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Climate change, environment

First Hand Insights on Climate Change Impacts in Bangladesh: An interview with Susmita Saha

This is an updated reprint of a 2016 interview.

In February 2022 the IPCC (International Panel on Climate Change) released a dire warning. (1) “This report is a dire warning about the consequences of inaction,” said Hoesung Lee, Chair of the IPCC. “It shows that climate change is a grave and mounting threat to our wellbeing and a healthy planet. Our actions today will shape how people adapt and nature responds to increasing climate risks.”

“The world faces unavoidable multiple climate hazards over the next two decades with global warming of 1.5°C (2.7°F). Even temporarily exceeding this warming level will result in additional severe impacts, some of which will be irreversible. People and ecosystems least able to cope are being hardest hit, said scientists.”

This nightmare is becoming all too real. In April 2022 temperatures on the Indian subcontinent have reached new highs well before the start of the summer season. (2) “Temperatures in India remain high amid ongoing heat waves that have plagued the country with dry, sweltering weather since early spring. The India Meteorological Department (IMD) stated that its March maximum temperatures were the highest in nearly a century and a quarter, and rainfall was only running about a quarter to a third of normal.”

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interest rates, retirement, risk management

Housing Crisis 2.0

In 2008-2009 the nation was struck by a crisis in the mortgage credit markets that had repercussions for the next 15 years. The Great Financial Crisis (GFC) caused many people to lose their house or their job, or both. Many have yet to fully recover.

Fast forward to 2020-2022 and the housing situation in the United States is very different… Housing prices are rapidly rising and mortgage rates are headed higher as the Fed begins to raise rates and tighten financial conditions in an effort to fight inflation. Since WW2 housing has been a bastion of wealth building for the middle and working class. As an asset people were able to benefit from its appreciation and stability over time. Contrast this to the fact that many in the middle or working class have very little saved in their 401ks compared to the wealthier 10% of society; The wealthiest 10% own 89% of stocks, nearly $36 trillion. (1)

As housing prices and mortgage rates rise, younger buyers who are starting out in life are increasingly being priced out of the market. The University of Michigan Consumer Sentiment Survey takes a monthly snapshot of buying conditions for housing. The February 2022 figure came in at 36, a 42 year low. By way of comparison, the survey printed 70 in January 2020 and 56 in 2008 during the GFC.

So, the question is why are housing prices, as well as rents, continuing to rise with consumers largely sidelined?

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Climate change, economy, environment, ESG, retirement, risk management, Socially Responsible Investing, SRI

How Will COVID19 Potentially Affect the Climate Change Debate?

As the severity of the COVID19 pandemic became clear to leaders in China in early 2020, the Chinese Communist Party announced the quarantine of over 800 million people and effectively closed down the economy of China. One of the effects of this shutdown was a dramatic drop in carbon emissions and air pollution.

Paul Monks, professor of air pollution at the University of Leicester, predicted there will be important lessons to learn. “We are now, inadvertently, conducting the largest-scale experiment ever seen,” he said. “Are we looking at what we might see in the future if we can move to a low-carbon economy? Not to denigrate the loss of life, but this might give us some hope from something terrible. To see what can be achieved.” (1)

“What I think will come out of this is a realization – because we are forced to – that there is considerable potential to change working practices and lifestyles. This challenges us in the future to think, do we really need to drive our car there or burn fuel for that,” said Monk.

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economy, income, interest rates, retirement, risk management

“The Fed is going to break things…”

In the last week of March 2022, the Federal Reserve revealed a regime change in their policy. The Fed moved from balancing jobs and inflation and being patient to a new policy of aggressively raising rates in order to fight inflation, regardless of its impact on the economy.

On March 16, 2022 the Fed raised rates for the first time in several years 25bps. The move was well broadcast and expected by markets for many months. Many critics of the Fed have complained the Fed has waited too long to raise rates. In 2020 the Fed lowered rates and engaged in massive quantitative easing (“QE”) in order to pull the economy out of the recession that resulted from the COVID shutdown.

On Monday March 20, 2022, Chair Powell appeared at the NABE (National Association for Business Economics) conference; his comments revealed a clear change in priorities at the Fed, and some insight to policy going forward. (1) In his statement he shares that “Supply chains are healing, but we are now seeing new COVID related supply disruption from China. The healing will come in time as the world settles into a new normal, but the timing and scope of that relief are highly uncertain. In the meantime, the Fed will be focused on trying to reduce price pressures.

As the magnitude and persistence of inflation became more clear at the end of 2021, the FOMC pivoted to less accommodative monetary policy. I believe these policy actions, and those to come, will help bring inflation down to 2% over the next 3 years.“

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Climate change, economy, environment, ESG, retirement, risk management, Socially Responsible Investing, SRI

Mixed Economic Signals, Debt Issues and Fossil Fuel Companies

Several years ago, Bloomberg Businessweek did a bio pic on Hank Paulson, Bush’s Treasury secretary who served during the Financial Crisis of 2008. After reviewing the events that led to the Crisis, connecting the dots, and seeing the impact of what happened, Paulson had this to say at the end of the film…

“The whole reason I’m doing this, is not because I want to look back, but because I have increasingly come to the view that it’s important that there be a historical record for those that come after me, so we don’t replay this movie all over again.” (1)

Fast-forward to November 2019, and we saw many positive and negative conditions developing that raised questions about the stock market and the health of the US economy.

Since the summer of 2019 financial conditions have noticeably weakened as the trade war with China has started having a significant economic impact. American and Chinese officials have spoken publicly that progress is being made. Hopes of a trade deal had driven equity markets higher, but as of December 2019 there is still no deal.

The trade war had caused a real decline in business investment and optimism. A CFO survey in the Fall of 2019 showed, “U.S. business optimism dropped this quarter to its lowest level in three years, according to third-quarter results from the Duke University/CFO Global Business Outlook. A majority of CFOs expect a recession to start before the presidential election.” (2)

This lack of business confidence had slowed growth in the economy and motivated the Fed to cut interest rates several times this year. This was all before COVID crippled the economy in the Spring of 2020…

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income, retirement

First Steps to Retirement Planning

Many people are paralyzed into inaction when they start thinking about the challenge of planning for retirement. The truth is there are a few first steps anyone can take on their own to improve their chances for success.

A first step is to determine how much income you can expect to receive from social security. In years past SSA would mail annual statements for people to see their expected benefits. Things have changed… go to google and search for “my social security”. You will create an account and through this account be able to determine your numbers.

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charitable giving, life insurance, protection, Taxes

A beloved relative has passed away and left me an inheritance… What should I do?

I have had several clients experience the passing of a beloved family member in the past 6 months. All ages, all walks of life. To a person they struggle with the desire to have their father or spouse or daughter back with them again, and how to move forward without them.

I have lost both of my parents; my mother passed away at 42 from lung cancer. I know the pain they suffer. Looking back, her illness and death really hurt my father and younger brother financially. She didn’t have life insurance. Due to the illness many of the family’s assets were exhausted. My father and brother did the best that they could do, but it was a difficult journey.

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economy, interest rates, retirement, risk management

March Jobs Day – “There is a huge fog that is blanketing future economic outlooks.”

The geopolitical crisis of the past month has changed the global economic roadmap ahead. Russia’s invasion of Ukraine has disrupted flows of commodities and driven up prices stoking already high inflation. As a result…

Tom Keene points out “We are not focused on payrolls…” (1)

March 4, 2022 was the release of the jobs report for February. The estimate for new jobs is for 421k, and a 3.9% unemployment rate.

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Climate change, environment, risk management, Socially Responsible Investing, SRI

“We are talking about a genuine existential issue”: An interview with Ian Dunlop, Sustainability Consultant based in Australia

This article is an update from an interview in 2016 with more recent comments from Ian Dunlop and James Cox.

Ian Dunlop’s life has been spent in the center of the carbon economy and the climate change debate.

His bio from LinkedIn chronicles his background…

Ian Dunlop has wide experience in energy resources, infrastructure, and international business, for many years on the international staff of Royal Dutch Shell. He has worked at senior level in oil, gas and coal exploration and production, in scenario and long-term energy planning, competition reform and privatization. He chaired the Australian Coal Associations in 1987-88. From 1998-2000 he chaired the Australian Greenhouse Office Experts Group on Emissions Trading which developed the first emissions trading system design for Australia. From 1997 to 2001 he was CEO of the Australian Institute of Company Directors. Ian has a particular interest in the interaction of corporate governance, corporate responsibility and sustainability. An engineer from the University of Cambridge (UK), MA Mechanical Sciences, he is a Fellow of the Australian Institute of Company Directors, the Australasian Institute of Mining and Metallurgy and the Energy Institute (UK), and a Member of the Society of Petroleum Engineers of AIME (USA). He is Chairman of Safe Climate Australia, a Director of Australia 21, Deputy Convenor of the Australian Association for the Study of Peak Oil, a Fellow of the Centre for Policy Development, a Member of The Club of Rome and a member of Mikhail Gorbachev’s Climate Change Task Force. He advises and writes extensively on governance, climate change, energy and sustainability.

He grew up in the middle of the oil and coal business, and over the years he has come to his own conclusions about climate change and the impact it will have on humanity’s future. I interviewed him mid-May 2016 to learn more. I wanted to learn more about what can be done about climate change, what the role of business is, and what the impact on the economy is.

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Climate change, economy, retirement, risk management

Ukraine, the Global Framework and Climate

On February 24, 2022, Russia invaded Ukraine. A number of times today I heard the phrase, “this changes things fundamentally.” The question is what does it change and how do we move forward? In particular, what does this mean for the climate crisis?

The climate crisis requires a level of international cooperation that has never been seen. The breakdown of the framework that came out of Glasgow and COP26 is the latest example of the challenge we face.

Events in Ukraine underscore deeper systemic issues that we need to address in order to be effective on an international scale.

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