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The Investment Secrets of Al Gore

49 points by yurisagalov 11y ago

zbyte64 11y ago
"Generation’s best-known analysis is its 2013 report asserting that coal and petroleum reserves were “stranded assets” whose theoretical market value would never be realized, because environmental, legal, technological, and market constraints would inevitably prevent much of that carbon from being sold and burned." That might be another motivating factor for the Saudi's to sell their oil cheaply. Sell as much as you can now because the future market will be more hostile.
- adventured 11y ago
  From time to time they talk about it candidly, the recognition that the electric vehicle shift poses a huge threat to oil demand as a whole (typically interwoven with a discussion on solar or renewables in general). All sorts of knock-on effects occur if you remove 1/3 of a market. Saudi has around ~268 billion barrels of oil. They're producing at 10.x million barrels per day currently (let's say 3.8 billion barrels per year). Estimated reserves are almost always wrong to the low side, at least in the prior century projections were overwhelmingly that way. Saudi might have a century of oil production left at these levels. I think I'd be happily selling it cheap today as well (and considering their cost basis), I wouldn't want to be dependent on oil in 40 or 50 years, much less 100.
  - barney54 11y ago
    The challenge is that there isn't a single car company making money on electric vehicles. Even Tesla selling their cars at around $100k is still seldom profitable (and when they are it's because of selling credits). It's tough to say that EVs are the future when it isn't clear that anyone can make money selling them.
    - nqzero 11y ago
      part of why they're not profitable is because of the saudis dumping oil, which may well be part of their motivation
      - ams6110 11y ago
        How is that part of why they're (EV manufacturers) not profitable?
        knappe 11y ago
        Easy. There is zero incentive to build a better car when the one you can buy now is so cheap. This is why in the States, SUV sales follow gas prices [0]. [0] - http://www.npr.org/2015/01/05/375201451/car-sales-surged-in-december-capping-a-good-year-for-the-industry http://www.npr.org/2015/01/05/375201451/car-sales-surged-in-...
        mc32 11y ago
        That speaks to the "operating" costs not to the initial "investment" to get the vehicle off the dealer lot. Why can't a manufacturer make a profitable vehicle which is also affordable for the consumer, even at the high-end of the market?
        coupdetaco 11y ago
        The demand for electric vehicles is in part a function of gas prices. The Saudis are cashing out because they feel it is advantageous to keep those prices low and undermine the appeal of alternative energy sources
- kaitai 11y ago
  I have heard this theory from several folks on Wall Street. It is an intriguing lens to look at their behavior with.
- snowwrestler 11y ago
  The Saudi oil minister has essentially said as much. The quote was something like "The stone age did not end for a lack of stones, and the oil age will not end for a lack of oil."
iofj 11y ago
TLDR: a "poor" senator (meaning just ~$2 million throwing away money), gets kicked out of the white house, and connects with loads of high tech firms and big banks and "somehow" gets >100x investment return in ~10 years, or 10x market return (70% per year average) through his hedge fund (the 10x return is on his own money, of course, not on the people who paid him to manage their money, article doesn't state what their return was). Looking up what return he provided for clients in the same period, for one client (NY city/state [2]) it appears he managed to deliver 32% in the 2009-2012 period. Per year that comes out to 9.5%, assuming reinvestment. Keep in mind that plain S&P 500 rose from 90 (SPY approx value in 2009/1/1) to 205 (SPY approx value 2012/6/1), or 233%, or 32% per year. Can someone explain to me why anyone parks even a single penny with this firm ? Although the article does say that it was public funds looking for an "environmentally friendly" way to invest. Some interesting things, apparently ethical investing means mostly tech companies, with Microsoft being the #1 single investment. Generally looks like a run-of-the-mill, a lot riskier than usual (has biotech & tech, he's got to be down 10% for the past month, at least. And if his bond portfolio is this risky, more than 10%), portfolio. [1] http://www.nasdaq.com/quotes/institutional-portfolio/generation-investment-management-llp-733957 http://www.nasdaq.com/quotes/institutional-portfolio/generat... [2] http://www.businessinsider.com.au/al-gores-generation-investment-management-wins-1656-million-nyc-pension-contract-2012-6 http://www.businessinsider.com.au/al-gores-generation-invest...
- lern_too_spel 11y ago
  Did you read the same article I read? It said Gore had a net worth of up to $2 million, which is different from $2 million "throwing away money." 2009-2012 is post-crash. The article says that Generation's global equity fund is not very volatile, perhaps due to its emphasis on long-term prospects, which means it would have worse performance during recovery from a crash but better performance during the crash. This results in the outsized 10 year gains mentioned in the article.
- 1812Overture 11y ago
  The bulk of his money came from co-founding Current TV then selling it to Al Jazeara for an estimated $500 million in 2013. He also made a killing off of getting a bunch of Apple options for serving on their board in the early 2000s.

49 points by yurisagalov 11y ago

"Generation’s best-known analysis is its 2013 report asserting that coal and petroleum reserves were “stranded assets” whose theoretical market value would never be realized, because environmental, legal, technological, and market constraints would inevitably prevent much of that carbon from being sold and burned." That might be another motivating factor for the Saudi's to sell their oil cheaply. Sell as much as you can now because the future market will be more hostile.

adventured 11y ago
From time to time they talk about it candidly, the recognition that the electric vehicle shift poses a huge threat to oil demand as a whole (typically interwoven with a discussion on solar or renewables in general). All sorts of knock-on effects occur if you remove 1/3 of a market. Saudi has around ~268 billion barrels of oil. They're producing at 10.x million barrels per day currently (let's say 3.8 billion barrels per year). Estimated reserves are almost always wrong to the low side, at least in the prior century projections were overwhelmingly that way. Saudi might have a century of oil production left at these levels. I think I'd be happily selling it cheap today as well (and considering their cost basis), I wouldn't want to be dependent on oil in 40 or 50 years, much less 100.
- barney54 11y ago
  The challenge is that there isn't a single car company making money on electric vehicles. Even Tesla selling their cars at around $100k is still seldom profitable (and when they are it's because of selling credits). It's tough to say that EVs are the future when it isn't clear that anyone can make money selling them.
  - nqzero 11y ago
    part of why they're not profitable is because of the saudis dumping oil, which may well be part of their motivation
    - ams6110 11y ago
      How is that part of why they're (EV manufacturers) not profitable?
      - knappe 11y ago
        Easy. There is zero incentive to build a better car when the one you can buy now is so cheap. This is why in the States, SUV sales follow gas prices [0]. [0] - http://www.npr.org/2015/01/05/375201451/car-sales-surged-in-december-capping-a-good-year-for-the-industry http://www.npr.org/2015/01/05/375201451/car-sales-surged-in-...
        mc32 11y ago
        That speaks to the "operating" costs not to the initial "investment" to get the vehicle off the dealer lot. Why can't a manufacturer make a profitable vehicle which is also affordable for the consumer, even at the high-end of the market?
      - coupdetaco 11y ago
        The demand for electric vehicles is in part a function of gas prices. The Saudis are cashing out because they feel it is advantageous to keep those prices low and undermine the appeal of alternative energy sources
kaitai 11y ago
I have heard this theory from several folks on Wall Street. It is an intriguing lens to look at their behavior with.
snowwrestler 11y ago
The Saudi oil minister has essentially said as much. The quote was something like "The stone age did not end for a lack of stones, and the oil age will not end for a lack of oil."

iofj 11y ago

TLDR: a "poor" senator (meaning just ~$2 million throwing away money), gets kicked out of the white house, and connects with loads of high tech firms and big banks and "somehow" gets >100x investment return in ~10 years, or 10x market return (70% per year average) through his hedge fund (the 10x return is on his own money, of course, not on the people who paid him to manage their money, article doesn't state what their return was). Looking up what return he provided for clients in the same period, for one client (NY city/state [2]) it appears he managed to deliver 32% in the 2009-2012 period. Per year that comes out to 9.5%, assuming reinvestment. Keep in mind that plain S&P 500 rose from 90 (SPY approx value in 2009/1/1) to 205 (SPY approx value 2012/6/1), or 233%, or 32% per year. Can someone explain to me why anyone parks even a single penny with this firm ? Although the article does say that it was public funds looking for an "environmentally friendly" way to invest. Some interesting things, apparently ethical investing means mostly tech companies, with Microsoft being the #1 single investment. Generally looks like a run-of-the-mill, a lot riskier than usual (has biotech & tech, he's got to be down 10% for the past month, at least. And if his bond portfolio is this risky, more than 10%), portfolio. [1] http://www.nasdaq.com/quotes/institutional-portfolio/generation-investment-management-llp-733957 http://www.nasdaq.com/quotes/institutional-portfolio/generat... [2] http://www.businessinsider.com.au/al-gores-generation-investment-management-wins-1656-million-nyc-pension-contract-2012-6 http://www.businessinsider.com.au/al-gores-generation-invest...

lern_too_spel 11y ago
Did you read the same article I read? It said Gore had a net worth of up to $2 million, which is different from $2 million "throwing away money." 2009-2012 is post-crash. The article says that Generation's global equity fund is not very volatile, perhaps due to its emphasis on long-term prospects, which means it would have worse performance during recovery from a crash but better performance during the crash. This results in the outsized 10 year gains mentioned in the article.
1812Overture 11y ago
The bulk of his money came from co-founding Current TV then selling it to Al Jazeara for an estimated $500 million in 2013. He also made a killing off of getting a bunch of Apple options for serving on their board in the early 2000s.