BP Spills Coffee

Hat-tip to BoingBoing

Green or Greed Investment Bank?

I wonder whose problem(s) would be solved by the public sector 'green investment bank' being touted by both the Tories and Labour. 

I mean, do you believe the British Private Equity and Venture Capital Association is a staunch advocate of completely open and transparent financial markets? Or do you think it could be helpful to have a captive investor on which to off-load one's less than spectacular speculative green investments as a last resort?

Perhaps more importantly, would the creation of a public sector green investment bank allow or encourage individuals to buy-in to alternative energy projects, financing them in the process?

The current "problems" in the financial services markets - excessive fees and bonuses, lack of transparency, poorly understood products, the credit and pension crises - are the result of the sort of institutional tinkering epitomised by the proposed 'green investment bank'. We funnel investment opportunities and funding into a zone in which relatively few firms are permitted to operate. The results are increasingly complex products, less transparency, increasingly concentrated risk and less competition.

This situation won't change until the clear objective of the regulatory regime becomes the delivery of simple, low cost financial products that are accessible to us all. Rather than vainly trying to educate an aging population to become more and more financially literate, we need to vastly simplify the process for the average individual to invest/save in a fully diversified way.

Surely the successful investment firms of the future will be the ones who race each other to demystify and simplify the funding/investment experience, rather than those who enter into cosy, self-serving institutional arrangements like this one.

The Natural Economy - Sustainable Capitalism

In this age of economic and environmental meltdown, it's worth considering what "sustainable capitalism" means to you. And whichever way you plan to vote (if at all) in the next UK general election, Zac Goldsmith's book, The Constant Economy, is worth reading as part of the process.

Goldsmith rightly cites as "an extraordinary statement" Neil Armstrong's belief that 'the important achievement of Apollo was that it demonstrated that man was not forever chained to this planet'. There may be few better examples of man's apparent contempt for his environment than incinerating vast quantities of fossil fuel to escape it. Perhaps this is harsh, but the Apollo missions do seem to mark an acceleration in what we now recognise as a wasteful, exploitative energy binge.

The Constant Economy provides a concise summary of what we've learned since the Apollo years about both the scale of our environmental problems and potential ways to address them. Importantly, Goldsmith calls for greater focus on addressing the root causes, rather than merely some of the causes or the symptoms. A key starting point is actually valuing the various elements of our environment and including that value in our growth and accounting metrics.

I hope I don't do Goldsmith or his book any injustice in listing the gist of most of the policies below. It would be interesting to see them voted upon in much the same way as Power2010 is deliberating over a list of wider policies to develop a Top 5.

1. Tax pollution, waste and the use of scarce resources - inappropriate or polluting agriculture should not be subsidised;

2. Promote more direct democracy - ballot initiatives, referenda and recall initiatives;

3. New food technology (like GM) should not be able to be released without proof they do no harm;

4. The public sector should buy sustainable, local produce;

5. Food growing should be part of the school curriculum;

6. Agricultural subsidies should reward farmers for land management that benefits society, but is unrewarded by the market;

7. Planning policy should favour walkable town centres and maintaining the viability of independent shops;

8. There should be a stronger code of practice for supermarkets with more than 8% market share;

9. There should be less prescription and red tape for primary producers who meet quality standards;

10. Nations (particularly EU member states) should be able to insist that imported food meets the same standards as locally produced food;

11. Antibiotics should only be used to treat sick animals, rather than boost meet yields;

12. We should identify and promote GM-free produce/regions;

13. We should create more marine protected areas to aid re-generation of fish stocks;

14. We should ban the use of destructive fishing methods;

15. We should limit industrial fishing catches;

16. There should be higher standards for fish farms;

17. We must establish the truth about oil reserves, and extraction costs vs price;

18. We should require power generation to occur closer to where it is needed, and facilitate community-level generating capacity; appropriate micro-generators should be a permitted development, rather than require planning permission;

19. There should be a "feed-in tariff" to ensure the export price of sustainably-generated electricity stimulates investment in the alternative methods;

20. We should encourage the formation of renewable energy investment funds;

21. Reduce subsidies for fossil fuels in favour of renewable energy;

22. Invest in high speed rail and hold off on airport expansion;

23. Make green cars cheaper;

24. Encourage only biofuels that generate a net carbon saving, are not generated at the expense of valauble habitat or at the expense of food production or security;

25. Transport policy should favour cycling, buses and a school bus system;

26. Promote technology that reduces travel;

27. Protect the greenelt and gardens;

28. Ban building on floodplains;

29. Fill the million empty UK homes;

30. Incentivise building in the right place - improving an existing building should be VAT-exempt;

31. Subsidise energy-efficient homes, including smart-meters and water efficiency;

32. Create building standards to replace prescriptive regulation about how to build;

33. Taxes, subsidies and public procurement should promote a zero-waste economy - take-back rights for appliances, paid recycling, reduce landfill, recycle building material, promote long-life goods/buildings, combined heat and power systems;

34. We should contribute to a forest fund to support conservation by countries with forests;

35. Buy sustainable timber, starting with the government;

36. Implement carbon pricing.

The Way of The Green Thing

Wonderful.

Do the Green Thing.

The Bull Market in Australian Cattle Stations

Yep, amidst all the bloodletting and mayhem of the credit crunch, there's a bull market in Australian cattle stations - over 30 have been rounded up in the past 6 months. It seems they've been under-capitalised, relative to their potential capacity and projected global beef requirements, and stand to benefit from the decline in available land elsewhere.

Amongst the buyers are The Macquarie Pastoral Fund, Terra Firma (which just bought out the Packer's rural holdings) and Primary Holdings (management pictured on location), which is in the process of tying up with ex-Murdoch man Ken Cowley's iconic RM Williams vehicle.

It's such a significant opportunity that old mate and CEO, Bob Tucker (pictured, seated left), former COO at Man Global Strategies, recently moved from London to Sydney, after securing seed funding from the RAB Special Situations Fund.

I have a little empathy, as Irish ancestors on my mother's side helped open up the area of the Kimberley region in Western Australia that is now the Ord River irrigation area. The history is covered in Mary Durack's book, "Kings in Grass Castles". I see there's even an upcoming tour of the trek the various families took to get out there in the 1880's.

It's still a hard life out there, by all accounts. Nice to see that the humble whiteboard remains an essential tool.

Clean Coal?

More genius from the Cohen brothers - giant hat tip to Do The Green Thing.

Madoff Unleashes the Counter-Veblen Effect

I seldom bother to read the Sunday Times, but today I had little choice but to learn how the Madoff scam has rocked the exclusive world of the super-rich.

We can skip the lecture on supply and demand, save to say that all the featured sob-stories suggest that Madoff targeted the mega-wealthy private investor on a personal level, triggering a snob effect and/or bandwagon effect. In other words, the mugs confused either exclusivity itself or popularity amongst their "circle", with the quality of the investment. According to the FT, even "Union Bancaire Privée, the Swiss bank that is one of the world’s biggest hedge fund investors, told clients in a letter this week that it had spotted potential dangers but had been reassured by Mr Madoff’s reputation and clean regulatory record." More snobs on the bandwagon.

Of course, appealing to investors on this basis was especially insidious, as it robbed them of any interest in transparency. Whereas concern at the lack of it kept more rational institutions and professional investors safely at bay. Even the publication of Michael Ocrant's article in May 2001 ("Madoff tops charts: sceptics ask how") strongly suggesting a scam, failed to restrain the rampant enthusiasm amongst the wealthy elite for the long social climb ahead.

Well, they're all down from the mountain now, of course, claiming they should've been warned by the SEC and raging round their lawyers' offices spouting the whole sorry history of restaurant names and lunch dates while litigators take notes. But once they've ridden the whole length of the change curve, I have little doubt they'll get their own back without any help from the lawyers or regulators.

In fact, the backlash could well unleash what has been termed the "counter-Veblen effect: preferences for goods increasing as their price falls, over and above the traditional supply and demand effect, due to a conspicuous thrift amongst some consumers."

This will be more than merely an austerity measure. Like investing with Madoff, the counter-Veblen effect will be the product of a lifestyle choice. So, while it's interesting to see how it fits with the ways in which we are tightening our belts as a tactical response to the credit crunch, the counter-Veblen effect might actually chime better with, say, the actions of prominent people driven by environmental concern - like Darcey Bussell leaving for Australia to become an "eco-Mum", the committment of the entrepreneurs behind the Tesla electric car, and ultimately the Bill & Melinda Gates Foundation - as well as the authenticity demanded by the Web 2.0 community that clashed with "gut instinct" politics during the recent US Presidential campaign. Like these trends, the counter-Veblen effect could well turn out to be real and lasting.

So welcome, I suggest, to a new world of battered Bentleys, frayed collars and housecoats in Knightsbridge, where cheaper is better and champagne is for wimps.

London's Super Sewer - Pro or Con?

I never thought I'd be giving a hat-tip to Hammersmith & Fulham Council, but thankfully its Leader has warned residents of the £2.2bn "Super Sewer" that Thames Water plans to build under the Thames.

Somehow I'd missed all the kerfuffle.

Not content with writing to residents, the Council has also launched a petition that's been signed by over 1,500 people, and we are invited to a public meeting on the subject at Hammersmith Town Hall, King Street, on Monday 17 November 2008, at 7.00pm.

The Council is concerned that the Super Sewer is the "wrong solution to the wrong problem", is too costly (adding £200 p.a. to water bills), too disruptive (8 years of construction), will destroy open space, and is merely designed to avoid EU pollution fines that are open to challenge in any event. It recommends an independent study to review the problem, solutions and alternatives.

I confess to being somewhat perplexed, and would be interested to get a balanced view before choosing "sides", even if backing the Council only results in an independent study. It would be nice to see a concise summary of the problem, it's size, root causes and possible solutions - though not while eating a curry.

Having been less than impressed at the investment in maintaining London's creaking infrastructure to date, I'm wary of undermining Thames Water's enthusiasm on that front without a very good reason.

But the Council did a great job in opposing the West London Tram, and has shown itself to be very effective in arousing public support on this occasion too. Maybe it's on the right track again, if you'll excuse the pun.

Looks like I'll have to turn up to the debate.

Personal sat nav

Hot-footing it between meetings in the central areas of most cities can be a real heart-in-the-mouth experience if you aren't sure of your route. I found myself stuck the other day and used Walkit. I plugged in the two post codes and ended up with a series of alleys and cut-throughs in central London that I'd never have worked out on the fly. You even get a calorie burn and the satisfaction of knowing how much CO2 you saved against alternative transport.

Easy ways to do the Green Thing

Green Thing is a community that makes it easy and enjoyable to be a bit greener. Every month you’ll get a different Green Thing to do. All you have to do is do it.

October's Green Thing was "Walk Once", while November's Green Thing is a bit more open to interpretation...