{"id":220993,"date":"2025-03-31T09:59:27","date_gmt":"2025-03-31T13:59:27","guid":{"rendered":"https:\/\/ibkrcampus.com\/campus\/?p=220993"},"modified":"2025-04-02T14:00:41","modified_gmt":"2025-04-02T18:00:41","slug":"when-climate-meets-wall-street","status":"publish","type":"post","link":"https:\/\/www.interactivebrokers.com\/campus\/podcasts\/ibkr-podcasts\/when-climate-meets-wall-street\/","title":{"rendered":"When Climate Meets Wall Street"},"content":{"rendered":"\n<p>Climate change is accelerating \u2014 and the economic fallout is already here. Economist Michael Penn joins us to unpack the rising cost of disasters, the $4,500 carbon question, and what climate tipping points mean for growth, inflation, and global stability.<\/p>\n\n\n\n<iframe title=\"When Climate Meets Wall Street\" allowtransparency=\"true\" height=\"150\" width=\"100%\" style=\"border: none; min-width: min(100%, 430px);height:150px;\" scrolling=\"no\" data-name=\"pb-iframe-player\" src=\"https:\/\/www.podbean.com\/player-v2\/?i=3map7-1868d01-pb&#038;from=pb6admin&#038;share=1&#038;download=1&#038;rtl=0&#038;fonts=Arial&#038;skin=1b1b1b&#038;font-color=ffffff&#038;logo_link=episode_page&#038;btn-skin=c73a3a\" loading=\"lazy\"><\/iframe>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-summary-ibkr-podcasts-ep-240\">Summary \u2013 IBKR Podcasts Ep. 240<\/h2>\n\n\n\n<p><em>The following is a summary of a live audio recording and may contain errors in spelling or grammar. Although IBKR has edited for clarity no material changes have been made<\/em>.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-jose-torres-nbsp\"><strong>Jose Torres<\/strong>&nbsp;<\/h3>\n\n\n\n<p>Hello everyone, and welcome to this edition of Interactive Brokers\u2019 IBKR podcasts. I&#8217;m Jose Torres, your senior economist. With me today is a special guest, Mr. Michael Penn. He is the Head of Climate Macro Strategy at Absolute Strategy Research. Prior to his time at ASR, he was the Chief Economist and Strategist at Cohen &amp; Steers.&nbsp;<br>Prior to that, he held related positions at Bank of America Merrill Lynch. We&#8217;re excited to have Michael Penn here today to talk about some climate trends, as well as some forecasts and ASR\u2019s proprietary research on climate change. Michael, welcome.&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-michael-penn-nbsp\"><strong>Michael Penn<\/strong>&nbsp;<\/h3>\n\n\n\n<p>Yeah, thanks very much, Jose. Thanks for having me.&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-jose-torres-nbsp-0\"><strong>Jose Torres<\/strong>&nbsp;<\/h3>\n\n\n\n<p>Absolutely, it&#8217;s great to have you. And let&#8217;s dive right in. Climate change has been a huge topic in the past few decades. On one side, we have activists that think we need imminent change in lifestyle and government expenditures to accommodate the changing landscape.&nbsp;<br>And then you have, on the other hand, climate deniers that think that climate change is a trend that&#8217;s going to come and go. They point to the natural ebbs and flows of historical temperatures as a justification for climate change and don&#8217;t think that much change is needed imminently.&nbsp;<br>Michael, can you start with an overview regarding anticipated changes in climate and current goals to minimize the extent of temperature increases?&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-michael-penn-nbsp-0\"><strong>Michael Penn<\/strong>&nbsp;<\/h3>\n\n\n\n<p>Yeah, sure. Look, why don&#8217;t we start with where we are today? So the global average temperature is around 1.4\u20131.5 degrees Celsius\u2014that&#8217;s about 2.7 degrees Fahrenheit above the preindustrial level.&nbsp;<br>So when climate scientists talk about global warming, what they do is they say, okay, what was the average temperature up to the year 1900? And then let&#8217;s record temperatures as they&#8217;re increasing post the 1900 period. So we&#8217;re already at 1.4\u20131.5 degrees Celsius\u20142.7 degrees Fahrenheit above that sort of what we call preindustrial level, and temperatures are rising at a pretty rapid pace.&nbsp;<\/p>\n\n\n\n<p>Now, you might think 1.4, 1.5 degrees\u2014or 3 degrees Fahrenheit\u2014what\u2019s the big deal? But climate scientists tend to think that if temperatures move from around 1.5 degrees into the kind of 2 degrees Celsius zone, then we&#8217;re going to start to see a significant move up in the severity and the frequency of extreme weather events.&nbsp;<br>So we&#8217;re talking about more intense hurricanes, maybe longer-lasting heatwaves, more devastating floods\u2014real kind of damage to the economy and to communities.&nbsp;<\/p>\n\n\n\n<p>And as we move into that bad threshold\u20141.5 to 2 degrees Celsius\u2014we\u2019re at risk of triggering what scientists call \u201cclimate tipping points.\u201d Now, these are thresholds which, once you cross them, lead to major changes in the climate system. So a couple of examples:&nbsp;<br>Yeah, two degrees\u2014the evidence seems to suggest that maybe one to one and a half billion more people will be exposed to extreme heatwaves than would be the case at 1.5 degrees of warming. So that\u2019s like the entire population of India facing potentially sort of life-threatening levels of heat.&nbsp;<br>And at two degrees of warming, we&#8217;d see twice as many plant species lost relative to what would have happened at 1.5 degrees. For insects\u2014which, of course, play a crucial role in our ecosystems and as we think about food production\u2014the loss of insect life would be about three times worse.&nbsp;<\/p>\n\n\n\n<p>So, we\u2019re really looking to limit any further increase in warming caused by man-made greenhouse gas emissions and to stay as close as possible to that kind of 1.5-degree target.&nbsp;<\/p>\n\n\n\n<p>Now, the Paris Climate Agreement that was signed in 2015\u2014and the U.S. has recently withdrawn from that agreement\u2014but the Paris Agreement set out some of the toughest climate targets that we&#8217;ve ever seen. And the aim was to limit warming to well below 2 degrees.&nbsp;<br>Now, if you look at where governments are right now and you look at what governments have pledged, that\u2019s consistent with maybe 2.1 degrees of warming.&nbsp;<br>But if you look at the policies that are actually signed into law\u2014so what governments have actually committed to do\u2014we\u2019re well short. We\u2019re more on target for about 2.7 to 2.8 degrees of warming. So, there are some critical thresholds coming, and we&#8217;ve got a long way to go to get close to some of those pledges.&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-jose-torres-nbsp-1\"><strong>Jose Torres<\/strong>&nbsp;<\/h3>\n\n\n\n<p>And Michael, to get closer to those pledges, what do you think the economic impact will be? Do you think it\u2019s more of a growth deceleration or more of an inflationary uptick?&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-michael-penn-nbsp-1\"><strong>Michael Penn<\/strong>&nbsp;<\/h3>\n\n\n\n<p>Yeah, I guess climate is first and foremost an environmental issue, but of course, it&#8217;s an economic one too. And you&#8217;re right, there is both a kind of a growth impact and an inflation impact.&nbsp;<br>Even forgetting the projections, we look at what&#8217;s happened over the last couple of years\u2014the numbers are pretty staggering. Last year alone, climate and extreme weather caused about $320 billion of losses globally. Those numbers come from various global insurance companies.&nbsp;<\/p>\n\n\n\n<p>$320 billion of losses\u2014and that\u2019s about 30 percent higher than we saw the previous year, in 2023.&nbsp;<br>And in the U.S. last year, climate events caused about $150 billion of damages, and that\u2019s around two and a half times higher than we saw even a decade earlier. So we&#8217;re already seeing a lot of these impacts come through in terms of the impact on GDP.&nbsp;<\/p>\n\n\n\n<p>And I think if we carry on this path, the impact on the U.S. could be, let&#8217;s say, knocking about 3 percent off GDP per year in 15 to 20 years. And the impact on Asia and Africa\u2014where I think most of the climate damage is expected to be\u2014could be significant. We could be talking about slashing growth by around a third or more.&nbsp;<\/p>\n\n\n\n<p>You mentioned inflation\u2014that&#8217;s the other kind of big impact. So extreme weather events\u2014heatwaves, droughts, floods\u2014big disruption on global food supply chains. And if these shocks continue, they could start to drive inflation rates much higher.&nbsp;<br>So if we\u2019re used to seeing inflation globally of about 2 percent per year, we could be looking at in excess of 3 percent inflation, maybe even 3.5 percent inflation over the next 10 to 15 years. And of course, that will have a big impact on household spending\u2014on budgets\u2014given that households put a lot of money aside for staples like food.&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-jose-torres-nbsp-2\"><strong>Jose Torres<\/strong>&nbsp;<\/h3>\n\n\n\n<p>So from a consumer perspective\u2014you mentioned the budgetary situation\u2014how do you feel about lifestyles\u2026 I&#8217;m repeating that.&nbsp;<br>From a consumer perspective, since we&#8217;re talking a little bit about household budgets here, are lifestyles required to change significantly to achieve the net-zero goal?&nbsp;<br>How about for corporates and governments? Must they make drastic changes for net-zero?&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-michael-penn-nbsp-2\"><strong>Michael Penn<\/strong>&nbsp;<\/h3>\n\n\n\n<p>Yeah, that&#8217;s a great question. So look, pollution is often referred to by economists as an <em>externality<\/em>. That means that when we engage in activities like driving a car or flying, we create pollution\u2014and that imposes costs on the planet that aren&#8217;t reflected in the prices that we pay for those goods and services.&nbsp;<br>Now, some of those costs are obvious, like driving a car or flying on a plane, but there are lots of hidden sources as well. If you think about the carbon that\u2019s embedded in transporting the food to the grocery store, and then you buy the produce there\u2014or the coal that&#8217;s used to create steel that is then used for the buildings that we live or work in.&nbsp;<\/p>\n\n\n\n<p>So, carbon is embedded in everything that we consume. And I think really, if we want to change that\u2014if we want to really think about change\u2014then we need to start thinking about putting a price on those carbon emissions, inserting a carbon price.&nbsp;<br>Right now, we&#8217;re getting something for free, which is: we\u2019re polluting and using nature for free. And we can&#8217;t continue to ignore those costs if we want to start to bring\u2026&nbsp;<\/p>\n\n\n\n<p>As soon as you put a price on carbon, you start to incentivize change. Consumers are suddenly saying, &#8220;Hold on, now I&#8217;m having to pay more for my goods and services. Maybe I should look for cleaner alternatives.&#8221;&nbsp;<br>But it&#8217;s expensive. If you want to put a carbon price on at a level which really incentivizes getting toward our climate targets, estimates suggest that could be about $4,500 extra per household. That&#8217;s a tough sell to the public.&nbsp;<br>If I&#8217;m a politician saying, &#8220;Sorry, look, you had something for free. Now you&#8217;re going to have to pay $4,500 a year for no perceivable benefit.&#8221;&nbsp;<\/p>\n\n\n\n<p>So, you know, governments really need to be looking at a much more gradual approach to something like carbon pricing. And there has been success there\u2014the European Union has gradually increased their carbon price. Carbon pricing is something that&#8217;s building globally.&nbsp;<\/p>\n\n\n\n<p>Yes, we do need drastic change. I think we do need to put a price on the carbon\u2014the pollution that we produce\u2014but it\u2019s a very difficult and delicate balancing act for policymakers.&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-jose-torres-nbsp-3\"><strong>Jose Torres<\/strong>&nbsp;<\/h3>\n\n\n\n<p>Michael, $4,500 per year per household could be doable in some of the wealthier countries and the more developed nations, but that number really does point to climate change being a global phenomenon and needing cooperation from some of the emerging countries and some of the nations that are suffering from increased poverty levels.&nbsp;<br>How do we reconcile that? How do we make some of the less fortunate nations be able to cooperate with some of these ambitious goals?&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-michael-penn-nbsp-3\"><strong>Michael Penn<\/strong>&nbsp;<\/h3>\n\n\n\n<p>Yeah, it&#8217;s a great question. And you&#8217;re right\u2014look, these are countries that are growing much more quickly. They have a rising, growing middle class; they\u2019re urbanizing. And with that comes a lot of demand for energy.&nbsp;<br>And when you demand energy, all else equal, that means there\u2019s a requirement to burn fossil fuels. And in a lot of these countries, fossil fuels are much cheaper to deploy than renewables, and they can produce kind of baseload, consistent, reliable energy that sometimes is not possible with intermittent wind or solar\u2014which, when the sun doesn&#8217;t shine or the wind doesn&#8217;t blow, can produce much more volatile streams of energy.&nbsp;<\/p>\n\n\n\n<p>I have a lot of sympathy that these countries are being put under pressure to bring their emissions down at a time when they\u2019re growing very quickly and there\u2019s great demand for increased energy and burning of fossil fuels.&nbsp;<\/p>\n\n\n\n<p>I think there&#8217;s a couple of issues here. One is that a lot of these emerging markets are in the direct firing line of some of the worst physical impacts of climate change\u2014particularly if we think about Asia and Africa. And that is going to stretch their budgets. So, spending on things like disaster recovery, spending money on building resilience\u2014it\u2019s all very expensive.&nbsp;<\/p>\n\n\n\n<p>And so I think a very forward-looking government there would say, \u201cI&#8217;d rather spend the money on building out clean energy now, rather than having to build out more in terms of flood protection and early-warning disaster systems in 20 or 30 years\u2019 time.\u201d&nbsp;<\/p>\n\n\n\n<p>But you&#8217;re right, and I agree, that if you want to try and incentivize these countries, there probably does need to be more in the way of climate finance. So this is transfers of money from the developed countries to emerging economies.&nbsp;<\/p>\n\n\n\n<p>But there&#8217;s a problem there. It&#8217;s not like budgets are not stretched in the U.S., in Europe, and in other developed economies. So you&#8217;re asking people not just to pay the $4,500 a year, but\u2014oh, by the way\u2014we need to transfer yet more money to the Global South to help them with their clean energy rollout. It\u2019s a very tough ask.&nbsp;<\/p>\n\n\n\n<p>These are some big challenges, and they require governments to be thinking decades ahead\u2014not just over the next couple of years. And that&#8217;s a very tough challenge, especially in this current sort of political mood.&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-jose-torres-nbsp-4\"><strong>Jose Torres<\/strong>&nbsp;<\/h3>\n\n\n\n<p>And the political environment in the last few centuries or so, where folks think about the next four years necessarily\u2014or the next eight years\u2014they&#8217;re not really thinking decades out in terms of medium- and long-term goals. A lot of times, because reelection considerations aren&#8217;t consistent with that timeline.&nbsp;<\/p>\n\n\n\n<p>Now, Africa and Asia, like you said, Michael, are more exposed to climate change risk, but here in the U.S., we&#8217;ve seen some significant hurricanes in the Southeast, we&#8217;ve seen wildfires, we&#8217;ve seen the cost of living increase for many factors\u2014but one of the factors has also been insurance premiums.&nbsp;<br>How do you\u2026 how would you\u2026 how do you see how the U.S. is handling the climate change dynamics and disaster recovery, as well as insurance premiums?&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-michael-penn-nbsp-4\"><strong>Michael Penn<\/strong>&nbsp;<\/h3>\n\n\n\n<p>Sure. So look, you&#8217;re right. On a global level, the U.S. is actually quite well positioned\u2014certainly relative to Africa and some areas of Southeast Asia.&nbsp;<br>But of course, it&#8217;s not just a story of the country. It&#8217;s the kind of states, it\u2019s the counties within. We&#8217;ve seen just from the wildfires in California or hurricanes and climate-related events in Florida that the U.S. is almost like a continent. And within that, you have lots of different states, which are like individual countries that all have their own exposures to climate risk.&nbsp;<\/p>\n\n\n\n<p>And probably the best side of that is through the increase in insurance premiums. Now, understandably, for the riskiest properties, you have seen insurance premiums rise. And some of those riskiest properties have been in the direct firing line of some of the issues that you&#8217;ve mentioned.&nbsp;<\/p>\n\n\n\n<p>I guess the safest insurance policies have remained roughly unchanged as we think about the premiums that are paid over the last two or three years.&nbsp;<br>I think if you were to split properties into five different groups, you&#8217;d say the bottom\u2014the sort of safest 20%\u2014the average annual premium is, I think, just over $2,000 a year. But if you look at the riskiest properties\u2014the top sort of 20% of properties\u2014you\u2019ve seen big increases.&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-michael-penn-nbsp-5\"><strong>Michael Penn<\/strong>&nbsp;<\/h3>\n\n\n\n<p>The average premium is now about $3,500 a year. That\u2019s about a 20 percent jump just in the last couple of years. On the one hand, I think you&#8217;d say the market is working\u2014insurance premiums are rising, and the market is giving the correct signals.&nbsp;<br>But there&#8217;s a broader issue here with the way that subsidies work. So, when insurers pull out of certain states\u2014and we&#8217;ve seen some insurers pull out of insuring properties in California, which is probably the best and most public example of that\u2014when insurers pull out, that really should be a sign that the market is saying, \u201cLook, there&#8217;s a risk that needs to be priced here.\u201d&nbsp;<\/p>\n\n\n\n<p>And the problem is that when local governments step in, that&#8217;s breaking the link between the market and the climate signal. And so what you&#8217;re doing is, ultimately, you&#8217;re putting the strain\u2014you\u2019re moving it from the insurer to the government, and then ultimately to the taxpayer.&nbsp;<br>So, even if I&#8217;m in a kind of low-risk property, my costs are still going up because I&#8217;m now having to pay more tax to cover the local government that has had to step in. I still think there are lots of issues with the way that the insurance market is operating in the States in terms of giving those kinds of climate risk signals.&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-jose-torres-nbsp-5\"><strong>Jose Torres<\/strong>&nbsp;<\/h3>\n\n\n\n<p>Yeah, in Florida, where I&#8217;m at here today, many insurance providers as well have also left, and the only one remaining for a lot of new policyholders is one that\u2019s subsidized by the state. And now the state, Michael, is talking about possibly removing property taxes. That\u2019s going to be interesting from a municipal finance perspective, I think.&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-michael-penn-nbsp-6\"><strong>Michael Penn<\/strong>&nbsp;<\/h3>\n\n\n\n<p>Yeah, absolutely. And I think this is exactly it. You&#8217;re just socializing the climate risk\u2014you\u2019re taking it from the private insurer to the state, or even to the federal level. And everyone\u2019s going to end up paying for that.&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-jose-torres-nbsp-6\"><strong>Jose Torres<\/strong>&nbsp;<\/h3>\n\n\n\n<p>And Michael, the way real estate values in the United States have trended\u2014the gateway cities happen to be on the coasts. Climate change presumably means that\u2019s elevated risk. So that\u2019s going to be interesting when you consider New York, Philadelphia, Washington, Miami, Los Angeles, San Francisco.&nbsp;<br>What can local governments do? We hear a lot about enforcing stronger building restrictions. We hear sometimes about sea walls and dams.&nbsp;<br>What are some things you can do\u2014maybe some other, modern measures that some of these local governments can do\u2014that perhaps some of the more emerging countries can also begin to emulate and maybe fortify their geographies against climate change?&nbsp;<br>Or are the forces of climate change so significant that the measures of the local governments won\u2019t be able to match up?&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-michael-penn-nbsp-7\"><strong>Michael Penn<\/strong>&nbsp;<\/h3>\n\n\n\n<p>Yeah. I\u2019d say the first one is to let the market signals operate as they should. Stepping in\u2014if an insurance company does not want to insure an oceanfront property\u2014that\u2019s telling you that there\u2019s a problem. And no one has as good data on flood risk, on wildfire risk, as the insurance companies.&nbsp;<br>So I think the first thing is to let the insurance market and the pricing from insurance do the job that it\u2019s supposed to.&nbsp;<\/p>\n\n\n\n<p>But outside of that, I agree\u2014it\u2019s things like flood defenses, early warning systems. Obviously, the U.S. is very far advanced in a lot of these technologies, certainly relative to a lot of emerging markets. So, to some extent, you can try and address some of these issues.&nbsp;<\/p>\n\n\n\n<p>But there are lots of other things that it\u2019s very difficult for governments to necessarily step in on. Probably the best example I can think of\u2014something outside of U.S. control\u2014is what happened with the Panama Canal last year.&nbsp;<br>So, we saw Panama have one of the worst droughts in a century. That meant that water levels were very low. The Panama Canal fell to record low levels. And of course, the Panama Canal is very important for the U.S., very important for trade. I think it\u2019s responsible for something like 6 percent of all global trade.&nbsp;<\/p>\n\n\n\n<p>Now, that\u2019s upstream from the U.S., so there\u2019s only a limit to the amount that, let\u2019s say, a government or a local government can do when it\u2019s downstream to some of these supply chain issues. Sometimes you\u2019re really at the mercy of what other governments are doing, or at the mercy of the physical climate risk.&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-jose-torres-nbsp-7\"><strong>Jose Torres<\/strong>&nbsp;<\/h3>\n\n\n\n<p>Which economic sectors do you think are going to benefit from climate change, and which ones will be most adversely impacted?&nbsp;<br>Off the top of my head, I&#8217;d imagine that fossil fuels and traditional energy production would probably be less buoyant in the next 30 to 50 years, and energy efficiency and modernized energy\u2014I\u2019d imagine that would be more robust. What do you think?&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-michael-penn-nbsp-8\"><strong>Michael Penn<\/strong>&nbsp;<\/h3>\n\n\n\n<p>Yeah, it\u2019s a great question. I think the first thing to do is to separate\u2014&nbsp;<br>You\u2019ve got two elements of climate change here, right? You\u2019ve got the physical risk elements of climate change, and then you have anything to do with the energy transition. So it&#8217;s really important to separate both winners and losers as you think about those two elements.&nbsp;<\/p>\n\n\n\n<p>So when it comes to the physical side of climate change\u2014we\u2019ve talked about it a lot\u2014but I think real estate is probably the most obvious sector that\u2019s in the direct firing line: extreme weather events, insurance costs as we discussed.&nbsp;<\/p>\n\n\n\n<p>There are also beneficiaries of rising physical climate risk. So if you think about investing in sectors like water, agricultural technology\u2014these are companies that are developing some really interesting solutions to address issues like water scarcity or food security. A great example is something like vertical farming, or bioengineering when it comes to crops, to make them more drought-resistant.&nbsp;<br>So those are some of the industries that could actually benefit from more physical climate risk.&nbsp;<\/p>\n\n\n\n<p>And then you have the second element\u2014anything to do with the energy transition. So, some of the sectors that you mentioned.&nbsp;<\/p>\n\n\n\n<p>Now, if you believe that we\u2019re going to face a very quick transition and we\u2019re going to reach some of our net-zero targets, then yes, you would want to sell out of oil, gas, fossil fuel companies.&nbsp;<br>But certainly, if you look at the way that the transition is unfolding, and a lot of governments are maybe taking a step back from transitioning away from fossil fuels, there\u2019d certainly be an argument to say,&nbsp;<br>\u201cI\u2019m skeptical that this transition is happening at the speed that I would like, so I\u2019m quite happy to remain invested in oil and gas companies for the time being. I\u2019m skeptical on solar, wind, or electric vehicles.\u201d&nbsp;<\/p>\n\n\n\n<p>Now, of course, I mentioned the carbon price. A carbon price would be a real game-changer here, because suddenly, if you\u2019re a consumer and you\u2019re looking for ways to bring your cost down, you\u2019re looking for clean alternatives.&nbsp;<br>So suddenly, things like solar and wind or an electric vehicle look a lot more competitive than their fossil fuel equivalents. But I think without putting a price on carbon, the fossil fuel provision of energy is going to be around for a long time to come.&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-jose-torres-nbsp-8\"><strong>Jose Torres<\/strong>&nbsp;<\/h3>\n\n\n\n<p>Thanks so much for joining me today. Michael Penn is the Head of Climate Strategy at Absolute Strategy Research (ASR).&nbsp;<\/p>\n\n\n\n<p>And Michael, you&#8217;re a really interesting guest because you bring a lot of climate knowledge with a past in Wall Street economist kind of experience\u2014and that\u2019s a really impressive bridge to cross.&nbsp;<\/p>\n\n\n\n<p>Folks, you all could probably tell\u2014I am not a climate expert. Michael is. And it\u2019s really great to be able to have you here, Michael, and bring that Wall Street experience that, here at Interactive Brokers, we listen to all the time\u2014we\u2019re familiar with.&nbsp;<br>But today, you really brought the climate aspect, which is a new development that we&#8217;re trying to bring into the <em>Forecast Trader<\/em> and <em>Traders&#8217; Insight<\/em> and <em>Traders&#8217; Academy<\/em>, and all the products that we have here.&nbsp;<\/p>\n\n\n\n<p>So Michael, thanks a lot for your time today.&nbsp;<\/p>\n\n\n\n<p>Folks, don\u2019t forget to like and subscribe\u2014IBKR Interactive Brokers Podcasts\u2014wherever you listen and digest these podcast episodes.&nbsp;<br>Thanks so much for joining us, and we look forward to seeing you on the next episode. Thank you.&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Climate change is accelerating \u2014 and the economic fallout is already here. 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