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Project Climate Fear: Bank Of England Alarmist-In-Chief Raises Climate Alarm In Canada

July 16, 2016
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By Paul Homewood

 

h/t A C Osborn

 

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http://www.thegwpf.com/project-climate-fear-bank-of-england-alarmist-in-chief-raises-climate-alarm-in-canada/

 

Mark Carney has tried to resurrect his Project Fear, but this time over climate change, and not Brexit.

GWPF report:

 

 

It’s 8 a.m. Friday. While the world economy flaps in the wind of central-bank imposed zero interest rates, as Brexit threatens the very existence of the European Union, as some banks and nations teeter on the brink of insolvency, as climate skeptic politicians grab headlines in Britain and the United States, there on stage at a Toronto Board of Trade breakfast event sat Bank of England Governor Mark Carney, the world’s Alarmist-in-Chief, basking in Liberal adulation and fielding lob-ball questions in which he is asked to rehash his notes from a speech he gave last September on the subject of climate change and financial stability.

No Brexit questions, thank you. Nothing about the Bank of England’s latest interest rate incoherencies, and certainly not a word about Prime Minister Theresa May or Boris Johnson, Britain’s new foreign secretary who holds views that are the direct opposite of Carney’s on any number of subjects, from Brexit to climate science. Not a word about the British pound or the British economy and their remarkable failure to self-destruct as Carney and the Bank of England had warned prior to the referendum.

No conflict at all, in fact. Carney was introduced as the former governor of the Bank of Canada “whose calm and steady hand helped guide our country, and arguably the global financial system, on the heels of the global financial crisis.” And today “the world again is looking to him as we face uncertainty in the wake of Brexit.”

And also now, apparently, the world continues to turn to Mark Carney for climate change salvation.

Looking tanned and fit, Carney then engaged in mutual climate policy admiration with Catherine McKenna, Canada’s minister of the environment and climate change, who felt it necessary to remind the audience that they were sitting in downtown Toronto on territory that belongs to First Nations. Carney’s message, like McKenna’s, is that climate change poses severe century-long risks to the economy that must be addressed now by the world’s corporate leaders.

From too much short-termism, the business world is now being asked to engage in extreme long-termism, planning for 2030 and galaxies beyond.

Carney’s September speech to Lloyds of London, already viewed by many as inappropriately political climate alarmism from a central banker masquerading as financial common sense, set in motion an international movement to impose long-range climate predictions on short-term investment decisions. As climate alarmist-in-chief, he warned of “stranded” oil, coal and gas assets as climate policy shifts, putting at risk trillions of dollars in value and threatening financial stability.

As he did with Brexit, Carney portrays climate change as a potential financial catastrophe unless steps are taken now by the world’s financial players to integrate climate and carbon risks into all their decision-making and financial disclosure. For example (in case there were any complacent corporate directors in the audience) Carney raised the prospect of directors’ liability over climate change. With no information, he asked, “When would you know with a reasonable degree of certainty about the potential damage of the activities of the corporation?” Would failure to know send directors to jail?

The broad concept seems simple enough. “From a financial regulatory perspective,” as Carney explained it Friday, “the issue we have is that investors, credit providers, management, other stakeholders, can’t make assessments today about how well prepared companies are.” How ready are they for carbon pricing and other regulatory mega-policies that could dramatically alter the economic structure of the world?

One of Carney’s approaches, repeated in Toronto, is to warn of possible “Minsky moments.” If corporations and financial institutions were to reveal all climate risks, the world could avoid “a climate ‘Minsky moment’” — a reference to the work of economist Hyman Minsky who tried to understand the causes of sudden massive financial collapses and crashing asset values. Could carbon policy-making and climate change produce another Minsky moment?

If corporations tabulated, understood and disclosed their carbon and climate risks, the financial system would be ultimately safer, Carney says.  If corporations and the financial system were assessed via a market for information around climate, it would allow “feedback between the market and policymaking, making climate policy a bit more like monetary policy.”

That note, to central bank watchers, may not be all that comforting. The world’s monetary policymakers, with all the credit and institutional information at their disposal, have a dismal if not catastrophic record of anticipating Minsky moments. Monetary policy, moreover, has a short-term horizon of a few months to a few years and seldom gets it right. To expect corporate managers to be able to analyze, forecast and disclose risks that a business might face over decades is a wild stretch.   Over time, half the public institutions in existence today could well be out of business in half a century for any number of reasons.

http://www.thegwpf.com/project-climate-fear-bank-of-england-alarmist-in-chief-raises-climate-alarm-in-canada/

 

Meanwhile, as WUWT reports, in a separate Financial Post article on the Carney speech, he reveals the real motivation.

 

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TORONTO The trillions needed to fund global carbon reduction commitments in the coming years is a big opportunity for investors, Bank of England Governor Mark Carney said Friday in a speech to Toronto’s financial community.

Carney, formerly the Bank of Canada governor, spoke at the Toronto Region Board of Trade with Catherine McKenna, the minister of environment and climate change. He said that given the enormous funding needs for clean infrastructure — he estimated at somewhere between $5 trillion and $7 trillion a year — investment opportunities will abound.

http://business.financialpost.com/investing/climate-change-initiatives-a-7-trillion-funding-opportunity-for-capital-markets-carney

 

 

 

As I have commented before, political pressure to decarbonise actually poses a huge and systemic threat to the global economy. It is this that Carney should be addressing, and not some imaginary problem.

While he whittles on about climate risks, what on earth does he expect oil companies to do?

Start cutting production? Of course he does not. If they did, it would plunge the global economy into a depression that would make the 2008 one look like a vicarage tea party.

Maybe stop new drilling then? The effect would be the same, if not as precipitous.

13 Comments leave one →
  1. AlecM permalink
    July 16, 2016 3:40 pm

    His wife, like Cameron’s, is a deep greenie.

    Most men when nagged, adopt the line of least resistance……..

  2. A C Osborn permalink
    July 16, 2016 3:48 pm

    What they want is to make a great deal of money and move ever closer to UN Agenda 21 and “Sustainability”.
    And they don’t care who suffers for them to attain it.

  3. July 16, 2016 4:30 pm

    The merry-go-round between Goldman Sachs and the EU is very worrying. Apparently they have just taken on Barroso the ex president of the EU. Carney an alumni is still peddling their line.

  4. Joe Public permalink
    July 16, 2016 5:00 pm

    Perhaps Mikey Mann could write a paper on Britain’s National Debt, & disappear it?

  5. Green Sand permalink
    July 16, 2016 8:10 pm

    It would appear the Bank of England is headed by a Canadian version of Corporal Jones.

    Just what the UK does not need right now.

    • July 17, 2016 7:40 am

      Under a points-based immigration system, Carney would not have been allowed into the UK. He should be sent back to Canada forthwith before he does even more damage. I cannot see any reason why May would want to keep him in his highly over-paid post.

  6. dearieme permalink
    July 16, 2016 8:50 pm

    I thought it was an enterprising decision to appoint a Canadian to the BoE. Pity it was this Canadian.

  7. roger permalink
    July 16, 2016 10:15 pm

    Every time Carney makes pronouncements to the world, the value of the pound and FTSE indices fall.
    Far from reassuring and stabilizing markets, his interventions cause alarm and negativity.
    That these effects have to date been quickly neutralized by the rational analysis of saner heads within markets does not mean that we can tolerate such a loose cannon randomly firing sour grapeshot onto the decks of world opinion and we look to Phillip Hammond to spike him and then fire him in short order.

  8. David Ashton permalink
    July 17, 2016 10:06 am

    As I have said elsewhere some time ago: you can take the man out of Goldman Sachs but you can’t take Goldman Sachs out of the man.

  9. July 17, 2016 1:37 pm

    Tip : UK heading for Gas storage crisis Telegraph
    “Centrica said it has been forced to shut down a key gas storage facility until next spring.

    Centrica’s Rough site accounts for more than 70pc of the UK’s total gas storage capacity, and can provide about 10pc of peak winter gas demand.”

    • July 17, 2016 1:44 pm

      Minimum of 42 days maintenance ..hmm that’s no the whole summer never mind winter
      Reuters : “The ability to buy LNG from the U.S. (and other places) probably means that (Britain) will be able to manage through a normal winter, but the markets could get a bit jumpy if it is a cold winter and we have no Rough,”

    • AlecM permalink
      July 17, 2016 3:53 pm

      Looks like the central power producers are going on strike in another key area. The lesson for greenie politicians** is going to be be even harsher than I had thought was being planned.

      **Inner cities without energy for weeks on time; martial law, hospitals operating by candle light, schools closed etc. etc..

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