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Divesting from profitable companies is against the most important incentive of all (profit/money/value). The real solution is to implement carbon taxation glob

Divesting from profitable companies is against the most important incentive of all (profit/money/value). The real solution is to implement carbon taxation globally via trade blocs/agreements and then suddenly the incentives are structured in a way that might actually accomplish something. No amount of divesting is going to accomplish anything. It just makes profitable oil companies a more attractive buy. Which then begs the question… why is this news? Large funds selling unprofitable companies isn’t usually newsworthy outside of finance papers. The fact that we’re reading about it at all almost implies it’s nothing but virtue signalling.

klyrs 5y ago
> Divesting from profitable companies is against the most important incentive of all (profit/money/value). I dunno, some might consider long term survival of the species more important.
- relax88 5y ago
  What does money represent but the value that humans ascribe to things? We aren’t all willing to pay the same price for certain things, but we all know that we can get more of what we value by getting more money. Fighting against this is like trying to swim up a waterfall. This is why carbon taxation or cap and trade style policy is the the only scalable non-technical solution.
  - munk-a 5y ago
    I think your first line is pretty provably false - "Money can't buy you love" exists as a saying for a reason, some goods and services aren't translatable into monetary values so while money represents the value that humans ascribe to a lot of things it isn't all encompassing. And if you don't like the "soft" counter argument above then externalized costs also nibble away at an understanding that money represents the value we ascribe to costs. I do think that carbon taxation is probably the best resolution to pursue - bringing all those long ignored factors into the actual costs of goods forces the market to respond them - however other approaches to speed this process along (and bridge areas of the world where taxation is politically difficult) seems wise as well.
    - relax88 5y ago
      It’s definitely not false. The entire purpose of money to exchange human ascribed value across space and time. People try to buy love all the time, and if they could purchase the real thing they would likely pay a lot for it. Just because something isn’t for sale doesn’t mean it’s value can’t be compared relative to other things. How much would you personally be willing to pay to limit the warming of the Earth to 1.5C?
      - klyrs 5y ago
        > How much would you personally be willing to pay to limit the warming of the Earth to 1.5C? Nearly all of my money, if I thought it would actually work, but that's not even half a million canadian. If Jeff Bezos felt the same as me, he could effect significantly more change than I could. Money doesn't represent what "people" value, it represents what the very richest people value.
wallacoloo 5y ago
> No amount of divesting is going to accomplish anything. It just makes profitable oil companies a more attractive buy. Are you certain? In a world of high P/E ratios across the board, profitability is achieved more via appreciation than via dividends. People (e.g. myself) shy away from investing in falling assets, even if their dividend yields are 1% higher than that of the stable or rising asset. Maybe those looking at a 15 year time horizon will see the value and buy despite this, but many people today see it as foolish to try to predict — and therefore invest solely for — 15 years into the future. It’s one of the reasons you don’t see as much short selling as would be maximally profitable in bubbles, for example (eating a couple years of loss and hanging on until the windfall is tough — not just psychologically, but also to your investors who expect consistent returns). I’ve seen arguments both ways though. Perhaps what’s needed at this point is a study, or something with a more formal treatment of the numbers. But without those I don’t think your view should be taken as conclusive.

klyrs 5y ago

> Divesting from profitable companies is against the most important incentive of all (profit/money/value). I dunno, some might consider long term survival of the species more important.

relax88 5y ago
What does money represent but the value that humans ascribe to things? We aren’t all willing to pay the same price for certain things, but we all know that we can get more of what we value by getting more money. Fighting against this is like trying to swim up a waterfall. This is why carbon taxation or cap and trade style policy is the the only scalable non-technical solution.
- munk-a 5y ago
  I think your first line is pretty provably false - "Money can't buy you love" exists as a saying for a reason, some goods and services aren't translatable into monetary values so while money represents the value that humans ascribe to a lot of things it isn't all encompassing. And if you don't like the "soft" counter argument above then externalized costs also nibble away at an understanding that money represents the value we ascribe to costs. I do think that carbon taxation is probably the best resolution to pursue - bringing all those long ignored factors into the actual costs of goods forces the market to respond them - however other approaches to speed this process along (and bridge areas of the world where taxation is politically difficult) seems wise as well.
  - relax88 5y ago
    It’s definitely not false. The entire purpose of money to exchange human ascribed value across space and time. People try to buy love all the time, and if they could purchase the real thing they would likely pay a lot for it. Just because something isn’t for sale doesn’t mean it’s value can’t be compared relative to other things. How much would you personally be willing to pay to limit the warming of the Earth to 1.5C?
    - klyrs 5y ago
      > How much would you personally be willing to pay to limit the warming of the Earth to 1.5C? Nearly all of my money, if I thought it would actually work, but that's not even half a million canadian. If Jeff Bezos felt the same as me, he could effect significantly more change than I could. Money doesn't represent what "people" value, it represents what the very richest people value.

wallacoloo 5y ago

> No amount of divesting is going to accomplish anything. It just makes profitable oil companies a more attractive buy. Are you certain? In a world of high P/E ratios across the board, profitability is achieved more via appreciation than via dividends. People (e.g. myself) shy away from investing in falling assets, even if their dividend yields are 1% higher than that of the stable or rising asset. Maybe those looking at a 15 year time horizon will see the value and buy despite this, but many people today see it as foolish to try to predict — and therefore invest solely for — 15 years into the future. It’s one of the reasons you don’t see as much short selling as would be maximally profitable in bubbles, for example (eating a couple years of loss and hanging on until the windfall is tough — not just psychologically, but also to your investors who expect consistent returns). I’ve seen arguments both ways though. Perhaps what’s needed at this point is a study, or something with a more formal treatment of the numbers. But without those I don’t think your view should be taken as conclusive.