Market Thinking

making sense of the narrative

They have plans for your savings

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The quote attributed Winston Churchill about never letting a good crisis go to waste came as he and others were looking to set up the UN after the Second World War and was popularised more recently by Obama’s chief of staff Rahm Emanuel in the wake of the Global Financial Crisis. It is important because it captures the mindset of many, sometimes conflicting, powerful interests and may help give us some useful insights into the structure of the likely New World Order to emerge from this current crisis.

Never let a good crisis go to waste

Winston Churchill

While conspiracy theorists may talk about powerful interests deliberately creating the Covid-19 crisis (which we do not believe) there is no doubt that now that we have the crisis there are a lot of different interest groups with a lot of different agendas now seeking to take advantage of this current state of flux to advance their particular agendas. Thus it is important that in considering the medium and longer term prospects for investing that we take into account the ideas of the players who may help shape it. As ever, this is not about what we would like to happen, or even what we think should happen, but rather what we think we need to look out for.

The Men of Davos

This post considers perhaps the most obvious agenda, not least because they are amongst the most vocal, which comes from the Men of Davos, the World Economic Forum (who else) with their latest pronouncements on The Great Reset’. This can be seen in more detail here, weforum.org where they talk about “ a more fair, sustainable and resilient post Covid future.” All very sensible sounding no doubt, but note that this is not about economic growth, it is, as ever, about global government and about redistribution. In fact none of it is really new; it comes under a well established plan called UN Agenda 2030 for sustainable development, which used to be called UN Agenda 21. This was founded in 1992 and as well as the WEF it is supported by all the usual globalist names that get the conspiracy theorists hyper-ventilating; such as George Soros, the Rockefeller Foundation, the Bill & Melinda Gates Foundation and all the other names associated with the latest wave of Globalisation and Globalism

Take a look at the link below, which is just one portal into the absolutely enormous centralised plan that the WEF have created for the world economy. It’s title is the Great Reset as if it was produced in response to Covid, but this was not written up in the last few months; it has been a very long time in the making and they clearly believe its time has now come.

https://intelligence.weforum.org/topics/a1G0X000006OLciUAG?tab=publications

The 17 development goals in UN Agenda 2030 are sometimes known as the Green New Deal, which we have already heard a lot about and about which we should expect to hear a lot more. There are numerous articles already out there about a “Green Reset’ and a need for ‘A more sustainable future’ . This is why we noted recently that even though we think that the alternative theory explaining most if not all of the phenomena observed as Climate Change is compelling, it will ultimately make little difference, because of the huge vested interest in the ‘solutions’ to the declared problem of ‘carbon’. These solutions include the promotion of the green industrial complex, but also a repression of freedom of private markets to allocate capital and, of course, centralised levies and taxes. The ability to tax people you don’t like and distribute to those you do might almost be thought of as a guiding principle for many seeking power. Meanwhile, Wall Street has its own ‘solution’ which is the trading of Carbon Credits, sold as some form of ‘free market solution, providing incentives not to pollute’, but in reality simply another source of trading income and a currency to manipulate and distribute as seen fit.

ESG as a policy tool

For investors, this agenda and the belief it will be heavily promoted over the next 12 months is part of the reason that we posted recently on the likely manner in which ESG is going to be pushed further into the mainstream while simultaneously allowing governments and others such as the WEF to manipulate ‘private’ savings as a tool of global government. If trillions of $ in pensions and other private savings are going to be restricted as to where they can invest on the basis of an agreed set of broadly defined principles, then whoever controls the list of principles controls the assets. And of course right now it looks like the rules for who is going to be acceptable or not are going to be set by the UN and the men of Davos. Banks too, in September 140 banks representing $47tn of assets (about a third of the world total) signed up to the UN sustainability principles.

Investing for a net zero world must go mainstream

Mark Carney former Governor of the Bank of England now UN special envoy for climate action and finance

Against this background, it is useful to look at the recent trajectory of former Governor of the Bank of England, Mark Carney. He is now the UN special envoy for climate action and finance and sits in oversight of a ‘voluntary’ regime of disclosures on financial risks from climate change. However, we should be in no doubt as to his agenda, As he put it in a speech announcing his new role  “the disclosures of climate risk must become comprehensive, climate risk must be transformed, and investing for a net zero world must go mainstream.” In effect, he aims to give the UN the means to allocate international capital according to their views on sustainability and Climate change. Markets and private capital are to have no role in this, it will be decided by ‘scientists’, NGOs and other lobby groups. If we aren’t wary enough after the last three months of where a combination of politicians and scientists can drag our economy, we should be worried about this. It is textbook central planning. That said, just as we noted last week that even though the alternative explanation for all the observations on climate change is highly compelling it will largely be ignored, this further escalation of Climate into mainstream investment looks unstoppable. 

Regulation will also be used. We note that the Financial Conduct Authority (FCA) in the UK have announced via a discussion paper that they may use capital requirements to limit investment in ‘carbon’ assets.

Lest we think this won’t happen, consider the ‘great repression’ that we have already lived through for the last decade or more; private savings have been effectively forced to buy government bonds at increasingly lower, now negative, real yields because the ‘rules’ about risk have declared it so. Meanwhile, the US, in particular, has used the dominance of the US banking system as a means by which to require foreign companies, especially banks, but more recently pipeline companies looking to complete a gas pipeline linking Russia to Germany, to enforce US foreign policy sanctions on third countries. Further control of other people’s capital is only going to increase.

Readers may think this is all very laudable, but make no mistake, politicians are demanding the right to allocate private capital. The clearest and most obvious plan to emerge from the Covid crisis is what amounts to a ‘trans-nationalisation’ of capital markets.

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