PostCapitalism: A Guide To Our Future by Paul Mason, Farrar, Straus and Giroux, New York, NY, 2015
The Winning Of The Carbon War by Jeremy Leggett, Blurb, San Francisco, CA, 2016
These two books, Postcapitalism: A Guide To Our Future by Paul Mason and The Winning Of The Carbon War by Jeremy Leggett, track the global systemic changes and sum up the key paradigm shifts happening at every level from global to local and among the new generation linked by social media.
Paul Mason, an economics editor for the British BBC's Channel 4, has tracked the evolution of globalization as driven by conventional economic GDP growth models. He argues convincingly that this model is now a spent force, with its burden of debt and persistent current account imbalances, currency wars and increasing stock market jitters. Mason salvages from the end of GDP-driven globalization and financialization the good news: The explosion of information technologies and the digitalization of so many 19th and 20th century sectors and business models.
What author Mason also sees along with futurist Jeremy Rifkin in his Third Industrial Revolution and the Zero Marginal Cost Society is that this IT revolution, while emerged from the old GDP-driven era, now threatens its continued existence. Information is now so democratized and accessible to consumers and citizens that business or government models of control via impounding and patenting information are now broken. We see these new forces in banking and many other businesses as fintech startups are eating many of Wall Street's assets - still tied up in fossilized sectors and incumbent industries as well as those in retailing, media and education (see The End of College).
Mason takes a heartening visionary view of all this disruption when non-performing stranded assets are written down. The decks are clear for the rapid development of the new model, as laid out by 195 member countries of the United Nations in 2015: the Sustainable Development Goals (SDGs) and the Paris Outcome which pledges all these nations to shift from dirty, polluting fossil assets (now liabilities) to low-carbon, healthier, knowledge-rich, green economies. What tipped the balance in 2015 was the ranks of institutional investors and financial firms which are already profiting from the shift to renewably resourced, efficient economies. These include the members of Ceres, representing $13 trillion of AUM, and those of the UN Principles for Responsible Investment, representing global pension funds with AUM of $59 trillion.
Thus, the new energy and efficiency sectors are now mainstream, as keynote speaker Michael Bloomberg emphasized at the UN Investor Summit on Climate Risk, January 27, 2016. Current market jitters illustrate the final battle between past fossilized incumbents and the new information-rich, renewably resourced economies of the next stage in human evolution. Key now is for conventional asset management to catch up and update their fossilized asset allocation buckets still mispricing energy and risk.
Jeremy Leggett's account of this historic global shift is as an entrepreneur operating in the trenches and founding director of Solarcentury and founder-chairman of SolarAid. This is a page-turning account of The Winning of the Carbon War, a blow by blow tell-all on how all the players, big oil, coal, gas frackers, nuclear enthusiasts and their backers in Wall Street and London tried to crush the rise of solar, wind, hydro, geothermal and all the new energy technologies and storage systems based on harvesting free fuel from our mother star: the Sun. Leggett's successful solar companies stood their ground. They formed coalitions with other trade associations, developed new financing models to leapfrog the upfront costs, eventually scaling all these technologies. New accounting metrics helped, e.g., GRI, SASB, IIRC, internalizing the social and environmental costs of fossilized production, transport, distribution and consumption - all obscured in the old GDP growth models, using that Freudian slip "externalities". The IMF now estimates that global subsidies and these externalities inherent in fossil fuels still account for as much as $5.3 trillion annually worldwide.
Author Leggett, who also chairs Carbon Tracker, takes us to all the private meetings at hedge funds, oil majors, sovereign wealth funds, UN climate conferences with names of those involved, including, among others, the following listed companies: Accenture (ACN), American Airlines (AAL), Apple (AAPL), Areva (AREVA.PA), Citigroup (C), Coca-Cola (KO), ConocoPhillips (COP), Deutsche Bank (DB), Duke Energy (DUK), Exxon Mobil (XOM), General Electric (GE), Goldman Sachs (GS), Alphabet (GOOG) (GOOGL), Harley-Davidson (HOG), JPMorgan Chase (JPM), Marks & Spencer (OTCQX:MAKSF) (OTCQX:MAKSY), Morgan Stanley (MS), Petrobras (PBR), Philip Morris (PM), Shell (RDS.A) (RDS.B), Sony (SNE), Statoil (STO), Tata (TTM), Tesla (TSLA), Unilever (UL), and Volkswagen (VLKAY).
Both these books are a boon to asset managers and consultants trying to understand current market volatility and trends. These books pull back and take a necessary wide-shot looking further down the road to the some $45 trillion new markets now opening up in our next Solar Age.
Editor's Note: This article discusses one or more securities that do not trade on a major U.S. exchange. Please be aware of the risks associated with these stocks.
This article was written by
Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
Additional disclosure: For full disclosure, I am long on Envision Solar (EVSI) and Natcore (NXT) and in several private companies – GrainPro, Green Garmento, B 3.8, Equal Access – and equity funds, including Generate Capital.