Wednesday, April 15, 2020 03:07 PM / by Micheal Kern of
Oilprice.com/ Header Image Credit: Oilprice
The coronavirus pandemic is one of the biggest and unprecedented seismic shifts
in the global economy that we've ever seen in modern history, and it's just
Already, economies around the world are shutting down. The federal reserve has
pumped trillions into the United States economy in just a matter of days.
Global supply chains have collapsed as entire Chinese industries went dark. And
this is just the first stage. We're heading into a year's long recession that will have far-reaching
consequences, some of which we can predict with near certainty, and some of
which will be entirely unpredictable.
Of course, the global economic system has seen major shakeups before. The
timespan known as modern history, in official terms, begins with the onset of
the industrial revolution. The globalized market economy that we live in today
is all thanks to the revolution that started in Great Britain in the late 18th
century, which mechanized manufacturing and made mass production possible.
Likewise, in only slightly lesser terms, our current political economy wouldn't
be what it is now without World Wars I and II, the Green Revolution, and the
invention of the internet.
So no, market shocks and economic recalibration are nothing new. But with each
passing year, the world's economy becomes increasingly intertwined and
interdependent. Globalization grows stronger and more widespread all the time,
meaning that every economic shakeup anywhere on earth will only have more and
more far-reaching consequences as we move forward. The evidence is
For those of us that have grown up against the backdrop of the 2008 recession,
Arab Spring, Occupy Wall Street, to name just a few economic shakeups, crises,
and movements, not to mention the looming omnipresent dread of the existential
hyperobject that is climate change, it seems that, in many ways, the neoliberal
economic trajectory that we are on has reached its limits and dropped us off at
the doorway to Armageddon.
Hyperbole? Maybe. But spend five minutes on the internet and you'll see that
it's a common sentiment.
In October of last year, protests, riots, and uprisings were fomenting and
blooming like so many fireworks across the globe. "In Lebanon they are
against a tax on WhatsApp and endemic corruption. In Chile, a hike in the metro
fare and rampant inequality. In Hong Kong, an extradition bill and creeping
authoritarianism. In Algeria, a fifth term for an aging president and decades
of military rule," the Guardian wrote at the time. "The protests raging today and in
the past months on the streets of cities around the world have varying
triggers. But the fuel is familiar: stagnating middle classes, stifled
democracy and the bone-deep conviction that things can be different â€“ even if
the alternative is not always clear." And now? Well, a global pandemic
certainly isn't improving the mood. And there's likely more to come in the not
so distant future.
Scientific American reports that we can expect a lot more pandemics in our
future, as urbanization, suburban sprawl, deforestation, and overpopulation
have worn down the spatial barriers between humans and wild animals.
"We invade tropical forests and other wild landscapes, which harbor so
many species of animals and plants-and within those creatures, so many unknown
viruses," David Quammen, author of Spillover: Animal Infections and the
Next Pandemic, wrote in the New York Times back in January.
"I am not at all surprised about the coronavirus outbreak," disease
ecologist Thomas Gillespie, associate professor in Emory University's
Department of Environmental Sciences, told Scientific American. "The
majority of pathogens are still to be discovered. We are at the very tip of the
"We made the coronavirus pandemic," reads a New York
Times headline from January. "It may have started with a bat in a cave,
but human activity set it loose." When logging, mining, drilling, shopping
malls, and apartment buildings have set us up for not just one apocalypse but
an accelerating series of worsening apocalypses, it's time for a change. And a
new generation of investors, innovators, scientists, and scholars, are ready
The coronavirus crisis has paved the way for one of the biggest shifts in
capital reallocation that the world has ever seen. This new generation of investors
is working with an urgency never felt before, because they believe that they're
the last line of defense to save the world.
Hyperbole? Probably not.
Look no further than the starry-eyed, revolutionary ideas of Elon Musk and the
geniuses of Silicon Valley, and then consider that these are the old guys.
Going forward, green energy, decarbonization, social justice, appropriate
governance, sustainability, resilience, climate-smart investment, and equal
rights won't just be buzzwords, they will actually be on the corporate agenda.
Continuing to pour money into Big Oil and Big Pharma will no longer be
Investors are already using their money as a voice for change. The ESG or
Environment, Sustainability, and Governance investment niche already has over
$30 trillion in assets under management. It's now more than a trend. It's the
And a small Canadian company with big ambitions knows this all too well. Facedrive is
looking to take on some of the biggest names in transportation with a simple,
but important philosophy: "take something as simple as hailing a ride and
turn it into a collective force for change." The company is actively
taking control of its place in this movement and helping shape a better world.
More importantly, it's marketable. A key feature that has been missing from the
adoption of greener alternatives.
Facedrive is a local company bringing its values to the main stage. Its message
has traction. It's already partnering with major international names and
capturing investor attention in a way that other companies dream they could.
This is not about politics. It's about logic and a healthy dose of realism. And
that's exactly what makes Facedrive so genuine and accessible. Sure, business, as
usual has made a lot of money for a lot of people and has driven incredible
innovation and some of the best quality of life in human history. Yes, an oil-powered
industrial complex has paved the way for modern medicine that have saved untold
millions if not billions of lives, food systems that have staved off widespread
famine, and we now live with the comforts of electricity, heat and
air-conditioning, air travel, and thousands of other nearly objective
improvements to our daily lives. (In the first world, that is.) But now we must
reckon with the unintended externalities of all of this economic growth. Our
soil is degraded, our oceans are polluted and acidifying, we're losing
biodiversity at breakneck speed, and the earth is getting warmer. Investors, if
they are smart, will start investing in the future, not in the cash cows of the
Few can attempt to deny that this is the direction that the global political
economy is heading. Consumers are savvier, the stakes are higher, and business
simply can't go on as usual. It's just a matter of time before a fossil-fuel
based economy peters out, whether we reach peak oil by exploiting the global
reserves or whether demand simply fades away as renewable energies become more
efficient and more cost-effective. Solar and wind power are already cheaper
than coal in most of the world, and they're getting cheaper all the time.
Much of the developed world, with Canada, in particular, leading the charge,
are already taking major strides towards decarbonizing their energy industries.
Even cleaning up transportation with efforts like Toronto's electric bus
initiative, or even local companies like Facedrive
making waves with greener solutions to some of our biggest challenges. And
let's not discount the researchers around the world racing to improve green
energies and find a solution to unlock the solution to the green energy holy
grail that is nuclear fusion. These efforts are all finally starting to be
taken seriously, getting the attention, and maybe more importantly, the
investments they need to push their visions further by the day.
Heck, even Saudi Aramco had to admit that peak oil is due by midcentury in
documents shared as part of their initial public offering last year. Yes, to be
sure, their IPO was the biggest in history, and fossil fuels continue to make
big money for their investors--but for how much longer? And what of all those
in the middle and lower classes that are not only not reaping any significant
economic benefits from the current investment agenda, but are often actively
suffering from it, either directly by market squeezes and a widening wealth
gap, or indirectly by environmental and health externalities that the global
poor routinely bear the burden of.
Last year's protesters in Chile, Hong Kong, Algeria, Iraq, Iran, and Lebanon
may not have known exactly what kind of change they wanted, but there are
people that do. And a good number of those people are the new class of
investors who give a damn.
Clean energy and climate-friendly technologies have long been bottlenecked at the research and development level because
there simply wasn't enough investment money. But that's changing, and it's
changing rapidly. Some of the deepest pockets in the world are diving into
renewable energies in a way that would have sounded like a fairy tale even five
to ten years ago. The big four of Silicon Valley and the tech industry as a whole
have been pouring money into the renewables sector.
Take Google (GOOGL), for example. Despite being one of the
largest companies on the planet, in many ways it has lived up to its original
"Don't Be Evil" slogan. Not only is Google powering its data centers
with renewable energy, it is also on the cutting edge of innovation in the
industry, investing in new technology and green solutions to build a more
sustainable tomorrow. It's bid to reduce its carbon footprint has been well
received by both younger and older investors. And as the need to slow down
climate change becomes increasingly dire, it's easy to see why.
Social media giant Facebook (FB) is doing its part, as well. Not only
have they made dramatic progress towards their goal to run on 100% renewable
energy by the end of 2020, they're working to build more water-efficient data
centers. In fact, their data centers use 80 percent less water than typical
Not to be outdone, Apple (AAPL) has made significant moves towards
renewables, as well. All of Apple's operations run on 100% renewable energy. "We proved that 100 percent
renewable is 100 percent doable. All our facilities worldwide-including Apple
offices, retail stores, and data centers-are now powered entirely by clean
energy. But this is just the beginning of how we're reducing greenhouse gas emissions
that contribute to climate change. We're continuing to go further than most
companies in measuring our carbon footprint, including manufacturing and
product use. And we're making great progress in those areas too," CEO Tim
(AMZN), for its part, is not carbon neutral quiet yet, but it
is making massive moves to clean up its act. It pledges to be fully carbon
neutral by 2040, and it is buying up 100,000 electric delivery vehicles to get
there. Not only that, but it has also built a 253 MW wind farm in Scurry
County, Texas, generating over one million megawatt-hours of electricity
Even Big Oil supermajors have been dipping their toes into the sector to
diversify their portfolios and hedge their bets in the rapidly changing
cultural and economic zeitgeist. Total (TOT) maintains a â€˜big
picture' outlook across all of its endeavors. It is not only aware of the needs
that are not being met by a significant portion of the world's growing
population, it is also hyper-aware of the looming climate crisis if changes are
not made. In its push to create a better world for all, it has committed to
contributing to each of the United Nations' Sustainable Development Goals. From
workplace safety and diversity to societal progression and reducing its carbon
footprint, Total is checking all of the boxes that the next generation of
investors hold close to their hearts.
greener future is not a political statement. Improving dirty business practices
is not bipartisan. No matter who you are and what you believe in, it only makes
sense to invest in the future. And there is no future without a serious
reallocation of capital. Donâ€™t bother trying to fight it. The investment
revolution is now.
- WEO: Global Economy is Projected to Contract By 3% in 2020 - IMF
COVID-19 Tragedy into Opportunity for a New Nigeria
Statements By The MPC Members At The 129 MPC Meeting of Mar 23-24, 2020
- What Would the World Look Like after Coronavirus: Economically,
Politically and Socially?
- World Bank Warns African Countries Copying Western Anti-COVID-19
Executive Board Approves Immediate Debt Relief for 25 Countries
President Muhammadu Buhari Extends Lockdown In Abuja, Lagos and Ogun For
Another 14 Days
- World Bank Readies $160bn Emergency Aid Package
- African Development Bank Group Unveils $10bn Response Facility to
- COVID-19: Federal Government of Nigeria Announces Fiscal Stimulus