Jens van 't Klooster 💸💸💸Disappointing schedule for the @BIS_org @NGFS_ Green Swan conference on the very important topic of real economy impact of the climate transition, but then concerning the role of central banks it gets very high level and abstract, basically reflecting a 2015 risk-focus
Day 1 makes sense as a basic overview of all the incredibly technological innovations that are going to uproot economies and create big stranded assets.
Then on day 2 we get panels the old story: financial risk and getting banks to hold enough capital to weather their own bad investments.
A speaker like John Hassler, who is responsible for the 2018 Nobel Prize for Nordhaus and a 2022 Prize for banking and financial crises which does not mention climate change, is a weird pick (I wrote him about this and a commentary due to come out at @ErasmusJPE)
Where is the most obvious conundrum today: the impact of higher interest rates on deep sustainable infrastructure investment. These crucial investments have high upfront costs, but after that have a very stable cost profile.
Fossil fuels infrastructure, in contrast, is initially cheap, we know how to build it and the main cost results from volatile, dirty and imported material inputs. High rates favour those dumb investments.
There is also no panel for thinking through better policy instruments: there exist many ways to differentiate interest rates and offset the fossil fuel biases of the current hike.
From the original Green Swan report:
From the original Green Swan report:
But here is hope: @stephanygj might get the discussion on the real issues going