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Green means Money. For some.

For some, creating an “environmental” market is pretty much a license to print money, and this is what a small clique of money men did when they created a market called Global Warming, which would bring the money rolling in via the launch of their associated product; Carbon Credits.

Climate Change is hot news right now, so they’ve engineered it well, what with workers and students holding Climate Strikes in a futile effort to force world governments to “do something” about climate change/global warming, but as has been discussed in a previous post, much of what happens on Earth, temperature wise, is governed by solar activity and no government, no matter how committed, can control the Sun. They can do their bit to encourage recycling, to reduce landfill and to penalise blatant polluters of our air, waterways and the land itself, but for as long as the Sun shines, the temperature and the climate on Earth will do its own seasonal thing.

Which leads to the question; why do we need a global emissions trading scheme? The short answer is, we don’t, but green does mean money and anything bearing the “Environmental” stamp has the potential to generate a lot of it.

Hence the Carbon Bubble. Emissions Trading is a market-based scheme where the Carbon Market tracks emissions under cap-and-trade schemes. It is a vastly overpriced scheme where Carbon Credits are disguised as an “environmental plan” and is a virtual repeat of the commodities market. It will allow world governments to mandate rises in pricing as it will place a limit (cap) on coal plants and natural gas distributors on the amount of carbon emissions (greenhouse gases) they are permitted to produce per annum. Should they generate beyond their allotment, they will be able to purchase “allocations”, also known as credits, from other companies that have an excess of credits due to having produced fewer emissions. Which all sounds well and good, except the cap will be regularly lowered, which will result in the availability of carbon credits getting scarcer, and that’s not so good. Basically, cap-and-trade is a scheme that is carbon tax structured, and which will be profitable only for those private interests who will collect the revenue.

In 2004, an $18 billion firm named Generation Investment Management (GIM) was founded by Al Gore, founder and current Chair of The Climate Reality Project. The co-founder is former Goldman Sachs Asset Manager, David Blood. All about “sustainably focused” investments, the company raised a profit of almost $218 million between 2008 and 2011. Headquartered in London, GIM now manages assets of around $22 billion and as of 2019, has raised $1 billion for its latest private equity fund. The third and largest of its similar funds is Generation IM Sustainable Solutions Fund III, which plans to invest $50 million and $150 million each in companies aiding the health of the planet and/or individuals. The demand to invest in a sustainable manner is growing, especially throughout Europe, despite the fact that the definition of what that actually means can vary (a definition that regulators in Europe want to look at more closely). Basically though, its focus in on “sustainable investing” and demonstrating the long-term commercial benefits. Or more plainly, it’s all about the money. David Blood is part of initial working group that brought about the United Nations Principal of Responsible Investment (UNPRI), which relates principally to the interests of “environmental, corporate and social governance”, which means it nurtures the longtime interests of financial markets and investors etc.

In 2005, The EU Emission Trading Scheme was introduced and Goldman Sachs participated in this scheme from its inception as a market maker in carbon credits.

The year 2006 saw the release of Al Gore’s controversial book, An Inconvenient Truth which created worldwide concern (fear) about climate change and global warming, and did much to boost the carbon investment markets, which was good news for Goldman Sachs. In the same year, Al Gore’s film of the same name, was released by Participant Media, a company owned by wealthy businessman, Jeffrey Skoll, first President of eBay and friend of Al Gore. Goldman Sachs is eBay’s investment bank. Anyway, by 2008, Al Gore was in a position to invest $35 million into hedge funds and private partnerships through a company named Capricorn Investment Group, a Palo Alto company also founded by Jeffrey Skoll.

But after the initial panic, perhaps the shock wore off and the market stalled because in 2017, Al Gore released a sequel to his film. It didn’t create anywhere near the impact of its predecessor though, which may be an inkling that more people are beginning to see through the ruse. Because that’s what it is really.

Come 2018 and the Carbon Disclosure Project (CDP) introduced a new index created by Euronext, the largest stock exchange in Europe (6th largest in the world) with roots that go back centuries, apparently. The index, Euronext CDP Environmental Finance is exclusively licensed to Goldman Sachs. Carbon Credits are currently trading at $11 to $20 per credit.

In September 2019, Goldman Sachs released a report which claimed “rising temperatures would lead to changing disease patterns, more intense and longer lasting heatwaves, more destructive weather events and pressure on the availability of water for drinking and agriculture.” It also warns that natural ecosystems would be damaged and human health, food and drinking systems would all come under pressure as well. Hence Goldman Sachs’ Environmental Policy Framework. They are an underwriter for “Green Bonds” and into developing an Environmental Commodities Market. Their Centre for Environmental Markets is where they partner with other corporations, academic institutions and non-governmental organisations to “unlock” lucrative environmental markets.

Well, it stands to reason those who stand to make the most money out of carbon trading will do whatever it takes to keep the ball rolling, as there’s so much money to be made. But not by you and me.

So it’s never really been about “saving” the planet. It’s always been about wealth and how much of it could be raked in by a few savvy money men who trawled through all things “environmental” until they hit on a way to create a whole new enterprise, which they then launched upon the world and turned to their own advantage…at our expense. “Green” is really lucrative for some.

But not us.

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The Carbon Asset Bubble

Some people are very good when it comes to spotting a gap in an existing market and it can often lead to a great idea, which evolves into creating a product to fill it. If the product is sound it should sell well, but how big a profit margin it will create will depend on the size of the market to which it is being pitched.

Okay, so that’s how many products are launched onto the market, we all know that, and in most cases the products are going to be useful to a specific consumer and the customer base will build itself in time, via advertising campaigns and  word of mouth. Nothing wrong with that.

But what do you do if you hatch an idea for something that, as yet, no one has heard of, but has the potential to go global and make you a huge amount of money? Well naturally, you are going to want to sell it. In order to do that though, you are going to  have to create what appears to be a market, one that will allow you to promote the bejaysus out of it and if you get all those things right, you stand to make more millions than you can poke a stick at.

This is not hard to do however, if you have been manipulating money markets for decades, know the right people and have the nous to engineer a global situation that is guaranteed to grant you a customer base world wide.

Anything to do with the environment is big business, which can be measured in billions of dollars, which with encouragement, has naturally attracted a lot of “environmental investment” which has been encouraged by a swathe of “environmental reports” which have convinced almost an entire generation that the world is heading for a climate disaster. And there you have a very big market despite the Intergovernmental Panel on Climate Change (IPCC) owning up that their theoretical simulation models have greatly overstated the Earth’s sensitivity to CO2, and have also admitted that global temperatures have been flat for at least  sixteen years (as at 2013) despite an increase in atmospheric CO2 levels.

But no matter, as I said, some people are really savvy with spotting money making opportunities and one of them, who spotted and plotted the Carbon Asset Bubble, and has fed it since its infancy, is Al Gore. To quote him, “As soon as carbon has a price, you’re going to see a wave (of investment) in it…”

Hence carbon markets. Goldman Sachs conceived the carbon credit market and are also behind the cap and trade system. Carbon brokers/traders have been feverishly gearing up for a futures market and carbon exchanges are promising there are billions to be made in potential profit.  Hence the concept of climate change represents opportunities for businesses and many private sector companies have taken advantage of emerging low carbon opportunities by embedding an internal carbon price into their business strategies. It’s a popular strategy and the momentum is expected to continue.

The carbon credit market is a virtual repeat of the commodities-market cap and trade program which is where carbon emissions are capped at a politically-determined level. Users and producers of coal, oil and natural gas then buy, sell and trade their allowance to emit a given amount of carbon dioxide. This, in turn, is guaranteed to push up the price of coal, oil and natural gas, and the price increase will be employed as a means to compel consumers to switch from the more conventional energy sources to alternative, less reliable, but more expensive forms of energy. It is an economically damaging, vastly overpriced system, and currently the most popular method of regulating carbon dioxide emissions.

The cap and trade system will increase the price of energy but it will not work to reduce omissions, and Europe’s Emission Trading Scheme (ETS) has not been welcomed by all of the world’s leaders, as those opposing it have recognised how negatively it will impact on people at the lower end of the income scale. It also carries a high potential for market manipulation and fraud. But it will make those who got in on the ground floor very wealthy, which is why carbon emissions trading is still very much on the table and those who created it will work hard to keep it there.

In 1992, the term Sustainable Development was coined at the UN Rio Earth Summit. In 1999, Dow Jones launched the Dow Jones Sustainability Index (DJSI), and in 2000, the UN Millennium Development Goals were announced. And in 2003, Al Gore met Head of Goldman Sachs Asset Management, David Blood.

And the Carbon Asset Bubble evolved from there.