Weekly clippings #19 - world climate declaration, IPCC non-evidence, dangerous ESG, regulators, decimating communities

I’d like you to challenge me and the statements I’ve made. I said at the start of our continuing conversation that I am open to any questions, any challenges to my statements, and I’m willing to discuss any arguments. Mutual fund companies are such an important part of my business and thus my life, and I am trying to save the companies and myself from embarrassment, reputational and regulatory damage, and even financial losses through my conversation with you. Thank you for being open to these topics and patient with my weekly stream of information. I hope you are now seeing that there is a tremendous body of work based on fundamental principles of science, economics, investment, and morality behind my efforts.

This week, as a lead-up to our meeting, I’ve focused on the very big picture in the Science category. As you know, my comments have largely emphasized the E portion of ESG, which comprises the vast majority of ESG, and towering over the dominant E factor is the hypothesis that human activity is producing CO2 that is creating dangerous global warming. Trillions of dollars have been spent in an effort to “fight” climate change through ideas like net-zero, “renewable” energy like wind and solar, “green” vehicles powered by electric batteries, opposing fossil fuel development, carbon capture, carbon credits, carbon taxes, etc. Most fundamentally, my study of the science literature clearly shows no sort of climate emergency, crisis or even something significant that is outside natural variability exists. Research from all the applicable science disciplines repeatedly shows this. Today I bring you two important confirmations of this: the first is the World Climate Declaration initiated by many of the world’s eminent scientists. Second is a table from the most recent IPCC AR6 science report – a summary table showing that today we can barely detect any human influence in almost all the climate impact drivers, nor is such detection expected by 2050.  If you have not already read the science book by Steven Koonin I sent to you, I encourage you to do so as it very clearly references the best available science data and explains how public perceptions and policies are so very far from reality.
 
In the Investment/Economics category I have provided much more material than usual, mostly focused on the great regulatory risks I am concerned that your company is exposed to. What we see happening is that when strict definitions and criteria are applied to ESG products, almost all of them come up short, never mind their contradictory nature. Some large companies are paying massive fines for products and messaging that conflicts with what they are actually doing. I also provided a couple of submissions made by groups of scientists to regulators in Canada and the USA, and I can easily see a great expansion of claims about false marketing, class action lawsuits, performance claim attacks, not to mention the numerous immoral aspects of net-zero ideology. In recent days we have started to see major political backpedaling from net-zero policies as their true high cost and how they damage the lives of citizens is becoming more concretized as attempts are made to bring them into effect. The UK and Germany have been early adopters of net-zero policies and the backpedaling has only just begun.
 
Finally, in the Absurdity category, I bring you three stories, but the one that struck me the most was the German airline Lufthansa telling us that converting their fossil fuels to “green” fuels would require half of all the electricity produced in Germany! In other words, just because something is possible does not mean it makes any sense in the real, human world.

World Climate Declaration: There Is No Climate Emergency  To believe the outcome of a climate model is to believe what the model makers have put in. This is precisely the problem of today’s climate discussion to which climate models are central. Climate science has degenerated into a discussion based on beliefs, not on sound self-critical science. Should not we free ourselves from the naive belief in immature climate models?

I refer you to page 1856 of the IPCC AR6 which shows Table 12.12, titled Emergence of climate impact drivers (CIDs) in different time periods. I draw your attention to the third column, which is "Already emerged in Historical Period." There are 33 rows of CIDs. Only in five of these is there high confidence of a signal, never mind one of significant magnitude to cause any meaningful harm, and one of these five is simply the rise in CO2, which by itself is causing global greening. Almost all the CIDs are left in white, indicating there is no signal at all. Note that every single CID for "Wet and Dry," "Wind" and "Coastal" is white - no signal.  Also note the fourth column is "emerging by 2050 for RCP8.5, an extreme, irrational scenario which is totally discredited and long proven false. Even then, it shows almost no change by 2050 in CIDs. A mini-version of the table is right here.

 

The ESG investing industry is dangerous A BlackRock dissident speaks truth They must know that they’re exaggerating the degree of overlap between purpose and profit . . . These leaders must know that there is no way the set of ideas they’ve proposed are even close to being up to the challenge of solving the runaway long-term problems . . . And right now all of the other stuff they’re saying — the marketing gobbledegook — is actively misleading people.

Why ESG is fatally flawed  ESG doesn’t benefit investors, and on balance it likely harms them. It does, however, benefit its advocates at investors’ expense. ESG thus fails morally: its advocates encourage its practitioners to parade their vanity, ignore shareholders, and evade accountability. ESG, in short, is socially irresponsible.

Open Letter to Office of the Superintendent of Financial Institutes Just imagine if a group of scientists wrote a letter to investment regulators detailing all the misleading and false claims made in ESG-related marketing materials and investment product materials, named your investment company as a prime example, and copied the media and investor advocacy groups. “Whatever the merits on climate-related financial risk disclosure, popular methods and much of media reporting on climate change utilize information resulting from lapses in scientific integrity.”

FAIR Canada wades into battle to ensure ESG compliance 
The ‘G’ in ESG — governance — won’t go away, and for good reason - Edward Waitzer - “All of this will contribute to the increasingly politicized nature of corporate governance.” This article is full of mixed premises.

Critical comments by Happer and Lindzen on SEC Rule  and Amicus brief  
 
Asset Managers Rebuffed as EU Cracks Down on Use of ‘ESG’  More than 80% of Article 8 funds would have to stop using “sustainable” in their name, under the current proposal.

DWS to pay $25M to settle SEC’s ESG, AML probes  “DWS advertised that ESG was in its ‘DNA,’ but … its investment professionals failed to follow the ESG investment processes that it marketed”
 
The SEC’s New Rule May Inadvertently Kill ESG Funds  
WSJ - Britain Blinks on Net-Zero Climate Mandates - Economic and scientific realities catch up with a costly political fad. Britain’s net-zero ambitions would collapse eventually anyway under the weight of their steep cost and global irrelevance. The warning for politicians everywhere is that the rush to net zero is a costly political loser. The longer policy makers wait to admit it, the more painful the reversal will be.

The Impossibility of Net Zero Not one part of the green policy agenda has lived up to any promise to deliver good to the British public. 
 
 

‘We’ve cut carbon emissions by decimating working-class communities’: the leader of the GMB union on the folly of net zero ‘The renewables lobby is very wealthy and powerful,’ says Smith. ‘I think people on the left, for good intentions, have got hoodwinked into a lot of this.’

German airline Lufthansa says it would consume half of Germany’s electricity if it were to switch to green fuels  “We would need around half of Germany’s electricity to create enough of the fuels”

'Always check the label': ESG funds not as green as they seem