it works in places like Greenland, where ever-warming temperatures are creating lakes on the surface of the ice, and that water then leaks down through crevasses, known as moulins.

But in Antarctica, the basal melt instead comes from the land warming the ice. While it’s not volcanically boisterous, Antarctica has enough geothermal heat to get melt going. Further heat is provided by friction, as the ice grinds across bedrock. That means that instead of the melt happening top down, it happens at the bottom.

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It’s not a tremendous amount of melt per square foot. But over an area that’s the size of two large European countries, that scales up. “What we concluded is the melting is really small—it's like a millimeter per year,” says Siegert. “But the catchment is enormous, so you don't need much melting. That all funnels together into this river, which is several hundred kilometers long, and it's three times the rate of flow of the river Thames in London.”

That water is under extreme pressure, both because there’s a lot of ice pressing down from above and because there isn’t much room between the ice and the bedrock for the liquid to move around. “And because it's under high pressure, it can act to lift the ice off its bed, which can reduce friction,” Siegert says. “And if you reduce that basal friction, the ice can flow much quicker than it would do otherwise.” Think of that ice like a puck sliding across an air hockey table, only instead of riding on air, the ice is riding on pressurized water.

This massive hidden river, says University of Waterloo glaciologist Christine Dow, lead author of the new paper, “can pump a huge volume of fresh water into the ocean.” And that could be bad news for the glacial ice sheet’s connection to the floating ice shelf. “Where the ice begins to float is the most sensitive region,” she continues. “So anything that is going to change where that grounding line rests is going to have significant control on how much sea level rise we have in the future.”

What’s holding the ice sheet back—and keeping sea levels from jumping many feet—is the ice shelf, which acts like a big, heavy cork to slow the flow of a glacier into the sea. But in Antarctica, these corks are fragmenting, as warming waters eat away at the underside of them. The ice shelf of Antarctica’s Thwaites Glacier (aka the Doomsday Glacier), for instance, could crumble in three to five years, recent research suggests. If we lost Thwaites entirely, it alone would contribute two feet to sea levels.

It’s not just Thwaites. Researchers are finding that many of Antarctica’s grounding lines are receding, like hairlines. Yet models that predict the future state of these glaciers assume that grounding lines are static. Scientists already know that those models are missing another key factor that may affect how well these lines can hold: an effect known as tidal pumping. When tides go in and out, they heave the ice shelf up and down, allowing warm seawater to rush inland and melt the underside of the ice. This new research now shows that pressurized meltwater is also coming from the other direction, flowing from inland to the grounding line.

“The problem is, if you have a lot of fresh water being pumped into the ocean, it buoyantly moves up toward the base of the ice, and it's dragging warm ocean water up with it, melting that ice,” says Dow. “That causes that grounding line to retreat. And then all of the ice that was formerly grounded is now floating to instantly add to sea level rise and destabilize the whole system.” In other words, the ice doesn’t have to melt to raise water levels, because its massive bulk displaces liquid too.

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Another concern is what will happen if Antarctica’s ice starts behaving more like Greeland’s—melting from the top. In that scenario, crevasses would open up in the glacial ice during the summer, allowing water to pour down to the bedrock, supercharging the subglacial hydrology. “There's likely to be surface melt at some point in the future, probably within the next 100 years,” says Dow. “If that water is able to get to the base of the ice, then we could have a system that's a lot more like Greenland and a lot more seasonally driven. We don't really know what that's going to do yet.”

“This article is a notable contribution to our understanding of how the veins and arteries of fresh water beneath the Antarctic ice sheets may look and act,” Penn State glaciologist Nathan Stevens, who wasn’t involved in the paper, emailed WIRED from Antarctica, where he’s conducting his own research. “Subglacial hydrology is one of the big players in how ice sheets behave—now, in the future, and in the past.”

If there’s any good news in this situation, says University of Houston physicist Pietro Milillo, it’s that scientists are gathering ever more data on the hitherto hidden dynamics playing out beneath Antarctica’s ice. “This paper adds a piece to the puzzle of understanding what's actually going on at the grounding line,” says Milillo, who studies Antarctic glaciers but wasn’t involved in the research.

Previously, Milillo says, there was a mismatch between the satellite data and the models. The elevation changes that satellites were measuring from space would suggest more ice loss than the amount of melt that models predicted seawater would cause at the grounding line. Now, he says, it’s clear the satellites were right. “We can actually account for that,” Milillo says, “because it's fresh water that's melting the glaciers from the bottom.”

Satellite monitors discovered two vessels with their trackers turned off in the area of the pipeline prior to the suspected sabotage in September.

THE FIRST GAS leaks on the Nord Stream 2 pipeline in the Baltic Sea were detected in the early hours of September 26, pouring up to 400,000 tons of methane into the atmosphere. Officials immediately suspected sabotage of the international pipeline. New analysis seen by WIRED shows that two large ships, with their trackers off, appeared around the leak sites in the days immediately before they were detected.

According to the analysis by satellite data monitoring firm SpaceKnow, the two “dark ships,” each measuring around 95 to 130 meters long, passed within several miles of the Nord Stream 2 leak sites. “We have detected some dark ships, meaning vessels that were of a significant size, that were passing through that area of interest,” says Jerry Javornicky, the CEO and cofounder of SpaceKnow. “They had their beacons off, meaning there was no information about their movement, and they were trying to keep their location information and general information hidden from the world,” Javornicky adds.

The discovery, which was made by analyzing images from multiple satellites, is likely to further increase speculation about the cause of the blasts. Multiple countries investigating the incident believe the Nord Stream 1 and 2 pipelines were rocked by a series of explosions, with many suspicions directed at Russia as its full-scale invasion of Ukraine continues. (Russia has denied its involvement.) Once SpaceKnow identified the ships, it reported its findings to officials at NATO, who are investigating the Nord Stream incidents. Javornicky says NATO officials asked the company to provide more information.

NATO spokesperson Oana Lungescu says it does not comment on the “details of our support or the sources used” but confirmed that NATO believes the incident was a “deliberate and irresponsible act of sabotage” and it has increased its presence in the Baltic and North Seas. However, a NATO official, who did not have permission to speak publicly, confirmed to WIRED that NATO had received SpaceKnow’s data and said satellite imagery can prove useful for its investigations.

To detect the ships, Javornicky says, the company scoured 90 days of archived satellite images for the area. The company analyzes images from multiple satellite systems—including paid and free services—and uses machine learning to detect objects within them. This includes the ability to monitor roads, buildings, and changes in landscapes. "We have 38 specific algorithms that can detect military equipment," Javornicky says, adding that SpaceKnow’s system can detect specific models of aircraft on landing strips.

Once it gathered archive images of the area, SpaceKnow created a series of polygons around the gas leak sites. The smallest of these, around 400 square meters, covered the immediate blast area, and larger areas of interest covered several kilometers. In the weeks leading up to the explosions, SpaceKnow detected 25 ships passing through the region, from “cargo ships to multipurpose larger ships,” Javornicky says. In total, 23 of these vessels had their automatic identification system (AIS) transponders turned on. Two did not have AIS data turned on, and these ships passed the area during the days immediately ahead of the leaks being detected.

By international law, large ships are required to install and use AIS. This vessel tracking system was created to help ships navigate and avoid potential collisions with other vessels. When turned on, AIS will broadcast a ship’s name, location, the direction of travel, speed, and other information.

It is relatively rare for ships to turn off their AIS transponders. Ships that “go dark” are often suspected of being involved in illegal fishing or modern slavery, with officials in Europe previously investigating ships that are believed to have turned off their AIS transponders. “It would not be common practice [to have AIS turned off], unless the vessels have a classified military mission or they would have some clandestine objectives, because the Baltic Sea is one of the busiest seas in the world in terms of commercial traffic,” says Otto Tabuns, the director of the Baltic Security Foundation, an NGO that focuses on the region.

Tabuns says the Baltic Sea has multiple main “arteries” where ships travel and it is “responsible” for ships in the area to have their AIS trackers turned on. Collisions at sea can be deadly and environmentally ruinous. “There are many places in the [Baltic] sea that are not navigable for bigger ships,” Tabuns says. “There are also some areas that are not recommended or where it is prohibited to ship because of the heritage of World War Two.” Decades-old wartime submarines and munitions litter the Baltic Sea’s floor.

SpaceKnow detected the ships that had AIS turned off using synthetic aperture radar (SAR) images from satellites. Most satellites observing Earth take photos of what’s beneath them; others, however, also use SAR to bounce radio waves off the ground and create images from them. Andrey Kurekin, a coastal ocean color scientist at the Plymouth Marine Laboratory who has analyzed satellite images for detecting objects at sea, says SAR technology can be useful for detecting ships, as it shows reflections from metal objects. “They are shown as bright objects in SAR images,” Kurekin says.

Kurekin says SAR images can be used to identify the longitude and latitude coordinates of a ship, the direction it is heading, and potentially to estimate its speed. “The main advantage of SAR over optical sensors is that the microwaves penetrate through clouds,” Kurekin says. The images are less impacted by the weather and can also provide visibility at night. “It's quite difficult to hide a ship from a SAR sensor,” Kurekin adds.

SAR images of the dark ships shared with WIRED show the vessels as glowing objects, not far from the explosion site around Nord Stream 2. “We assume it was one of those two dark ships that we have detected, but we're not making any decision,” Javornicky says. He says the company is not in the business of determining what may have happened or who is responsible but instead provided the data to authorities.

Kurekin cautions that AIS tracking systems onboard ships can, at times, fail. The signal from AIS could stop communicating with satellites or receivers on land, Kurekin says, adding that the signal can be impacted by the weather too. “If there is a vessel that you can see in SAR image but it's not reported by the AIS system, it does not necessarily mean that there's something wrong with this vessel,” Kurekin says. Signals from AIS transponders can also be manipulated—warships have had their AIS data spoofed, and ships around Russia and the Black Sea have vanished from trackers in recent years.

While there are multiple ongoing investigations into the explosions, determining the full picture of what happened may take some time. Police in Copenhagen said its initial investigations have determined that “powerful explosions” caused “extensive damage” to the pipes. Images taken from around the exploded sections of the pipe appear to show that at least 50 meters of the pipeline were destroyed in the explosions.

In an email, the Swedish security service, Säkerhetspolisen, said that due to “secrecy” around its operations, it could not discuss its investigation or whether it was looking at satellite data. However, agency spokesperson Gabriel Wernstedt says the organization is conducting a “criminal investigation of gross sabotage” around both the Nord Stream 1 and 2 pipes. “Certain seizures were made during the onsite investigations that are being analyzed,” Wernstedt says. In public statements, Säkerhetspolisen has confirmed denotations happened at the pipes and that the Swedish armed forces are involved in the investigations.

However, while the investigations are ongoing, there appear to be difficulties between the countries that are looking into the incident, which could slow the process. While Sweden says it is working with investigators in Germany and Denmark, the official leading its investigation has rejected plans to form a joint investigation.

Tabuns says he hopes that the incident will act as motivation for countries to work on better ways to share intelligence, particularly as Sweden and Finland apply to join NATO. Each country will have its own levels of classification for information and systems where it collects intelligence—these may often not be compatible, Tabuns says. However, he adds that the events should see countries look at increasing the “integration of existing national systems so that there would be real-time information sharing for any response.”

Partial easing of housing-sector rules comes as Beijing also seeks to lessen economic toll of strict Covid controls

For much of the past year, China’s economy has been reeling under Xi Jinping’s dual campaigns to rein in soaring property prices and to stamp out any traces of Covid-19 within the country’s borders.

Now, as he moves to loosen pandemic restrictions, China’s leader, Mr. Xi, is signaling a reversal of his real-estate crackdown, too, a tacit acknowledgment of the economic pain and public frustration that the two policies have engendered.

China’s central bank and top banking regulator issued a wide-ranging series of measures aimed at bolstering housing demand and supply, according to a notice circulated on Friday to the country’s financial institutions and officials involved in policy-making. The authenticity of the document was confirmed by people close to the central bank.

The new policies, which were signed off on by Mr. Xi, according to the officials involved in policy-making, unwind some of the previous restrictions aimed at curbing property developer debt and give lenders permission to extend loans to home builders in financial trouble.

“These property measures, on top of announcements of Covid loosening, are a clear indication that Beijing’s efforts to support growth are intensifying,” said Michael Hirson, head of China Research at 22V Research, a New York-based firm focused on investment strategy.

While local governments across China have taken more modest measures to ease some of the pressure facing real-estate companies, the new bundle of 16 measures represents the single biggest step yet to rescue a sector that has for decades been a key pillar of growth for the world’s second-largest economy.

The new measures are “massive in scale” and amount to “targeted credit easing for the property industry,” said Dan Wang, chief economist at Hang Seng Bank China, who drew a contrast with previous rounds of incremental support measures.

As developers face looming loan repayment deadlines, regulators are eager to avoid any systemic risks in the financial sector triggered by a wave of potential defaults, Ms. Wang said. Even so, she added, “demand for home purchase remains weak,” with any reversal in housing-market sentiment likely to depend on the longer-term outlook for the economy.

The easing of real-estate and Covid restrictions comes just weeks after Mr. Xi secured another five years in power at a closely watched Communist Party congress. With Mr. Xi having consolidated political control, he now faces the prospect of a third term in office facing the country’s worst prolonged economic slowdown in decades.

Much of the economic weakness is a direct product of his campaign-style clampdowns to crush Covid and, starting last year, tame a four-decade-old property market boom that officials have warned may be a bubble.

The property measures led to increased defaults by property developers, rising bad debts for banks, falling home sales and investment—all of which have weighed heavily on overall growth in recent quarters.

China’s gross domestic product expanded just 3.0% in the first nine months of 2022, well below the government’s official full-year target of about 5.5%, set in March.

Chinese home prices have for decades outpaced the rate of broader economic growth, driving more credit into real-estate speculation and further pushing up property values. Authorities in recent years have repeatedly tried to break the vicious cycle with various tightening measures, only to loosen them whenever growth appears threatened.

By 2019, the total value of Chinese homes and developers’ inventory was $52 trillion, according to Goldman Sachs Group Inc., twice the size of the U.S. residential market.

As Beijing tightened the screws on developers last year—and then reaffirmed their commitment to the tougher rules—several private developers began to teeter on the brink of crisis. Among the most prominent was China Evergrande Group, long the country’s largest developer and now its biggest debtor, though the concerns have spread to other large private players.

More than 30 developers have defaulted on their dollar-denominated bonds. International investors have dumped their bonds, driving price levels to new lows and leaving even the strongest private developers struggling to sell new debt.

As the broader economic pain mounted this year, regulators and regional governments moved only modestly to try to avert a full-blown housing crisis, introducing limited measures such as tax rebates, cash rewards and lower down payments, as well as providing banks with window guidance to increase property lending. But those piecemeal moves have so far failed to reverse sentiment and lift the sector.

In October, sales at the country’s 100 largest property developers fell to the equivalent of $76.7 billion, down 28.4% from a year earlier and the 16th straight month of year-over-year declines, according to China Real Estate Information Corp., an industry data provider.

Now, with a new leadership team in place after the party congress—one packed with party members loyal to Mr. Xi—the top leader is moving toward a more concerted approach to shoring up the economy, part of a broader effort to brace for greater competition with the U.S.

“It seems that room for policy easing has widened post-party congress,” said Larry Hu, a Hong Kong-based economist at Macquarie. “After the impact of previous efforts turned out to be muted, policy makers are giving a big push now to get credit to flow to the property sector.”

Credit has been a particular headache for developers, since many had relied on heavy borrowing to build new projects and stay afloat. In the first nine months of this year, funds raised by China’s property developers dropped by 24.5%, according to data from the National Bureau of Statistics.

The new notice, jointly issued by the People’s Bank of China and the China Banking and Insurance Regulatory Commission, doesn’t represent a total reversal of Mr. Xi’s earlier efforts to tamp down exuberance in the sector.

The notice, which has been billed as a package aimed at ensuring the sector’s “stable and healthy development,” still underlines the need to curb speculative real-estate buying, repeating Mr. Xi’s mantra that “housing is for living in, not for speculating on.”

Under the new measures, developers’ outstanding bank loans and some types of nonbank credit due within the next six months can be extended for a year. Repayments on developers’ bonds can also be extended.

In addition, banks are encouraged to offer financing to unfinished housing projects and negotiate with home buyers on extending mortgage repayment, an apparent effort to help defuse growing resentment among those who have boycotted mortgage payments since the summer.

Banks are also encouraged to offer financing to support acquisitions of real-estate projects by financially sounder developers from weaker ones.

The new policies require financial institutions to treat state-owned developers and private developers equally, a measure that appears aimed at addressing banks’ reluctance to lend to private developers, according to Yan Yuejin, research director at Shanghai-based E-House China R&D Institute, a research firm.

“Regulators are making all-round efforts to target a soft landing for the property sector,” said Bruce Pang, chief China economist at Jones Lang LaSalle. Still, with the measures’ heavy skew toward improving liquidity for cash-strapped developers, he said, “these measures likely aren’t enough to avert the slowdown in the physical market.”

A savings mix of stocks and bonds has helped offset losses in previous years—but not this one

For decades, Americans planning for retirement have been advised to invest in a mixture of stocks and bonds.

The idea was simple. When stocks did well, their portfolios did, too. And when stocks had a bad year, bonds usually did better, which helped offset those losses.

It was one of the most basic, dependable ways of investing, used by millions of Americans. This year it stopped working.

Despite a powerful rally last week after cooler-than-expected inflation data, the S&P 500 is down in 2022 about 15%, including dividends, while bonds are in their first bear market in decades. A portfolio with 60% of its money invested in U.S. stocks and 40% invested in the 10-year U.S. Treasury note has lost 15% this year. That puts the 60-40 investment mix on track for its worst year since 1937, according to an analysis by investment research and asset management firm Leuthold Group.

Many Americans are seeing decades’ worth of savings shrink, week by week. Belt-tightening among millions of households could serve as yet another drag on an economy already suffering from high inflation, a slowing housing market and rapidly rising interest rates.

Eileen Pollock, a 70-year-old retiree living in Baltimore, has seen the value of her portfolio, with a roughly 60-40 mix, dip by hundreds of thousands of dollars. The former legal secretary had amassed more than a million dollars in her retirement accounts. To build her savings, she left New York to live in a less expensive city and skipped vacations for many years.

“A million dollars seems like a great deal of money, but I realized it’s not,” she said. “I saw my money was piece by large piece disappearing.”

Bonds have helped offset the pain of the previous market crises, including the bursting of the dot-com bubble in 2000, the global financial crisis of 2008, and, most recently, the brief but punishing bear market brought about by the Covid-19 pandemic in 2020.

This year, U.S. Treasurys are having what could wind up being their worst year going back to 1801, according to Leuthold, as central banks have swiftly raised interest rates in a bid to quell inflation. The iShares Core U.S. Aggregate Bond exchange-traded fund, which tracks investment-grade bonds, has lost 14% on a total return basis.

The declines weigh especially on baby boomers, who have hit retirement age in worse financial shape than the generation before them and have fewer earning years ahead to recover investment losses.

“What’s shocking investors is there’s no place to hide,” said Peter Mallouk, president and chief executive of wealth-management company Creative Planning in Overland Park, Kan. “Everything on the statement is blood red.”

In 2008—the year the housing market crashed, Lehman Brothers declared bankruptcy and Congress agreed to an unprecedented bailout plan to rescue the financial system—bond prices soared. Investors with 60% of their money in stocks and 40% in bonds would have outperformed investors with all of their money in stocks by 23 percentage points, according to Leuthold.

Investors with a mix of stocks and bonds also came out significantly ahead of those putting all their money in stocks in 1917, the year the U.S. entered World War I; in 1930, during the Great Depression; and in 1974, after a staggering market selloff brought on by a series of crises including surging oil prices, double-digit inflation and Richard Nixon’s resignation over the Watergate scandal.

That final year, the S&P 500 declined 26%, including dividends. But 10-year Treasurys returned 4.1%. That meant a portfolio with 60% of its money in stocks and the remainder in bonds would have ended the year down 14%—a big hit, but still much better than the 26% loss it would have suffered had it been all in stocks.

Investors in a U.S. government bond are virtually certain to be paid their principal back when the bond matures. But before then, the bond’s value can fluctuate wildly—especially in the case of a bond that has many years before maturity. An investor holding a hypothetical older bond with a $100 face value and 1% coupon, or annual interest rate, that matures in seven years would get far less than $100 if she sold that bond today. That’s because the newest seven-year Treasury was recently issued with a coupon of 4%. To compensate for her bond coming with a much smaller coupon, the investor would have to sell at a lower price.

Miss Pollock said she wishes she didn’t have so much money tied up in the markets, but is in too deep to pull out of her investments. She has resigned herself to wait things out—hoping that the market will eventually go back up.

“If I get out of it, I’ll only lock my losses in,” she said. “I’ll just have to hang on to my belief in the American economy.”

Delaine Faris, 60, retired from her job as a project manager in 2019. She had hoped her husband, a technology consultant, could join her in a few years, based on how much their savings mix of 70% stocks and 30% bonds had grown over the previous decade. The couple took a big trip to Europe, then Argentina. They sold their house in Atlanta and moved to an exurb where they planned to settle down.

“I saved and invested responsibly and made plans,” Ms. Faris said.

Earlier this year, she strongly considered returning to work to supplement their savings. Layoffs in the technology industry have added to the couple’s worries.

She considers herself and her husband fortunate that they still have a home, his job, their health and their savings, but the past year has been a “big gut check,” she said. “Millions of us said, ‘We’re going to retire early, yay,’ and now we’re thinking, ‘Wait a second, what the heck happened?’ ”

Roughly 51% of retirees are living on less than half of their preretirement annual income, according to Goldman Sachs Asset Management, which this summer conducted a survey of retired Americans between the ages of 50 and 75. Nearly half of respondents retired early because of reasons outside their control, including poor health, losing their jobs and needing to take care of family members. Only 7% of survey respondents said they left the workforce because they had managed to save up enough money for retirement.

Most Americans said they would prefer to rely on guaranteed sources of income, like Social Security, to fund their retirement—not returns from volatile markets. But only 55% of retirees are able to do so, the firm found.

Susan Hodges, 66, and her wife decided to pull all their money out of the markets in May. “We can only take so much anxiety,” she said.

The couple, based in Rio Rancho, N.M., have since put some money back into stocks, but remained cautious, keeping roughly 10% of their overall retirement funds in the market. The couple has also become extra judicious about where and how they spend their money, cutting back on dining out and discussing online purchases with each other before pulling the trigger.

Market returns have grown increasingly important for U.S. households trying to prepare for retirement. In 1983, 88% of workers with an employer-provided retirement plan had coverage that included a defined-benefit pension, which provides payments for life, according to a report from the Center for Retirement Research at Boston College using data from the Federal Reserve.

In the following decades, traditional pensions were replaced by 401(k)-style retirement plans. By 2019, 73% of workers with an employer plan had only defined-contribution coverage, in which the amount of money available in retirement depends on how much workers and employers put into the plan and how that money is invested.

An October survey from the American Association of Individual Investors found that respondents had about 62% of their portfolios in stocks, 14% in bonds and 25% in cash. That stock allocation matched the average in data going back to 1987, while investors were keeping a bit less in bonds and more in cash than the long-term norm.

Defined-contribution retirement plans have leaned into stocks. In the 401(k)s of workers still employed by their retirement plans’ sponsor, 68% of participants’ assets were invested in equity securities, including the stock portions of funds, at the end of 2019, while 29% of assets were in fixed-income securities, according to a report earlier this year from the Employee Benefit Research Institute and the Investment Company Institute.

No one knows when the typical stock-and-bond portfolio will start working again, but the economic outlook is darkening. Economists surveyed by The Wall Street Journal expect the U.S. to enter a recession within the next 12 months as slowing growth forces employers to pull back on hiring.

Unlike during the dot-com crash, the financial crisis and the early days of the pandemic, the Fed appears unlikely to swoop to the markets’ rescue by loosening monetary conditions. Fed Chairman Jerome Powell has emphasized the need to keep raising interest rates to bring down inflation, even if it results in some economic pain.

Many financial advisers caution against abandoning the stock-and-bond approach after just one year of unusually bad returns. They point to charts tracking the S&P 500’s upward climb over the decades and note that throughout history, investors who bought at the end of the worst selloffs have been richly rewarded. Someone who entered the U.S. stock market during the depths of the financial crisis in 2009 would have received a return of roughly 361% over the following 11 years—enjoying stocks’ longest-ever stretch of gains.

For now, some advisers are reminding clients of the importance of staying diversified, such as by holding commodities like oil and precious metals along with stocks and bonds, or of holding enough cash to cover coming bills.

Eric Walters, a financial adviser based in Greenwood Village, Colo., said his clients have seemed notably sober as of late.

“Often we will start meetings and they will nervously ask, ‘Are we OK?’ ” he said. “I think they’re referring to the country and the economy and the stock market, and they’re also referring to themselves personally: Are we OK financially?”

Johnathan Bowden, a 64-year-old in Conroe, Texas, is no stranger to investing. He has read financial news for decades, tunes into webinars hosted by Morgan Stanley’s E*Trade platform and trades options on the side.

After retiring in June 2021, he began worrying the stock market’s supercharged run wouldn’t last. His fears were confirmed this year.

Rather than allowing himself to obsess over how badly the markets were doing, Mr. Bowden returned to his former job as a procurement manager. He works part-time—just enough to give himself a financial cushion, and to occupy himself during the week.

“I spent 40 years making this money,” Mr. Bowden said. “I don’t want to blow it.”

The electricity industry is increasingly turning to a tool of last resort when power demand threatens to outstrip supply: asking users to turn off the lights.

To get through temperature extremes and tight electricity supplies, grid operators are relying more on conservation pleas to everyone from homeowners to manufacturers and some of the biggest users, bitcoin miners.

Such requests aren’t new, but they are becoming more urgent as weather patterns become more extreme and construction of new infrastructure for power generation and transmission isn’t keeping pace with a trend of electrifying everything from stove tops to transportation.

California and Texas called for power cuts during heat waves this past summer, a tactic that California officials say kept the lights on. In New England, grid operators have floated the idea that such measures could be necessary this winter in the region, where surging natural-gas demand abroad threatens to reduce fuel available to generate electricity during extreme cold snaps.

Asking customers to voluntarily trim electricity use when the system is stressed and shift to using power at times when supplies are plentiful is called demand response. Varying electricity prices is another way to encourage power use at certain times, but grid operators and utilities also have programs that offer customers other financial incentives for voluntarily altering behavior.

In emergencies, pleas to slash power use become widespread to try to avoid rolling blackouts. Everyone gets asked to curtail power use, whether they’re part of a formal demand-response program or not.

“Extreme heat is straining the state energy grid,” California warned residents in a Hail Mary text message on Sept. 6, when much of the state was experiencing triple-digit temperatures. “Power interruptions may occur unless you take action.”

Within minutes of the text, electricity demand plummeted by around 1,510 megawatts for about an hour, trimming electricity demand by about 3% from that day’s peak, according to data from the California grid operator, though it noted in a report that it’s impossible to assess the precise impact of the text message. California avoided the kind of rolling blackouts that had hit the state during previous heat waves, most recently in August 2020 when utilities twice had to cut power briefly to customers.

This winter, all parts of the U.S. should have adequate electricity in normal conditions, but prolonged cold weather could pose a problem in some regions, according to an October report from the Federal Energy Regulatory Commission. The National Oceanic and Atmospheric Administration forecasts a mild winter.

“Extreme weather is not going away and across the country historically the system hasn’t been planned for the set of conditions we’re facing,” FERC Commissioner Allison Clements said at an October meeting.

In New England, extremely cold weather could strain the grid if more natural gas is burned to heat homes, reducing supplies available to generate electricity at power plants. The region has limited pipeline capacity and has struggled with supply for a decade. With its pipelines full, the region relies on natural-gas imports to bridge the gaps and competes with European countries for shipments of liquefied natural gas following Russia’s halt of most pipeline gas to the continent.

Governors and companies have been asking the federal government to allow for domestic LNG imports to the region, which would require waivers of the Jones Act, a law restricting the movement of ships between U.S. ports.

Utilities have been running drills in case the region’s grid operator orders them to roll outages among customers, said Joseph Nolan Jr., chief executive of Eversource Energy, which has electric, gas and water customers in Massachusetts, Connecticut and New Hampshire.

Mr. Nolan said he thinks customers would respond to calls for conservation in an emergency, especially after the dramatic response California received from its text alert. “That showed me just what the American people will do, you know, in time of need,” Mr. Nolan said. “I’m heartened by that.”

Americans aren’t used to thinking about whether electricity is available, after years of relatively cheap and reliable energy. Conservation requests during critical times are becoming a new reality. Predicting participation in a voluntary program and depending on it in a crisis is tricky. Consumer interest can wane after a number of pleas, analysts and companies say.

“It can definitely provide a lot of value, but there are times where it’s not going to be enough to save the day,” said Molly Jerrard, head of demand response in North America for European utility Enel SpA.

During the Sept. 6 energy crunch in California, Enel cut 101 megawatts of power use, about equal to the output of a small power plant, from a group of commercial and industrial customers across the state that had agreed to participate in demand response.

Under demand-response programs, businesses are commonly paid by their utility, aggregators or through a wholesale market program to be available for cuts year-round for a set number of hours and under certain conditions. It’s a system that provides them some planning certainty, compensates them for having to wind down operations and helps them reduce consumption when electricity costs the most.

The downside is business interruption, especially for companies with complex manufacturing processes that can take time to start and stop. Residential customers are generally paid with bill credits, and can opt out at any time.

Across the U.S., grid management is becoming more complex. Utilities and power generators are trying to balance plans to meet rising energy demands while investors and policies in some states push them to cut carbon emissions. Older coal and natural-gas plants have been closing. Renewables like wind and solar, which are intermittent unless paired with large batteries, may not be sufficient to offset the closures of traditional plants, grid operators have warned.

Some companies are bringing in residential consumers to demand-response programs, creating pools of thousands of households that together can deliver firm drops in demand. Customers might receive bill credits, gift cards or, in at least one instance, an invitation to a happy hour, as when an aggregator in Texas offered free drinks in the summer of 2021 to customers who arrived at a bar with a photo of thermostats turned to 80 degrees.

In Bakersfield, Calif., Melissa Bryson has been participating in a program of demand-response aggregator OhmConnect Inc. for four years and usually makes about $400 a summer in reward points and cash. During the heat wave in September, she also earned gift cards to Starbucks, Cold Stone Creamery and Amazon for slashing her energy use. Demand response is paid for by grid operators or utilities with funding ultimately coming from all users. The idea is that paying for occasional conservation is cheaper than spending billions to add plants that would be used only during demand crunches.

Not everyone is as motivated as Mrs. Bryson, though. Extended demand-response events eventually see participants opting out, said Travis Kavulla, vice president of regulatory affairs at NRG Energy Inc., which generates electricity and sells it to retail customers, largely in Texas and the Northeast.

Relatively few U.S. customers have devices like smart thermostats that can be automatically powered down during times of peak power demand. Ideally, voluntary demand-response programs would be automated and include things like pool pumps, electric vehicles and air conditioners. Brief shut-offs, timed use and measures like precooling a house before a demand spike could happen in the background so customers aren’t inconvenienced and don’t need to pay much attention to what’s happening with the electric grid, said Mr. Kavulla, adding that giving people the ability to override and opt out is key.

When retail customers are monitoring the grid and worried about outages, he said, “something has probably gone wrong.”

In Texas, the worst-case scenario unfolded when a bitter winter storm in February 2021 led to a massive failure of the electricity system, with power generation including coal, natural gas, nuclear and wind shutting down. Millions of residents were without power for days in freezing temperatures and businesses from chip makers to chemical plants were asked to go idle.

Texas grid officials see demand-response programs, which have been around for years, as one tool to help avoid that scenario again and see an opportunity with one of the most energy-intensive industries: cryptocurrency mining.

Bitcoin miners have flocked to the state because of low-cost power and business-friendly regulations. They consume vast amounts of electricity when operating warehouses of computer servers.

Miners say they benefit the grid in ways that might not be obvious. When supplies are abundant, Lee Bratcher, president of the Texas Blockchain Council, said the industry soaks up excess wind or solar power, encouraging more development of renewables. When supplies are scarce, they can quickly power down, he said.

Grid officials created a task force in April to study how to integrate miners into the system. Miners have to agree to participate in the voluntary demand-response program for it to work. Around 38,000 megawatts of bitcoin projects have applied to connect to the grid, nearly half of the electricity demand for the entire state on the hottest summer days.

At times, Texas cryptocurrency miners can bring in more money from reducing power use than they do from mining. Riot Blockchain Inc., which has a mining facility in central Texas, said it received $9.5 million in power credits in July and had net bitcoin sales of $5.6 million.

Riot Blockchain said that it benefits the grid and that by locating within the Texas grid, 30% of its fuel mix comes from renewable resources. “Our ability to shut down our operations at a moment’s notice contributes to grid stability by ensuring a supply of electricity during times of unusually high demand,” it said.

Barbara Clemenhagen, vice president at Customized Energy Solutions and a former board member at the state’s grid operator, said miners could help balance the grid when there is cheap excess electricity.

“There are a lot of times when we don’t have a lot of excess energy,” Ms. Clemenhagen said. “How do we manage around that?”

Oil-rich kingdom looks to mining sector as it steps up diversification plans

Saudi Arabia is planning to increase its phosphate fertiliser production to capture a quarter of the global export market as it seeks to expand its mining sector and become less dependent on oil revenues, said senior officials.

The kingdom, already among the world’s leading phosphate exporters, along with China, the US, Russia and Morocco, plans to increase capacity by 50 per cent to produce 9mn tonnes of phosphate fertilisers a year, said Robert Wilt, the chief executive of the Saudi Ma’aden mining company.

Phosphate is mostly used in fertilisers, with global demand expected to grow as the population rises, and with it demand for food.

“Over the last few years, we have been working steadily to increase our production by building a new world-class phosphate complex in Saudi Arabia,” Wilt said. The new project “will serve 24 per cent of the global export market for Diammonium phosphate and Monoammonium phosphate products”.

Saudi Arabia is the world’s largest oil exporter, and its economy has historically risen or fallen based on oil prices. The kingdom now wants to diversify the economy away from oil and attract more foreign investment under a plan named Vision 2030. The government has turned to its long neglected mining sector to reach its goal.

Wilt said the new phosphate mining complex has identified reserves for 60 years of production. “With new expansions of local rail infrastructure, we were able to increase our phosphate production capacity to transport larger amounts of material from our facilities in the north to our facilities in the east,” where it is processed before export, he said.

The expansion is part of a broader plan to intensify mining and draw in foreign investors, said Bandar Alkhorayef, Saudi minister for industry and mining. “Saudi Arabia is definitely underexplored but according to our calculation we spend probably less than 20 per cent of the global average in exploration,” said Alkhorayef.

“There was a decision actually by the government in the past to focus on oil and gas and leave minerals for later, and with Vision 2030, later has come,” he said.

The ministry is also looking to explore fully the western part of Saudi Arabia, which holds a government estimated $1.3tn in mineral reserves, based on 2016 prices when the assessment was made, he said.

Alkhorayef said the country was looking to more than quadruple copper production from 90,000 to 400,000 tonnes, and increase zinc production to 60,000 tonnes by 2025. The ministry is auctioning exploration licences for copper and zinc as well as lead and iron under a new law that is meant to streamline investments.

“When we designed the new investment law we took this into account to make it simple, the investor has to deal only with us the ministry as a regulator,” he said.

Olivier Pasquier, an expert on the mining industry in Saudi Arabia, said the new law passed in late 2020 removed some of the obstacles that had deterred investors.

“It’s too early to see whether it’s working, but they have good overview of what the best practices are worldwide and they’re trying to replicate it here,” said Pasquier.

“They extended the length of mining licences. The old Saudi law allowed 30 years and now they extended it to 60 years. You also have better access to funding, because the mining sector is capital intensive.”

Decision offers relief for cash-strapped developers struggling to complete projects

China’s central bank will extend a year-end deadline for lenders to cap their ratio of property sector loans, one of the strongest moves yet by Beijing to relieve pressure from the credit crunch roiling China’s real estate sector.

The People’s Bank of China’s extension of the “collective management system for real estate loans” has the potential to affect 26 per cent of China’s total banking loans, giving lenders and cash-strapped real estate developers breathing space as they fight to survive a historic property sector downturn.

According to a document signed off by the PBoC and the China Banking and Insurance Regulatory Commission, and viewed by the Financial Times, lenders now have an as yet unspecified amount of time to cap the ratio of their outstanding property loans to total loans at big banks at 40 per cent, and their outstanding mortgages as of total loans at 32.5 per cent.

The extension beyond December 31 is the most important in a batch of relief measures approved by central bankers and the CBIRC on November 11, according to the document.

“It’s a vital pivot,” said Yan Yuejin, research director of E-house China Research and Development Institute, adding that while pressure against excessive lending remained, the measures provided relief for commercial banks and leeway to issue new loans.

While some of China’s biggest banks have already met the deadline, many midsized and regional lenders were struggling to reduce the amount of property lending after years of heavy reliance on the sector. Smaller lenders need to meet the same requirements but the ratio varies.

Developers’ outstanding bank loans and borrowings from trust funds due within the next six months can be extended for a year, the document showed.

Regulators urged banks to also differentiate the credit risks between individual projects and developers as well as negotiate with homebuyers on extending mortgage repayments and credit score protection. Lenders are also encouraged to raise funds to buy out unfinished projects and turn them into affordable rental houses, the document showed.

These moves are designed to keep lines of credit open to real estate groups and enable them to finish incomplete developments. They come against a backdrop of hundreds of thousands of Chinese mortgage holders protesting this year over apartments that they had already paid for being left unfinished.

The package marked the latest sign that Beijing was having to backpedal on its sweeping property sector reforms amid fears of a credit crash and social instability.

The market has been stunned by a rising number of defaults and hurried asset sales by Chinese property developers. The pace of China’s new loans and total social financing have retreated faster than expected amid sluggish demand.

Evergrande, China’s most indebted developer with about $300bn in liabilities, last week took a $770mn loss following the forced sale of one of its most prized assets. It also plans to put up its Shenzhen headquarters plot for sale with an auction price starting from $1.06bn.

Pressure has mounted on China’s property developers over several years after financial regulators introduced “three red lines”, which cap the ratio of debt to cash, equity and assets on developers, in an effort to deleverage the property sector.

The severity of the property downturn, however, has sparked fears of a generational slowdown in Chinese economic growth. And it has increased the risk of contagion spilling into China’s financial local government institutions that have been heavily exposed to property sector lending.

The PBoC and CBIRC did not immediately respond to questions on Sunday.

Armanino and Prager Metis face scrutiny over Bankman-Fried’s bankrupt crypto empire

The collapse of FTX has thrown a spotlight on two US accounting firms that the cryptocurrency exchange said it had used to audit its books.

FTX claimed that its 2021 financial results had been audited by Armanino, one of the 20 largest accounting firms in the country by revenue, and Prager Metis, which styles itself the first accounting practice to open a headquarters in the metaverse.

The two firms are among several in the US to have touted expertise in digital assets in a race to win business from the burgeoning number of crypto companies, even as accounting rules for digital assets are often unclear and businesses remain in their infancy.

FTX founder Sam Bankman-Fried last year cast the audit of its financial results as a milestone, but the accounts were not made public and the names of the auditors did not emerge until the eve of its collapse into bankruptcy on Friday.

Forbes magazine said FTX provided it with “a trove of information on its operations, including most of the companies it did business with, when its last audits were and details on its regulatory licences” earlier this year when the publication was preparing a ranking of cryptocurrency exchanges. (FTX was ultimately ranked fifth.)

“Notably among FTX’s advisers and business partners was the New Jersey office of accountant Prager Metis CPAs, LLC and San Ramon, CA’s Armanino, LLP, which performed audits on FTX and FTX.US for fiscal 2021,” the magazine disclosed on Thursday.

Neither accounting firm responded to messages seeking comment about the scope of their work for FTX, or when they last issued an audit opinion.

FTX was brought down by a run on customer deposits at its international exchange, which followed revelations about the complicated relationships between the exchange and other entities in Bankman-Fried’s crypto empire. His trading firm Alameda Research this week owed FTX $10bn, according to people familiar with its finances.

Bankman-Fried blamed mistaken accounting of the exchange’s liquidity and leverage for the collapse.

FTX’s claims to have audited financials left numerous questions unanswered, said Jeffrey Johanns, a former PwC partner who teaches auditing at the University of Texas at Austin, particularly in light of revelations about the complexity of its organisational structure.

“If there was some form of assurance by an accounting firm, what type of assurance was it, how extensive was it and how many entities were covered?” said Johanns. “Especially if there are intercompany transactions, it would be a tough thing to audit.”

Prager Metis, which has more than 100 partners and 600 staff across 24 offices worldwide, says its clients include private and public companies in industries ranging from hospitality to manufacturing.

A report in August by the Public Company Accounting Oversight Board, regulator of the US audit profession, said its inspectors found deficiencies in all four of the public company audits carried out by Prager Metis that they looked at. The firm told the PCAOB it was working to fix the issues.

The group has a digital assets practice it says provides services to crypto exchanges, issuers of non-fungible tokens and crypto hedge funds, among other clients. It has also sought to offer advice to businesses setting up operations in the immersive virtual worlds known as the metaverse.

“There is a tremendous need for financial expertise and resources in the evolving digital world,” chief executive Glenn Friedman said in January, when Prager Metis opened a “headquarters” on the metaverse platform Decentraland. The firm is sponsoring an event at a music festival on the platform this weekend.

In a now-deleted June website post, which showed Prager Metis and FTX staff at a Yankees baseball game, the firm said it was “proud to support FTX US” and was “looking forward to our next adventure together”.

Armanino has also pushed heavily into work for digital asset and cryptocurrency businesses, helping it become one of the fastest-growing US accounting firms, with $458mn in revenue in its last financial year, according to Accounting Today.

The firm has been heavily marketing technology that allows cryptocurrency exchanges and other businesses to demonstrate that digital assets are safe, with real-time verification for customers. An Armanino Twitter account was promoting the product on Tuesday as the unravelling of FTX captivated the industry.

Last December, the same account had tweeted approvingly in response to Bankman-Fried’s testimony before the House of Representatives financial services committee, when the FTX founder pushed lawmakers to standardise crypto regulation and nurture innovation.

“Working on all our behalf today,” the account wrote.