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« CCS projects may be uninsurable | Main | RICO letter disappears »
Wednesday
Sep302015

The otherworldliness of Mark Carney

The Governor of the Bank of England, Mark Carney, has once again been trying to use his position to bully the insurance industry into supporting the green movement. His speech last night at Lloyds of London was fascinating - a blend of pseudoscience, green activism and big state interventionism the likes of which one rarely finds outside DECC and Defra. 

As far as I can see, Carney's big idea was that more should be done "to develop consistent, comparable, reliable and clear disclosure around the carbon intensity of different assets". 

[A] framework for firms to publish information about their climate change footprint, and how they manage their risks and prepare (or not) for a 2 degree world, could encourage a virtuous circle of analyst demand and greater use by investors in their decision making.  It would also improve policymaker understanding of the sources of CO2 and corporate preparedness.

This really comes across as quite otherworldly. As was noted in the FT a few days ago, the stranded assets argument is a myth. Moreover, the insurance industry does not price risk based on what GCMs say the world is going to look like in a hundred years' time. The only interest analysts are going to have in insurers' preparations for the end of this century is surely going to be to demand why they are wasting their time on anything quite so ridiculous.

Insurers might, in passing, wonder why the man charged with overseeing the country's financial stability is so divorced from the real world that he thinks any of this worth a moment's thought, let alone any concrete action. But no doubt they will shrug their shoulders and move on.

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Reader Comments (51)

Carney's been listening to his Greenpeace obsessed wife again it seems. Doesn't give you a very good feeling that the Bank of England is in good safe hands.

Sep 30, 2015 at 9:30 AM | Unregistered CommenterJohn B

But breathlessly repeated by the BBC..

Sep 30, 2015 at 9:31 AM | Unregistered CommenterBitter&Twisted

Doubtless the speech pleased Mrs Carney.

Sep 30, 2015 at 9:33 AM | Unregistered CommenterJohn Page

OMG, are we going to get interest rates set in order to control CO2 emissions? He talks about risk from climate change, fair enough as long as it is regarded just as a risk rather than a certainty, but what about the risk of litigation from everyone slightly inconvenienced by bad weather?

Sep 30, 2015 at 9:33 AM | Unregistered CommenterMikky

Wullie Shakespeare:
'Yon Cassius has a lean and hungry look;
He thinks too much. Such men are dangerous.'

My hunch is that Carney thinks 'too much' about his own career, and that he has his eye on some international role next. Hence the greenie guff, since that seems, despite everything, to remain fashionable in high circles where high-falutin' jargon such as Carney deploys helps hide the squalid, destructive, immoral reality of it all,

A post on Carney here about six months ago: http://www.bishop-hill.net/blog/2015/3/11/carneyform-waffle.html
Extract: 'The Governor of the Bank of England, Mark Carney first came to the attention of BH readers when, at the time of his appointment, it was noted that his wife Diana was (and is) a fervent supporter of the green movement (and redistribution as well as being against conspicuous consumption).'

And again, about 12 months ago: http://www.bishop-hill.net/blog/2014/10/12/the-old-lady-of-eco-street.html
Extract: 'Yesterday, the House of Lords Economic Affairs Committee took evidence from Mark Carney, the governor of the Bank of England, who has shown himself keen to use his position to promote his environmentalist ideology.'

N. Bonaparte:
Great ambition is the passion of a great character. Those endowed with it may perform very good or very bad acts. All depends on the principles which direct them.

So, where does he want to go next?

Sep 30, 2015 at 9:39 AM | Registered CommenterJohn Shade

Such people are not clever...just interfering fools making it up/pushing it to preserve position. Met many similar before in corporates. Acres of paper, presentations, blab and ultimately useless, but the disruption and cost is enormous.

Its the regular morning puke edition of the BBC.

Was hoping the VW episode might knock over the green house of cards but looks like they are rolling over legs up. So much for the powerful motor industry....money!

Sep 30, 2015 at 9:39 AM | Unregistered CommenterEx-expat Colin

Breathlessy reported by ITV as well.

I never watch TV news but was strolling through the living room yesterday and caught the 10 o'clock ITV news segment on this. The reporter was, no exaggeration, almost hyperventilating.

Long and short is this is another attempted end run around the public. The renewables gravy train is coming off the rails and the ONLY hope the activists have is legislation. IF they can get govts to make fossil fuels too expensive to mine (by swinging legislation) they can claim, "LOOK! THEY'RE UNPROFITABLE! WE TOLD YOU!"

It's desperate stuff.

They're screwed either way.
1. They lose and the green bubble bursts, taking them down.
2. They win. Legislation in place. Earth cools, but bills go through the roof with black-outs, and they end up in a prison cell.

Sep 30, 2015 at 9:48 AM | Unregistered CommenterStuck-Record

"why the man charged with overseeing the country's financial stability is so divorced from the real world that he thinks any of this worth a moment's thought"

Is this not another tiny piece for the Paris jigsaw. Look at the economists and financial institutions who have pushed AGW in recent times:

The World Bank itself: http://www.worldbank.org/en/topic/climatechange
"Climate change is a fundamental threat to sustainable development and the fight against poverty. The World Bank Group is concerned that without bold action now, the warming planet threatens to put prosperity out of reach of millions and roll back decades of development"

Adair Turner, former FSA, fully signed up to "contract and converge", the UN mantra, has worked with Al Gore on "Carbon" reporting by global companies.

Joseph Stiglitz, Columbia University, Socialist International, former World Bank, he supported the Stern Review, in 2008, address at the United Nations Conference on Trade and Development (UNCTAD) and later to the International Labour Organization: "For the longer-term, the Commission would be calling for the creation of a new global reserve system - away from the US dollar - that could be used not only to maintain financial stability but also finance development and the fight against climate change."

Stern, former World Bank, European Bank for Reconstruction and Development, Special Adviser to the Group Chairman of HSBC on Economic Development and Climate Change, carbon trading history with Idea Carbon. Former adviser to CCS Institute, past member of Potsdam science advisory board.

Ciao Koch-Weser, Deutsche Bank, member of Ban ki Moon's High Level Climate Finance Panel after Copenhagen. Deutsche Bank had Pachauri, Oxburgh and Schellnhuber on their climate advisory board.

Etc, etc......

Sep 30, 2015 at 9:55 AM | Registered Commenterdennisa

Russia has just announced its going into Syria.
New 21st Century Iron coming down not in Europe but the Middle East right on top of the worlds second biggest Oil Supply
In Desert Warfare the side with the most and the best Tanks always wins. ISIS only have pick up trucks and no Aircraft.

Hope Carney has got enough money for the Re invasion of Iraq,
before Putin captures its sorry i mean liberate it.

Then Carney he will find out just how little a "real threat" Climate Change is to world security .

Sep 30, 2015 at 9:56 AM | Unregistered CommenterJamspid

Too much the Sgt Wilson and not enough the Cpt. Mainwaring in my view. And I know who I'd rather have running my local bank.

Sep 30, 2015 at 9:59 AM | Unregistered CommenterNickM

Mark Carney saying

could encourage a virtuous circle of analyst demand and greater use by investors in their decision making.
sounds uncomfortably close to the parable of the broken window. Carney wants to break business models to stoke demand in a sector he wants to support?

Sep 30, 2015 at 9:59 AM | Unregistered CommenterGareth

this is serious stuff with serious money involved, being used by serious people. By not following Carney (has there been any consequence of his speech in any financial market?), they will implicitly declare who the clown be.

Sep 30, 2015 at 10:04 AM | Registered Commenteromnologos

Just because he's Governor of the BoE does not preclude The Man being a Fool on issues other than Economics.

Another Stern clone.

Sep 30, 2015 at 10:10 AM | Unregistered CommenterNCC 1701E

Carney is another Goldman Sachs implant:

http://www.independent.co.uk/news/business/comment/mark-carney-sends-goldman-sachs-an-early-invitation-to-the-next-bailout-party-10463118.html

"Bankers from Goldman are strewn across key policy-making arenas across the world like no other financial institution.

As well as the Governor of the Bank of England, his deputy Ben Broadbent is ex Goldman, as were two previous Monetary Policy Committee members, David Walton and Sushil Wadhwani.

Across the Channel, European Central Bank chief Mario Draghi is a Goldman man, while in the US, Goldmanites make up a quarter of the Federal Reserve system’s regional presidents."

https://quidsapio.wordpress.com/2012/06/06/how-goldman-sachs-invented-cap-and-trade/

Sep 30, 2015 at 10:12 AM | Registered Commenterdennisa

At the risk of repeating myself [moi?].

For the unknowing masses [not for regulars here]...... with a newly installed CO² emissions limitation treaty [ref Paris] Goldman Sachs will make a financial killing on the world's biggest ponzi scheme because it can't fail - all of it is underwritten by the taxpayers of the western world. Goldman Sachs, will have the inside line on Carbon trading - yes that's right they will be able to corner the market on selling plenary indulgences those less than useless carbon credits and think of the mark up! Money for fresh air - it is the greatest con and all you have to do is....... "to work for the company my son!"

Guess who.......................... BoE boss - Carney used to spiv for?

Sep 30, 2015 at 10:20 AM | Unregistered CommenterAthelstan.

I wonder who the PR people are for the Paris climatefest are because they appear to have every aspect of the doom and gloom/CO2 is evil religion covered.

You just have to look at what is being fed the MSM, such things that sharks are helping to slow global warming, fossil fuelled cars are bad (the VW thing has been known for years so why just now), the Aus PM removed because he didn't believe, the list goes on and on. In most cases we tend to ignore such things because that is what we expect from the green blob but at this time it appears orchestrated. Is that because they fear failure and the gravy train hitting the buffers?

Sep 30, 2015 at 10:31 AM | Unregistered Commenterivan

It's clear how this twerp got the top job at the BoE. As on-message as they come on greeny fantasising about plant food destroying the planet. And it did pay a handsome dividend, for him. As for knowing about economics - only if the sort of stuff taught by the LSE and the like passes as economics. But then anyone who did know much about economics would get short shrift from LibLabCon. It seems impossible now for first rate brains to aspire to state sector top jobs if they value their integrity at all.

Sep 30, 2015 at 10:35 AM | Unregistered CommenterMartin Reed

If I were an insurer I'd put my premiums up now in case there is a 2 degree rise in 100 years time like I'd expect all the other insurers to do.

Sep 30, 2015 at 10:40 AM | Unregistered Commenterson of mulder

'... could encourage a virtuous circle ...'

Virtuous for whom?

Sep 30, 2015 at 10:44 AM | Unregistered CommenterBarbara

Green Blob infiltration at No 10 and the BoE. The influence at No 10 is not as bad as previously thought possible. The BoE is still talking the talk, but has yet to take a hike.

Sep 30, 2015 at 10:50 AM | Unregistered Commentergolf charlie

Send him back to Canada, urgently! I seem to recall that someone in Ontario , I think, was a green activist and ruined what had been a very good energy supply system. On the back of that he became the "green" voice in the UN, and so one of the leaders of the climate scam. Is it something in the Canadian air?

Sep 30, 2015 at 11:05 AM | Unregistered CommenterDerek Buxton

Perhaps he merely wants to live up to his name:

“Roll up! Roll up! Come and see sights that will amaze you, that will astound you, that will TER-R-R-RIFY YOU!

“It is only a small entrance fee, but you will be glad you paid it – you might even wonder why we do not charge more! Roll up! Roll up!”

Sep 30, 2015 at 11:24 AM | Registered CommenterRadical Rodent

He can only be worried about political risk, and if so he's entirely justified. We have an example in the UK steel industry of how the political reaction to "global warming" is damaging to high-carbon-footprint businesses.

Sep 30, 2015 at 11:24 AM | Unregistered CommenterPete Austin

Later today, Richard Betts is giving a speech and BBC interview about the state of the UK economy and the prospects for future interest rates.

Sep 30, 2015 at 11:39 AM | Registered CommenterPaul Matthews

Paris is 2° north of us and we had an air frost last night!
Maybe the Gore Effect will be the decisive factor come the first week of December? We can but hope.

Sep 30, 2015 at 11:41 AM | Registered CommenterMike Jackson

Judging by the drivel spouted by the head of Aviva recently, insurers can be just as otherworldly.

Sep 30, 2015 at 12:06 PM | Unregistered CommenterDaveS

Paul M (11:39 AM). You capture nicely the incongruity of Carney's ill-informed excursion into 'pseudoscience, green activism and big state interventionism the likes of which one rarely finds outside DECC and Defra.'.

Paul H, meanwhile, illuminates Carney's blundering on the topic of 'weather-related loss events': https://notalotofpeopleknowthat.wordpress.com/2015/09/30/carney-repeats-climate-insurance-losses-myth/

Sep 30, 2015 at 12:28 PM | Registered CommenterJohn Shade

As a guest at the dinner I sat through the speech and it took all my strength not to get up and walk out. As a regulated person in the insurance industry I am subject to Mr Carney's jurisdiction so a deliberate insult would not have been helpful to my businesses.
However I can say that it was extraordinary for two reasons:
1 With all the live and pressing issues facing the insurance industry in particular and the financial sector in general, he chose to ignore all of them and focus instead on something for which there is no evidence of any immediate threat to financial stability.
2 His speech, which one of his colleagues was boasting of having written for him, was notable for its complete ignorance of climate science or of the current state of emissions reducing technology, and its espousal of creating new green financial instruments in the hope that they could provide a soft landing as we transition to a "zero-carbon" economy.

We heard a lot of cant about inequality, but if there is one financial policy guaranteed to increase inequality it is to suck money out of the functioning economy and divert it into synthetic financial instruments purporting to ameliorate the move to a zero-carbon world, but in reality lining the pockets of the same investment bankers who have rightly borne the lion’s share of the blame for the last financial crisis. Athelstan, I fear you may be bang on the money and I commented along the same lines to the people either side of me.

I was tempted to see if I could go to the basement and find the main fuse so I could plunge the room into darkness to give the distinguished guests a taste of a zero-carbon world.

Sep 30, 2015 at 1:12 PM | Unregistered CommenterDavid S

son of mulder at 10.40 am

You know perfectly well they are not intelligent enough to do something like that! The conspiracy theory falls down when it comes to people as dim as the average insurance company management. You know I know ;)

Sep 30, 2015 at 1:43 PM | Unregistered CommenterDavid S

Well, it's true - government action may yet "strand" carbon assets, wrecking widespread economic havoc.

Sep 30, 2015 at 1:54 PM | Unregistered CommenterPunksta

Is it something in the Canadian air?
Or is it something to do with Goldman Sachs.....the giant vampire squid?

Sep 30, 2015 at 2:34 PM | Unregistered CommenterJamesG

Carney's only claim to fame is that Canadian banks were not allowed to make the same loans s other western banks during the late 0's and therefore Canada was spared the banking crisis which befell the US and Europe. Unfortunately, if you look at why Canadian banks were not allowed to make these loans, you will see that it was not because of Carney - who was just slow in responding to calls from the banks to loosen the lending rules in order for them to take advantage of the deals other banks were getting.

On the basis of this one issue (him basically being slow and unresponsive to his stakeholders) he got invited to all of the big financial pow-wows and got a taste for being listened to. He jumped ship to the BofE before Canada got into trouble, but he has found that not a lot is going on anymore as the EU financial meltdown hardly affects the BofE.

However, he has got so used to being listened to that he feels he has to spout off about something else and the wonderful Climate Change(TM) is just made for anyone who wants to get their name in the papers. Doesn't matter what kind of crap you are talking, if you say Climate Change(TM) you get on the front page. Let's face it, who the heck would have published papers on dodgy internet surveys if they didn't have Climate Change(TM) in the title?

Sep 30, 2015 at 2:47 PM | Unregistered CommenterRob

Having sent him to the UK, we in Canada have let him loose to destroy the economies of the whole West, instead of just that of Canada. I'm ashamed to have both him and the father of the whole global warming scam come from here.

Sep 30, 2015 at 3:23 PM | Unregistered CommenterMark Fraser

David S, what was the general reaction of the audience or those you spoke with?

Sep 30, 2015 at 3:35 PM | Unregistered Commentermichael hart

I do think this contribution by Carney is an early product of Agenda 2030 which, by the way comes into effect on Jan 1st 2016 ^.^
I am not worried about Carney being 'other wordly' but I am worried about the logistics of getting him back there!

Sep 30, 2015 at 3:41 PM | Registered CommenterDung

michael hart
The people around me and some in the bar afterwards were pretty perplexed. Whatever their views on climate change, they found it hard to understand why Carney had decided to focus on it to the exclusion of all else. Those of a sceptic persuasion were as irritated as I was, and there were a lot of people in the room who had studied weather related insurance losses and knew his numbers were flaky.

Sep 30, 2015 at 4:12 PM | Unregistered CommenterDavid S

Warren Buffet of Berkshire Hathaway who owns a number of insurance and re-insurance companies is in a position to know how much climate change has affected insured losses. He does not see any. He did say that the fear mongering was beneficial to his business.

Sep 30, 2015 at 4:56 PM | Unregistered CommenterSean

Sean Sep 30, 2015 at 4:56 PM

"He did say that the fear mongering was beneficial to his business."

Surely not Sean?

Sep 30, 2015 at 9:46 PM | Unregistered Commenterson of mulder

David S, I have qualifications in surveying and engineering. The global warming message was all about hotter drier weather, which in the UK leads to very expensive insurance claims due to clay deseccation causing subsidence. Do subsidence claims show any increase or decrease over the last 40+ years since subsidence became an insured peril?

I am aware of the 1976 peak, another one early 90s, and again mid to late 90s. Anything else? Any statistics or graphs from the Association of British Insurers?

Sep 30, 2015 at 10:37 PM | Unregistered Commentergolf charlie

At first I believed Osborne when he said he had picked the best man for the BofE job. Then he failed to predict correctly the interest charge increases to come. Forward guidance it was called. He went ahead like the Climate Change models and found himself well above actual interest rates stuck at 0.5% - "The Pause" just like the (unadjusted) satellite measurements.
Now he is predicting catastrophic climate change as if he knows the first thing about the subject. Good partner for the Pope I should say. There more I see of this man the happier I will be when he returns to Canada after the end of his fixed contract. Not one of Osborne's best decisions.

Sep 30, 2015 at 11:38 PM | Unregistered CommenterJohn Peter

As a Canadian,

Apologies to citizens of the UK for Carney, apologies to the citizens of China for Strong, we are searching for suitable homes for a few others. We kept the good ones McIntyre, McKitrick, Laframboise, Ball and others. It's amazing how decisive a cold climate makes one.

Oct 1, 2015 at 3:15 AM | Unregistered CommenterMike Singleton

Bish

FYI

http://wattsupwiththat.com/2015/09/30/bank-of-england-climate-change-a-huge-financial-risk/

Oct 1, 2015 at 3:38 AM | Unregistered CommenterAnother Ian

golfcharlie There hasn't been anything much in years - it's just not a hot topic these days. Climate ChangeTM now involves more rainfall even though the old allegedly physical model had drier summers. A bit of a scare in 2010/11 but nothing really happened.

Oct 1, 2015 at 9:43 AM | Unregistered CommenterDavid S

David S, thank you for the update. 10-15 years ago, I thought all sorts of headlines were going to be created by subsidence caused by global warming. And then nothing happened.

Anything that does happen, is just what climate science predicted would happen, in a warming world, however climate science failed to predict the lack of warming, in a warming world.

Oct 1, 2015 at 10:21 AM | Unregistered Commentergolf charlie

They sell Carney's story in Canada as well...
http://www.cbc.ca/news/business/carney-warning-fossil-fuel-analysis-1.3250294

Oct 1, 2015 at 5:00 PM | Unregistered CommenterTomRude

I managed to watch most of the ITV news coverage without hauling the tv out to the nearest skip.

Lots of extreme weather this and extreme weather that and pictures of the somerset floods.

And no voice from the scientists who agree that ascribing the somerset floods to climate change by dame julia was a mistake.

When are they going to grow a spine and say "Hey, wait a minute, you are making it all up "

Oct 1, 2015 at 6:10 PM | Unregistered CommenterClovis Marcus

Mark Carney's arguments rest on an array of future carbon dioxide emissions projections, leading to an array of future rates of climate change, giving rise to an array of changing future rates of climate damages.

It is measured analysis: - http://cbat.info/#domain-4

David King has called this, "obviously a beautiful piece of work" and he's not alone: - http://www.gci.org.uk/Documents/z.pdf

Since the climate damage rate is already rising, it is obvious why insurers and bankers seek a strong climate agreement at COP-21: - http://www.gci.org.uk/images/banks.png

Oct 3, 2015 at 8:52 AM | Unregistered CommenterAubrey Meyer

"Measured analysis" that is based on climate models that are clearly off the rails.

Oct 3, 2015 at 9:11 AM | Unregistered CommenterPunksta

It is the case that the climate models have underestimated the rates of change with which we are faced due to the omission of major feedback effects: - http://cbat.info/#domain-1

"I understand the need to include feedback-related emissions. It is important to deal with worst-case scenarios, and clearly this includes feed-back effects. At this point however, they are difficult to quantify or even estimate, however important. Converting this into impacts is what the ‘Carbon Budget Accounting Tool’ (CBAT) programme deals with and CBAT is obviously a great piece of work.

Sir David King
UK Government Special Representative for Climate Change

Oct 3, 2015 at 9:39 AM | Unregistered CommenterAubrey Meyer

Aubrey Meyer

Bishop Hill is the wrong place to come to parade a bunch of unproven scare stories plus it is a bit old hat since they are currently still disembowelling Carney for the same stupid crime.

Oct 3, 2015 at 4:26 PM | Registered CommenterDung

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