----- Forwarded Message ----- From: John Fullerton <[email protected]> To: Robert Searle <[email protected]> Sent: Monday, 19 December 2011, 23:15 Subject: Time to Plan: the Climate Crisis is Here To forward this email, click here. Time to Plan: the Climate Crisis is Here “This is what the fight over Stranding Assets will look like. The spotlight on “stranded assets” is growing brighter, and that is good. The idea was brought to our attention when Carbon Tracker released their report, “Unburnable Carbon,” on the growing asset bubble in global fossil-fuel-company public shares, and called for greater transparency and regulatory oversight. Our take on the issue was to highlight the systemic “$20 Trillion Big Choice” between burning the world’s proven fossil fuel reserves already on company and sovereign balance sheets, and preserving a planet that can support life as we know it.” Read more at the Future of Finance Blog. ESG and the Problem with Business as Usual We were very pleased to read Al Gore and David Blood’s “Manifesto for Sustainable Capitalism” in the WSJ last week. It called for “a framework that seeks to maximize long-term economic value by reforming markets to address real needs while integrating environmental, social and governance (ESG) metrics throughout the decision-making process.” Companies that integrate sustainability into their business models and investors who evaluate them on that basis, the manifesto claims, are finding their profitability enhanced over the longer term. We only wish Gore and Blood had focused a bit more, and in blunter terms, on the dire consequences of operating under “business as usual” and on the deeply flawed valuation methods that are used to model it. We talked about these last week with Steve Waygood, Director of Sustainable Research at Aviva Investors. He pointed out that by continuing to use discounted cash flow and other short-term focused valuation tools that ignore our biocapacity deficit, companies and investors are setting up the global economy for a period of disruption that will make past credit crises look like a walk in the park. As the sixth largest insurance company in the world and an asset manager with over £249 billion under management, Aviva is far more concerned, Waygood reported, about the market impacts of a natural resources crunch than of another credit meltdown. So should we all be. Read more at This Week at Capital Institute. ________________________________ Occupy Economics As a graduate of a so-called "heterodox" economics school and witness to the Asian economic crisis of 1997, the Occupy Wall Street movement resonates with me in many ways. Author of Adam's Fallacy and my former professor Duncan Foley once explained that "the role of heterodoxy in this long-standing division of intellectual labor is to make mainstream economists as uncomfortable as possible." So I was glad to see Harvard econ students challenge the dominant canon of modern economics in the recent walkout. But what about professors? Read more from Jason Chang about the role of alternative economics in OWS here. What We're Reading This new book by Peter Ressler and Monika Mitchell draws on confidential conversations to reveal what went wrong with the mortgage market and what needs to change from insiders themselves. This is the first book in this area to to include observations from firsthand insiders rather than just reporters with third-hand accounts. Conversations with Wall Street: The Inside Story of the Financial Armageddon & How to Prevent the Next One ________________________________ Comment of the Week “So, our new reality in the 21st Century is that we have the Earth, and it is well and truly ours, but it is all we have. Our challenge is to innovate cutting edge technologies for value creation, capital formation and wealth distribution that are purpose-built to deliver sustainable prosperity without geopolitical expansion.” -Tim MacDonald, 3ME ________________________________ Quote of the Week “The scientific reality of climate change must, for progressives, occupy a central place in a coherent narrative about the perils of unrestrained greed and the need for real alternatives.” -Naomi Klein, Capitalism vs. the Environment To unsubscribe from this email list, click here. 73 Arch Street, 3rd Floor Greenwich, CT 06830 United States