The Financial Times put out a Nov. 3 op-ed on its Lex financial commentary service column, and syndicated on Nov. 4, “COP26: Carney’s $130tn Climate Pledge Is Too Big To Be Credible.” They warn Carney about the dangers of “over-promising” and then “under-delivering” on what the private sector will do on the green transition, and that the whole gambit is going to “require huge state intervention and investment.” (https://www.ft.com/content/87690ee9-c9b1-44b6-881b-368139560295)
“There are problems with the figure of US$130 trillion” loosely thrown around by Carney at COP26 regarding the role of his private sector Glasgow Financial Alliance for Net Zero (GFANZ) “group of banks, fund managers and insurers,” writes the FT. “First, if it were an investment fund, as some observers wrongly assumed, it would be insanely large. The financial sector would be committing a sum six times larger than the annual gross domestic product of the U.S. The market capitalization of the world’s stock markets is only about US$120 trillion.”
They explain: “US$130 trillion is not ready funds, but total assets managed by member financial institutions.” And then go on to say: “US$130 trillion may still be wrong even as an aggregate of member assets. Banks account for half of the total. And banks habitually count single assets several times through chains of lending….
