Latest / Bloomberg Intelligence / BI Weekend: Visa Lawsuit, Climate Week

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BI Weekend: Visa Lawsuit, Climate Week · Bloomberg Intelligence

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Speaker 4: On today's Bloomberg Intelligence Show, we dig inside the big
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Speaker 3: Each and every week we provide in depth research and
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Speaker 4: It is Climate Week, and today we look at how
1:01
Speaker 4: oil and gas are playing into the energy transition.
1:04
Speaker 3: Plus we'll discuss how the resulting emissions from wildfires are
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Speaker 3: threatening to make global warming worse.
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Speaker 4: But first we dive into that anti trust space. This week,
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Speaker 4: the US Justice Department suit the world's second largest card
1:15
Speaker 4: payment organization, Visa, over an anti trust matter.
1:18
Speaker 3: The case was filed in federal court in Manhattan on
1:20
Speaker 3: Tuesday or tild. The US Anti trust enforces have been
1:23
Speaker 3: preparing a case accusing Visa of taking steps to keep
1:26
Speaker 3: rivals from challenging its dominance in the debit card market.
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Speaker 6: And for more.
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Speaker 4: Guest host Jess Menton and I were joined by Justin Teresi,
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Speaker 4: Bloomberg Intelligence, Anti trust litigation and policy analysts. We first
1:36
Speaker 4: asked Justin whether this week's news surprised him at all.
1:39
Speaker 7: The following itself wasn't too surprising. We know that DOJ
1:43
Speaker 7: opened an investigation in twenty twenty one related to Visa
1:46
Speaker 7: and its deepit card practices, so we thought something might
1:49
Speaker 7: be coming. The timing before the election makes sense, we'd
1:52
Speaker 7: see it now rather than later on this year. The
1:55
Speaker 7: complaint itself, it seems fairly strong, as the Attorney General
1:58
Speaker 7: said in his press conference. Basically, they're alleging that after
2:02
Speaker 7: Dodd Frank and rules came into place about being able
2:05
Speaker 7: to route debit transactions over more than one network. Visa
2:09
Speaker 7: entered a series of contracts with merchants and banks that
2:12
Speaker 7: allowed it to favor its own network over those of
2:15
Speaker 7: its competitors. Seems like some true antitrust activity here that
2:19
Speaker 7: DOJ's alleging.
2:20
Speaker 1: When you're thinking about and especially when you were talking
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Speaker 1: about the current administration and the election coming up, do
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Speaker 1: you think a new administration would be able to potentially
2:28
Speaker 1: amend a settlement here.
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Speaker 7: There's a couple of things to consider here, the first
2:32
Speaker 7: being that is that this is not Visa's first time
2:34
Speaker 7: at the antitrust.
2:35
Speaker 8: Rodeo, if you will.
2:37
Speaker 7: The company was back in two thousand and one when
2:40
Speaker 7: it was still linked together with MasterCard before I went public,
2:44
Speaker 7: and that case ended in a settlement. In twenty ten,
2:46
Speaker 7: there was a similar anti trust suit related to credit
2:49
Speaker 7: card fees. That case also ed in a settlement. So
2:52
Speaker 7: there is some history here of these cases tending to settle,
2:56
Speaker 7: and while there or not a new administration might be
2:58
Speaker 7: amenable to that, it really remains to be seen. But
3:00
Speaker 7: I think settlement is certainly something that's on the table.
3:03
Speaker 7: And important to remember in all of this too, is
3:06
Speaker 7: that the DOJ is really after some behavioral changes with
3:09
Speaker 7: regard to these agreements. Right, We're not talking about some
3:12
Speaker 7: kind of a structural change in Visa as a result
3:15
Speaker 7: of this litigation most likely.
3:17
Speaker 4: Right, So then what does that look like? So they
3:19
Speaker 4: can't pay Apple anymore, et cetera. So Apple loses money,
3:22
Speaker 4: and then what does Visa do?
3:23
Speaker 7: Yeah, you know, it's it's a really a great question,
3:26
Speaker 7: and I think one that that really goes to the
3:28
Speaker 7: heart of Visa's debit business here. You know, DJ is
3:30
Speaker 7: alleging that as a result of one hundred and eighty
3:33
Speaker 7: of the largest of these contracts that Visa has, they've
3:36
Speaker 7: been able to shield themselves from competition on seventy five
3:39
Speaker 7: percent of the debit volume that's going through its network.
3:43
Speaker 7: So this is a big money maker for Visa. It's
3:45
Speaker 7: something to really keep our eye on here because it
3:47
Speaker 7: could result in a chalk of its business going away
3:50
Speaker 7: if these contracts were to also go away. So that's
3:53
Speaker 7: really I think what we have to scratch our heads
3:55
Speaker 7: a bad and wonder you know, is that the ultimate
3:57
Speaker 7: remedy that we see from DJ.
3:59
Speaker 8: But lots of time too, you know.
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Speaker 7: Give you an example the Google Search case from filing
4:04
Speaker 7: to trial that was a three year time span before
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Speaker 7: we got there, So this is going to be something
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Speaker 7: that's around for quite a while.
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Speaker 1: Is there any way that Visa could argue that the
4:13
Speaker 1: complaint fails to account for increasing competition from alternative payment
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Speaker 1: methods if you're thinking about account to account transfers.
4:20
Speaker 7: Yeah, and I think that's exactly where we could see
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Speaker 7: Visa go in its motion to dismiss arguments or later
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Speaker 7: on down the line. You're right, we're seeing this increase
4:28
Speaker 7: in competition from things like Venmo or cash app, right,
4:31
Speaker 7: But the complaint is basically alleging that those forums haven't
4:35
Speaker 7: been able to scale up to be as large as
4:38
Speaker 7: they really could be because of deals.
4:40
Speaker 8: They have with Visa.
4:41
Speaker 7: But you know, the reality is, as you and I
4:43
Speaker 7: both know, folks are using those platforms and the marketplace
4:46
Speaker 7: is changing.
4:47
Speaker 8: So I think that's probably going to.
4:48
Speaker 7: Be part of parish parcel to what we see VISA
4:51
Speaker 7: saying in its defense here.
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Speaker 4: How long does something like this take, particularly as Jess
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Speaker 4: was pointing out, we might have a change in administration.
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Speaker 7: Yeah, yeah, again, you know, really these slow moving cases here,
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Speaker 7: I think we really this is going to be something
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Speaker 7: that's around, I would say, for the next two or
5:05
Speaker 7: three years.
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Speaker 8: At a minimum, we're going to get through a ton
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Speaker 8: of motion.
5:08
Speaker 7: To dismiss practice next year likely get over that and
5:10
Speaker 7: find ourselves in a discovery phase.
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Speaker 4: So, so is this like an overhang on the stock
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Speaker 4: then until then?
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Speaker 7: I would say so, I mean, you know, how the
5:18
Speaker 7: stock reacts is how the stock reacts, but the overhang
5:20
Speaker 7: is something that it is a long term risk.
5:22
Speaker 8: I would say that's absolutely accurate.
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Speaker 1: In what ways do you think it would impact visus
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Speaker 1: earnings and revenue outlook?
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Speaker 7: Again, you know, I think we really have to go
5:31
Speaker 7: to the heart of the question here with you know,
5:33
Speaker 7: the actual percentage of debit transactions that Visa has been
5:36
Speaker 7: able to shield itself from competition on. Again, the complaint
5:39
Speaker 7: if it's correct, and again you know, the government's best
5:42
Speaker 7: day is always the day they file their complaint because
5:45
Speaker 7: no one's really responded to it yet. But if the
5:47
Speaker 7: government's correct that Visas shield itself from competition on seventy
5:51
Speaker 7: five percent of its transactions from these largest contracts, that's
5:55
Speaker 7: a significant part of visas actual debit revenue. So that
5:58
Speaker 7: I think is where the concern is coming in. You know,
6:01
Speaker 7: it really goes the heart of Visa's debit business, and
6:04
Speaker 7: we'll have to see what plays out over the next
6:05
Speaker 7: couple of years here with regard to possible remedies or
6:08
Speaker 7: a settlement.
6:08
Speaker 3: Our thanks to Justin Teresi, Bloomberg Intelligence, Anti trust, litigation
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Speaker 3: and policy analyst.
6:13
Speaker 4: One story from the Bloomberg terminal this week that caught
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Speaker 4: our eye was about.
6:16
Speaker 3: Colleges skyrocketing tuition costs. COVID and fewer high school graduates
6:21
Speaker 3: have been straining the survival of smaller American colleges, leading
6:24
Speaker 3: many to shut down. Now some are joining a surprising
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Speaker 3: path mergers and acquisitions.
6:29
Speaker 4: Northeastern University, once known as a Boston commuter school, has
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Speaker 4: even formed a dedicated mergers and acquisitions team with the
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Speaker 4: mission of getting big in a hurry.
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Speaker 3: It's the subject of a Bloomberg Big Take story titled
6:40
Speaker 3: a college taps Wall Street playbook to rival Ivy's on admissions.
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Speaker 4: Guests host Jess Menton and I were joined by one
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Speaker 4: of the authors, Francesca Maglioni, Bloomberg Personal Finance and Higher
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Speaker 4: education reporter and mean first asked Francesca to walk us
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Speaker 4: through the legs of the story.
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Speaker 9: Northeastern University has been known for years as a commuter
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Speaker 9: school mostly attended by low students, and since twenty eleven
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Speaker 9: they've kind of been expanding their brand. They now have
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Speaker 9: fourteen campuses across the world, with three campuses abroad. What
7:11
Speaker 9: we thought was interesting is that since twenty nineteen they've
7:13
Speaker 9: been buying up other struggling schools, kind of tapping in
7:18
Speaker 9: that private equity playbook and get M and A. Yeah,
7:20
Speaker 9: like they've been merging with They've merged with three different
7:22
Speaker 9: schools so far and kind of embedded the North Eastern
7:25
Speaker 9: brand on these schools and now can offer to students like, hey,
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Speaker 9: you can study for a semester in California, you can
7:30
Speaker 9: do a semester in New York. And this is very
7:33
Speaker 9: different from those schools like Princeton and Harvard, which just
7:36
Speaker 9: want to stay small and delete. They want to expand
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Speaker 9: their brand as much as they can.
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Speaker 1: Because there's a lot of schools, especially in the South
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Speaker 1: where I'm from, where you had a lot of magnet
7:44
Speaker 1: schools and then satellite schools, whether it was like the
7:47
Speaker 1: University of Texas or Texas A and M, so you'd
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Speaker 1: have not just the main campuses, say in Austin, Texas,
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Speaker 1: you had ones in say Dallas and outside of that.
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Speaker 1: So I'm wondering is this is there a particular playbook
7:57
Speaker 1: when it comes to kind of like the M and
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Speaker 1: a type of feel it comes to something like this,
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Speaker 1: or is there different not apples and apples.
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Speaker 6: I guess yeah, I guess.
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Speaker 9: What's interesting with the Northeastern is that High D is
8:06
Speaker 9: going through a very hard time. There's a lot of
8:09
Speaker 9: smaller schools that are closing all over the US, and
8:12
Speaker 9: so Northeastern is growing at a time when all these
8:15
Speaker 9: other colleges are shrinking. Colleges are competing for students. The
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Speaker 9: number of students across the US is going to drop
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Speaker 9: by ten percent, the number of students going to college.
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Speaker 1: So why what's the driver there?
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Speaker 6: It's just a demographic cliff and.
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Speaker 1: The costs and it's.
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Speaker 6: Extremely expensive as well.
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Speaker 9: COVID was really bad for the college enrollment numbers as well.
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Speaker 9: And so Northeastern is kind of growing at a time
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Speaker 9: when all these other schools are shrinking. And when looking
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Speaker 9: for schools, they want valuable real estate. The latest acquisition
8:48
Speaker 9: that they have is in New York. Now they have
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Speaker 9: three buildings in Manhattan.
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Speaker 4: Do they buy Marymount or was this part of yes,
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Speaker 4: they don't call it buying because still has its own brand.
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Speaker 9: They just like swallow their liabilities and their assets. There's
9:04
Speaker 9: no exchange of money that changes hands.
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Speaker 10: Interesting, is it working?
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Speaker 4: Like yeah, is this playbook actually helping Northeastern?
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Speaker 6: Yeah, it's working.
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Speaker 9: Northeastern last year had almost one hundred thousand students apply
9:16
Speaker 9: to their university. They've seen their enrollment increase by fifteen
9:19
Speaker 9: percent since twenty nineteen, and they've gone from being just
9:23
Speaker 9: a local, little known brand to being known worldwide.
9:26
Speaker 4: But part of the college thing is like the experience, right,
9:29
Speaker 4: Like you go there and you live there, like maybe
9:31
Speaker 4: you take a semester abroad or something, but like you
9:33
Speaker 4: stay there and it feels a little weird and disjointed,
9:36
Speaker 4: and then all of a sudden be like you're here,
9:38
Speaker 4: and then you're there, and then you're there.
9:39
Speaker 6: Yeah, for sure.
9:40
Speaker 9: That's one of the things that Northeastern will say is
9:42
Speaker 9: changing within higher ed and that's why they've been successful
9:45
Speaker 9: in this moment. They think that students no longer or
9:48
Speaker 9: some students no longer want to, you know, spend four
9:50
Speaker 9: years in one place with a small community, and they're
9:52
Speaker 9: looking to get new experiences and be more practical in
9:55
Speaker 9: terms of their four years. How can this translate into
9:57
Speaker 9: career after college and things like that.
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Speaker 6: So that's another way that they're different from other colleges.
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Speaker 1: Are there other potential universities or colleges that are eyeing
10:05
Speaker 1: this type of model and they may try to do
10:08
Speaker 1: and replicate something similar.
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Speaker 6: Yeah, for sure.
10:10
Speaker 9: Northeastern's told us that they've heard from almost fifty schools
10:15
Speaker 9: that have reached out, kind of interested and either merging
10:18
Speaker 9: with them or learning about their business model. We saw
10:20
Speaker 9: that Vanderbilt has now a campus in Florida that's kind
10:24
Speaker 9: of a school that's trying to do something a little similar,
10:26
Speaker 9: not at the scale that Northeastern is doing it, but
10:28
Speaker 9: there's a lot of schools watching what they're doing right now.
10:30
Speaker 4: Yeah, so is what they're doing also, though different from
10:34
Speaker 4: that Marymount thing, Like I can still go to Marymount here,
10:36
Speaker 4: say in New York City versus Northeastern, and then I
10:39
Speaker 4: go spend a semester in California.
10:41
Speaker 6: Yes, so Marymount is part of their whole plan. Okay,
10:44
Speaker 6: so that is part Right now.
10:45
Speaker 9: They're still Marymount because the merger was just announced, but
10:49
Speaker 9: eventually it'll be Marymount at Northeastern or whatever brand they
10:54
Speaker 9: decide to go with ye.
10:55
Speaker 4: So then I can go to Northeastern and then be
10:56
Speaker 4: like I'm gonna spend a year in New York going
10:57
Speaker 4: in to Marymount, yes Hice, Okay, yeah, yeah, that's just
11:00
Speaker 4: so interesting. It's just a different college experience when like
11:05
Speaker 4: I would think that you go to college, you learn
11:06
Speaker 4: how to like be by yourself, do launder by yourself,
11:08
Speaker 4: get your debt by yourself, beer by yourself, and then
11:12
Speaker 4: like that's it, not like jet setting off to different locations.
11:15
Speaker 4: You know.
11:16
Speaker 3: Our thanks to Francesca Maglioni, Bloomberg Personal Finance and Higher
11:19
Speaker 3: Education reporter.
11:20
Speaker 4: Coming up a conversation with Robbie men In, Singapore's Climate
11:23
Speaker 4: Action Ambassador on sustainable financing in Southeast Asia.
11:26
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Speaker 3: depth research and data on two thousand companies and one
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Speaker 3: hundred and thirty industries. You can access Bloomberg Intelligence via
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Speaker 3: Paul Sweeny.
12:06
Speaker 4: Each week we look at research from Bloomberg BNEF previously
12:09
Speaker 4: known as New Energy Finance. They're the team at Bloomberg
12:12
Speaker 4: that tracks and analyzes the energy transition from commodities to power, transport, industries, buildings,
12:17
Speaker 4: and agricultural sectors.
12:19
Speaker 3: This week, we looked at how oil and gas play
12:21
Speaker 3: into the energy transition.
12:22
Speaker 4: Guest host Normal Linda and I were joined by David Doherty,
12:25
Speaker 4: head of Oil and Renewables Fuels Research, and we first
12:28
Speaker 4: asked him to discuss some of the trends that he's
12:30
Speaker 4: noticed over the past year.
12:31
Speaker 11: Yeah.
12:31
Speaker 12: I mean, if you think of the players in the
12:33
Speaker 12: oil market, they're the energy pros in the world, right.
12:35
Speaker 12: They've got the balance sheet, they've got the skills, they've
12:38
Speaker 12: got the technology, and they're already established, right, so they've
12:41
Speaker 12: got interest in seeing how this develops, how fast it goes,
12:43
Speaker 12: how it impacts their bottom line.
12:45
Speaker 10: Basically, what are the main hold ups in terms of
12:47
Speaker 10: the transition, What are some of the headwinds.
12:50
Speaker 12: I mean, capital is obviously raising capital smarts people in
12:55
Speaker 12: the right jobs in the right place, push back both
12:58
Speaker 12: political and from people.
13:00
Speaker 1: Right.
13:01
Speaker 12: People love the idea, but as soon as it costs money,
13:03
Speaker 12: that's quite a difficult to swallow, especially now in like
13:05
Speaker 12: inflationary times.
13:06
Speaker 4: Right, is the conversation that evs will eventually supplant internal
13:11
Speaker 4: combustion engines and get rid of gas demand. Is that
13:13
Speaker 4: still something that you guys are working with in modeling
13:16
Speaker 4: or has that conversation evolved?
13:18
Speaker 12: It's evolved, I mean that is kind of the trend though. Yeah,
13:20
Speaker 12: when you look at things when they're cheaper upfront, right,
13:23
Speaker 12: consumers tend to shift towards that. If it's cheaper day
13:26
Speaker 12: one for buying an EV versus an internal combustion engine car,
13:29
Speaker 12: and all else is equally, you're probably going to see
13:30
Speaker 12: a shift towards that.
13:31
Speaker 2: Right.
13:31
Speaker 4: So we're really though US centric here and we don't
13:34
Speaker 4: see that in the same way.
13:35
Speaker 10: But elsewhere, is that truly what's happening?
13:38
Speaker 5: Yeah, you are.
13:38
Speaker 12: You're seeing a big uptick in Europe and in China
13:41
Speaker 12: for example, and even here in the US California for example,
13:44
Speaker 12: behave it's much more like a European economy. When we
13:46
Speaker 12: think about the transition to evs, we've seen really high
13:49
Speaker 12: rates of penetration there.
13:51
Speaker 10: What are some of the main themes in market dynamics
13:53
Speaker 10: that your team is focused on right now?
13:55
Speaker 12: Yeah, Like, the rate of this change is interesting. What's
13:58
Speaker 12: happening in different markets? What responses. If you take the
14:01
Speaker 12: US for example, it's a it's a mature market. So
14:04
Speaker 12: when these evs come into the market, you're seeing a
14:05
Speaker 12: decline in gasoline sales versus saying in China where it's
14:09
Speaker 12: like what could have been doesn't necessarily manifest, right, So
14:13
Speaker 12: that turns into then power in your pocket. Right, You're
14:15
Speaker 12: seeing the cost of gasoline isn't coming down even though
14:18
Speaker 12: you're expecting it to a less gasoline being consumed. There's
14:21
Speaker 12: so many more dynamics in just a four wheels on
14:23
Speaker 12: the road situation, right, And.
14:24
Speaker 10: How are all these things impacting the consumer?
14:27
Speaker 12: Yeah, I mean, if you think about costs in your
14:29
Speaker 12: pocket when it comes to driving your card, that's a
14:31
Speaker 12: big thing, particularly here in the US, particularly in an
14:33
Speaker 12: election year. You know, it trickles down into inflation. You
14:35
Speaker 12: get something delivered to your house, the cost of diesel
14:37
Speaker 12: impacts all of these things, so your consumers are super
14:41
Speaker 12: sensitive of anything to do a cost at the moment,
14:43
Speaker 12: and probably the biggest development here in the US it's
14:45
Speaker 12: been interesting is less consumptional gasoline hasn't turned into less
14:49
Speaker 12: prices at it. You know, a lower price at the pump.
14:51
Speaker 10: Why do you think that.
14:52
Speaker 12: Is Well, this is key. This is something we have
14:54
Speaker 12: to think about as you go towards transition. If you
14:56
Speaker 12: pull supply in any scenario, you're going to see a
14:58
Speaker 12: price spike. In the US, we're seeing less refinery production
15:01
Speaker 12: then we have a few years ago. So you're seeing
15:03
Speaker 12: over a million baros per day cut in the last
15:04
Speaker 12: two three years alone. And when you have a less
15:06
Speaker 12: supply of something, even if you have less demand, it
15:09
Speaker 12: really depends on which one goes first and HASP deduct changes.
15:12
Speaker 10: And so what are people thinking when will this all
15:14
Speaker 10: shake out?
15:15
Speaker 12: I mean it's shaking out already. It's already checking out
15:18
Speaker 12: in the fore court when people are buying the car.
15:20
Speaker 12: You're seeing the response some refiners, for example, some big
15:22
Speaker 12: refineries like P sixty six are switching some of their
15:25
Speaker 12: facilities to make things like renewable diesel or sustainable aviation fuel.
15:29
Speaker 12: So people are posturing. Companies are posting for the next five, six,
15:32
Speaker 12: seven years, right, which.
15:34
Speaker 4: Is such a great point because I guess the question
15:36
Speaker 4: then becomes, if we're posturing for the seven or eight years,
15:40
Speaker 4: what does the landscape in your world look like then?
15:43
Speaker 4: I mean everyone seems to say it's a yes, and
15:46
Speaker 4: we need everything above all, And is that how you
15:49
Speaker 4: model it?
15:50
Speaker 12: That is how we model it. In our sort of
15:52
Speaker 12: standard outlook twenty twenty nine, we see peak oil consumption globally,
15:56
Speaker 12: so that's still pretty far out. There's still a lot
15:57
Speaker 12: of growth left.
15:58
Speaker 4: Also, peak doesn't mean the then it goes to zero.
16:01
Speaker 4: I feel like that's something we need to also wraprimind around,
16:03
Speaker 4: like just because it's not increasing, it doesn't mean it's
16:05
Speaker 4: rapidly decreasing.
16:06
Speaker 5: Yeah, you're totally right.
16:06
Speaker 12: Even in like a net zero world, in our modeling,
16:08
Speaker 12: you get about twenty five million boos per day of oil,
16:11
Speaker 12: So you know net zero doesn't mean zero oil.
16:14
Speaker 10: So what does the growth outlook here?
16:17
Speaker 12: You're looking at about four or five million boos per
16:19
Speaker 12: day upside in our inner base case scenario. But lots
16:21
Speaker 12: of things can change that, right. Policies are the main
16:24
Speaker 12: thing to look at, particularly in big markets like the US. Right,
16:26
Speaker 12: the US consumers is about one in every five bowels globally,
16:30
Speaker 12: so if something changes here, the whole market can change.
16:32
Speaker 12: The dynamic is really upended.
16:34
Speaker 4: When we take a look at say China and India,
16:36
Speaker 4: large consumers of energy, obviously, are they jumping from coal
16:40
Speaker 4: to what.
16:41
Speaker 12: You know, gases of transition fuel? We're see seeing them
16:43
Speaker 12: shift towards I was just in Beijing last week, and
16:46
Speaker 12: there's a very different way of looking at the oil
16:48
Speaker 12: market versus if you're down in Texas, Right, it's what's
16:51
Speaker 12: the displacement? Because they need more and more energy, right,
16:53
Speaker 12: they don't want to import that energy, So what can
16:55
Speaker 12: you do domestically In the case of power, that's coal.
16:58
Speaker 12: But we're also seeing in the case of evs, right,
17:00
Speaker 12: LNG trucks, even electric trucks. So we have a lot
17:03
Speaker 12: we can learn from them. But they're just different, very
17:05
Speaker 12: different markets.
17:06
Speaker 4: And how did they get there? Is it because of subsidies?
17:08
Speaker 4: Is it because they were so dependent on coal? Like
17:12
Speaker 4: what leads that transition there differently than say in the US.
17:15
Speaker 12: Yeah, I mean, I think it's dependency on imports. For
17:19
Speaker 12: one example, they've got a lot of national champions, and
17:22
Speaker 12: to be honest, when they say they're going to do something,
17:24
Speaker 12: they do it in Europe and in the US you
17:27
Speaker 12: got to get it through parliament, you got to get
17:28
Speaker 12: it through votes. It's a lot slow over process, and
17:31
Speaker 12: there's less domestic manufacturers like Tesla's a big, big player here,
17:34
Speaker 12: but it's kind of it in China. You've got a
17:36
Speaker 12: lot of big producers, a lot of big industrial champions, right,
17:38
Speaker 12: and they're encouraged by the States and by the city
17:41
Speaker 12: and by incentives.
17:42
Speaker 10: So how do we fit into the bigger international ecosystem.
17:46
Speaker 12: Well, for the US, one of the most important things
17:48
Speaker 12: is it's sort of gasoline production. Machines send a lot
17:50
Speaker 12: of gasoline abroad South America, Europe. Even so there's a
17:55
Speaker 12: change coming along for US refiners basically, and you're starting
17:57
Speaker 12: to see how they just their positioning in a sort
18:01
Speaker 12: of a market leading way.
18:02
Speaker 3: I think our Thanks to David Doherty, head of Oil
18:05
Speaker 3: and Renewable Fuels Research, this.
18:07
Speaker 4: Week, Bloomberg Intelligence broadcasted live from the earth Shot Summit
18:10
Speaker 4: at the Plaza Hotel in New York City.
18:12
Speaker 3: The summit celebrated innovators who are trailblazing solutions to repair
18:16
Speaker 3: our Planet and the event was co hosted by Bloomberg Philanthropies.
18:19
Speaker 4: Guest host Damien Sassaur and I were joined by Robi Menon,
18:22
Speaker 4: Singapore's Ambassador for climate Change.
18:24
Speaker 3: He discussed the global impact of central bank policies and
18:27
Speaker 3: also sustainable finance in Southeast Asia.
18:29
Speaker 4: I first asked Rabbi to reflect on his former role
18:32
Speaker 4: as Managing Director of the Monetary Authority of Singapore.
18:35
Speaker 11: Well, I've been a bit removed from that scene for
18:37
Speaker 11: quite a while now, so, but if I were to
18:40
Speaker 11: reflect back two years ago when we were all facing
18:42
Speaker 11: a surge in inflation globally, and the conventional view at
18:47
Speaker 11: that time, which I subscribed to also was that given
18:51
Speaker 11: how low interest rates were and how easy and accommodative
18:56
Speaker 11: monetary policies have been for ten years, the catch up
18:59
Speaker 11: to tie rates to bring down this inflation is going
19:03
Speaker 11: to be unprecedented. And indeed there are heights in rates
19:05
Speaker 11: and the tightening of monetary policy, including in Singapore through
19:08
Speaker 11: the exchange rate, was quite significant, and I thought this
19:15
Speaker 11: was going to come at the cost of a severe
19:18
Speaker 11: slowdown in economic growth and rise in unemployment. I'm talking
19:22
Speaker 11: globally right, and this has been the case in all
19:26
Speaker 11: previous instances. I think looking back, we've done not too badly.
19:32
Speaker 11: We've avoided major recession in the major economies. There hasn't
19:37
Speaker 11: been any sizeable increase in unemployment, the labor market has
19:41
Speaker 11: been quite resilient, and surely, but surely, you know, we've
19:45
Speaker 11: been bringing down inflation. I think this is a credit
19:49
Speaker 11: to many of my ex colleagues in the central banking world.
19:52
Speaker 11: I will not comment on specific policy moves such as
19:55
Speaker 11: the one they made recently, but I think we should
19:58
Speaker 11: step back and see we actually did not do badly.
20:01
Speaker 11: It could have been much worse to be able to
20:04
Speaker 11: ease this early, but that itself is the right move.
20:09
Speaker 11: I would not come in, but the fact that we
20:11
Speaker 11: were even having this conversation about easing about stimulus, when
20:15
Speaker 11: not too long ago we were fighting inflation. It has
20:18
Speaker 11: come down, so I think this has been quite remarkable.
20:21
Speaker 4: And this also brings sort of the question of climate
20:24
Speaker 4: action and financing that part of the market as well,
20:28
Speaker 4: because part of the conversation here in the US with
20:30
Speaker 4: the Inflation Reduction Act is that that in essence is inflationary,
20:34
Speaker 4: and that the more money that every country spends on
20:37
Speaker 4: greeting stuff, the more you're going to create sort of
20:40
Speaker 4: an inflation bubble.
20:41
Speaker 5: Is that true?
20:42
Speaker 11: From where you sit, I think that that is going
20:46
Speaker 11: to be at best quite short term. Some stimulus through
20:49
Speaker 11: any new investments going into an area of scarcity will
20:54
Speaker 11: create some price pressures and demand pressures against limited supply.
20:59
Speaker 11: But the objective of the Inflation Reduction Act as it is,
21:02
Speaker 11: as is the objective of similar packages in every other country,
21:07
Speaker 11: is to expand the supply capacity. Is to expand the
21:10
Speaker 11: supply capacity for renewables, for cleaner technologies and so on.
21:14
Speaker 11: So yes, in the short term that capacity has not increased,
21:17
Speaker 11: you will get momentary increase in inflation and price pressures
21:20
Speaker 11: as you put in demand. But when the supply capacity increases,
21:23
Speaker 11: that stabilized. So as with any industrial transformation or restructuring,
21:29
Speaker 11: there will be short term price effects, but that should
21:32
Speaker 11: even out once a supply and.
21:33
Speaker 2: Demanded back in.
21:33
Speaker 11: So I don't think there's anything inherently inflationary in these packages.
21:37
Speaker 13: In Singapore's key position along the Malacostrait, it sits between
21:41
Speaker 13: two of the largest polluting countries on the planet, that
21:44
Speaker 13: being China and India. Talk to us about your location
21:47
Speaker 13: in the world, your geostrategic location. How are you addressing
21:50
Speaker 13: those two nations their capability to enact climate change.
21:56
Speaker 11: I think both China and India have huge potential to
22:01
Speaker 11: address a climate challenge, particularly with respect to mitigation and
22:06
Speaker 11: renewable energy. The countries are large. We often forget that
22:11
Speaker 11: China is installing more renewable capacity each year than the
22:15
Speaker 11: rest of the world put together. India is a close second.
22:20
Speaker 11: So these two countries, in terms of their geography, are
22:24
Speaker 11: well endowed to deploy clean energy, but they're going to
22:28
Speaker 11: take time because what we forget is that energy demand
22:30
Speaker 11: in these countries is also increasing rapidly. The energy consumption
22:34
Speaker 11: per capita in China and India is a fraction of
22:37
Speaker 11: that in the West, and there are still many villages
22:41
Speaker 11: without access to electricity. So even as they install solar capacity,
22:45
Speaker 11: they're having to build cold plants and keep their fossil
22:49
Speaker 11: fuel plants running to meet that, which is why they're
22:51
Speaker 11: going to take longer. But surely they will get there
22:55
Speaker 11: because of the inherent capacity for renewable energy. Actually, where
23:00
Speaker 11: more is Southeast Asia because similar situation, rapid growth and
23:05
Speaker 11: energy demand, rise of middle class urbanization, people having access
23:09
Speaker 11: to electricity.
23:10
Speaker 5: You mean Indonesia, Philippines, Vietnam.
23:13
Speaker 11: Yes, all the countries around US, including US, we are
23:17
Speaker 11: in many ways alternative energy disadvantaged single pore, particularly so
23:22
Speaker 11: because we're a small island city state. Imagine New York,
23:26
Speaker 11: you know, deploys clean energy entirely within the city. But
23:31
Speaker 11: even in the countries that are relatively well endowed, they
23:34
Speaker 11: do have challenges with great for instance, is forested mountainous.
23:39
Speaker 11: Laying those transmission lines is not easy, not straightforward, and
23:42
Speaker 11: the distribution of renewable energy capacity is very uneven geographically
23:47
Speaker 11: across Southeast Asia. So I think that's a very bigger challenge.
23:51
Speaker 4: Might be what about financing? We have like thirty seconds left.
23:54
Speaker 4: What's the biggest hurdle to financing all of this?
23:57
Speaker 5: Right now?
23:58
Speaker 11: There is enough private capital in the world to solve
24:01
Speaker 11: the climate crisis. There is enough financing if you look
24:04
Speaker 11: at the annual flows of financial assets well in excess
24:08
Speaker 11: of the funding gap. The problem is you need to
24:11
Speaker 11: find bankable projects at appropriate risk return metrics. And this
24:16
Speaker 11: is why you need blended finance with public capital coming
24:19
Speaker 11: in to catalyze private capital. That synergistic combination is what
24:23
Speaker 11: we need and that will be enough to solve this
24:26
Speaker 11: all right.
24:26
Speaker 3: Thanks to Ravi men On, Singapore's Ambassador for Climate Change.
24:29
Speaker 4: Coming up on the program, a look at policies in
24:31
Speaker 4: the European Green Deal that look to make the European
24:34
Speaker 4: Union climate neutral by twenty fifty.
24:36
Speaker 3: You're listening to Bloomberg Intelligence on Bloomberg Radio, providing in
24:39
Speaker 3: depth research and data on two thousand companies and one
24:42
Speaker 3: hundred and thirty industries. You can access Bloomberg Intelligence via
24:45
Speaker 3: Bigo on the terminal.
24:46
Speaker 4: I'm Bailey Liptoles and I'm Alex Steel, and this is Bloomberg.
24:55
Speaker 2: You're listening to the Bloomberg Intelligence Podcast. Catch us live
24:59
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25:03
Speaker 2: with the Bloomberg Business Act. You can also listen live
25:05
Speaker 2: on Amazon Alexa from our flagship New York station, Just
25:09
Speaker 2: say Alexa Play Bloomberg eleven thirty.
25:13
Speaker 3: I'm Alex Steel and I'm Bailey Lipschaltz filling in for
25:16
Speaker 3: Paul Sweeny.
25:16
Speaker 4: We continue with conversations from our broadcast at the earth
25:19
Speaker 4: Shot Summit at the Plaza Hotel in New York City.
25:22
Speaker 3: The summit celebrated innovators who are trailblazing solutions to repair
25:25
Speaker 3: our planet, and the event was co hosted by Bloomberg Philanthropies.
25:29
Speaker 4: At the event, we looked at the European Green Deal.
25:31
Speaker 4: In the Deal, there is a set of policies that
25:33
Speaker 4: look to make the European Union climate neutral by twenty fifty.
25:37
Speaker 3: To achieve this, the European Commission has pledged to mobilize
25:39
Speaker 3: at least one trillion euros in sustainable finance Investing.
25:43
Speaker 4: Guest host Damien Sassaur and I were joined by Nania Calvino,
25:46
Speaker 4: president of the European Investment Bank, and she talked about
25:49
Speaker 4: the bank's role in the European Green Deal. We first
25:52
Speaker 4: asked Nadia whether the bank is meeting its targets.
25:54
Speaker 14: Yes, well, it's going well, it's going well. We are
25:57
Speaker 14: on track to meet the target of one trillion euros
25:59
Speaker 14: in investment green finance. More than fifty percent of our
26:02
Speaker 14: annual investments go to the climate transition to the green finance,
26:06
Speaker 14: so as to make it a success, a European success,
26:08
Speaker 14: a global success for all of us.
26:10
Speaker 4: But why do I keep hearing then that Europe has
26:13
Speaker 4: more at the stick approach and the US has the
26:15
Speaker 4: carrot approach with the IRA, How did they differ.
26:18
Speaker 14: Well, I think that we have a shared endeavor, you know,
26:20
Speaker 14: which is to ensure that we do this green transition,
26:23
Speaker 14: that we move to a net zero economy, and that
26:26
Speaker 14: this is profitable.
26:27
Speaker 15: Well, my side of things is the carrots.
26:29
Speaker 14: Actually I am the investor, so we are probably we
26:32
Speaker 14: are the largest multilateral development bank in the world. Maybe
26:35
Speaker 14: people don't know. With a six hundred billion balance sheet.
26:38
Speaker 14: Ninety percent of the investments are done in the EU,
26:41
Speaker 14: where we are the largest investor in renewables. We're probably
26:44
Speaker 14: one of the largest investors in renewables in the in
26:47
Speaker 14: the whole world.
26:48
Speaker 5: Well not yet.
26:48
Speaker 13: I mean renewables is a very broad topic, solar, wind, water, nuclear,
26:52
Speaker 13: Talk to us about where you're deploying your balance sheet.
26:54
Speaker 5: I mean, six hundred billions, a lot of money, well.
26:57
Speaker 14: More than fifty percent, as I said, is going to
26:59
Speaker 14: climate finance, and this is sustainable infrastructures, This is sustainable transport.
27:04
Speaker 14: This is also renewables, wind energy, greeds, solar, and also
27:08
Speaker 14: new fuels, the fuels of the future, for example green hydrogen.
27:12
Speaker 14: We're supporting very innovative, large projects, also large traditional infrastructures,
27:16
Speaker 14: and dynamic startups that are really going to be the
27:19
Speaker 14: ones finding the technologies, the breakthrough technologies for all of us.
27:23
Speaker 4: I mean we've seen with hydrogen though that it's hard.
27:26
Speaker 4: That green hydrogen particular is quite hard. I mean Germany
27:30
Speaker 4: had a sort of backtrack from that in particular with
27:32
Speaker 4: the war in Ukraine. In addition, like Oorsid dropped and
27:36
Speaker 4: had to ditch out on a hydrogen project. Can you
27:39
Speaker 4: do hydrogen profitably?
27:41
Speaker 15: And how do you do that?
27:42
Speaker 14: But we have to, we have to because it is
27:44
Speaker 14: can right now, well we are right now. We're investing
27:48
Speaker 14: in a number of projects in Europe which are more
27:50
Speaker 14: having to do with industry hubs. So we are greening
27:53
Speaker 14: industry highly polluting, highly energy intensive, so like a cement
27:58
Speaker 14: industry that yes, still you know, all these large industry
28:03
Speaker 14: so we are.
28:04
Speaker 16: We're seeing, for example, close to port to Report in
28:06
Speaker 16: the south of Portugal, we're going to have a green
28:09
Speaker 16: hydrogen hub, so that's very close to traditional industries and
28:13
Speaker 16: we're helping them become green and also profitable.
28:16
Speaker 15: Likewise in other parts of Europe.
28:18
Speaker 14: You know, we are at the early stages of these
28:20
Speaker 14: new technologies and it is only normal you know that
28:23
Speaker 14: some projects fail, that some projects are succeeding, and that's
28:27
Speaker 14: that's why we are the European Investment Bank is a
28:30
Speaker 14: public investment bank to take the risk, to make sure
28:33
Speaker 14: that patient capital, long term investors are taking those risks,
28:37
Speaker 14: so that also we mobilize private capital and we make
28:39
Speaker 14: this a success.
28:41
Speaker 13: Well, you know, other multi level finance institutions, I mean
28:43
Speaker 13: development banks out for example China, Korea, et cetera, have
28:46
Speaker 13: had a very poor track record of deploying capital profitably.
28:49
Speaker 13: And you know, I know the IIB is different. I
28:50
Speaker 13: know the World Bank Group is very very different. And
28:52
Speaker 13: I know we're talking about perpetual capital, perpetual investments.
28:55
Speaker 5: But the end of the day, you do have to
28:57
Speaker 5: get a return on your investment.
28:58
Speaker 13: So talk to us about which set within the broader
29:01
Speaker 13: renewable space, within the border climate space carry the highest
29:05
Speaker 13: return on investment from your perspective.
29:07
Speaker 15: Well, actually, we are very profitable. Let me be very clear.
29:10
Speaker 14: The fact that we're a public bank doesn't mean that
29:12
Speaker 14: I don't have to deliver for ashholders.
29:14
Speaker 15: So around two billion euros we had in profit last year.
29:17
Speaker 15: We've been profitable since the bank, since its inception.
29:20
Speaker 14: We have a very low return very low level of
29:23
Speaker 14: non performing assets. When I say very low, I mean
29:26
Speaker 14: like zero point four percent.
29:27
Speaker 5: Of our assets.
29:28
Speaker 13: Huh.
29:28
Speaker 15: So it is a very profitable bank.
29:30
Speaker 14: And what we have is a very large balance sheet
29:32
Speaker 14: and very balanced portfolio with large infrastructures, traditional infrastructures which
29:37
Speaker 14: are very profitable, lower risk and also highly risky endeavors
29:42
Speaker 14: like innovative startups or large investments into new green technologies.
29:46
Speaker 14: And that's what's allowing us, I think, to make a
29:48
Speaker 14: difference in making projects bankable at the end of the day.
29:51
Speaker 4: So what have you noticed in terms of if you
29:53
Speaker 4: support a project, does it bring in private investors and
29:56
Speaker 4: private capital at.
29:58
Speaker 15: The end of the day, it does?
30:00
Speaker 14: You know, the European Investment Bank is considered to be
30:02
Speaker 14: a reference in terms of technical expertise in some areas
30:06
Speaker 14: for example green for example health. So once the EiV
30:10
Speaker 14: says yes, I'm going to invest in this project, immediately
30:13
Speaker 14: a number of investors say I.
30:14
Speaker 5: Join, naddie. I'd love to ask you a question.
30:16
Speaker 13: I mean, in my world, the emerging market space, there
30:19
Speaker 13: has been an absolute explosion of sustainable finance vehicles and mechanisms,
30:23
Speaker 13: you know, green bonds, clean bonds, you name it.
30:26
Speaker 5: I'm curious to hear your thoughts about a lot of that.
30:27
Speaker 13: I mean a lot of sovereign nations, a lot of
30:29
Speaker 13: countries are issuing that under this green bond umbrella.
30:33
Speaker 5: You know, do you believe in that?
30:34
Speaker 13: Do you think they're just green washing or are they
30:36
Speaker 13: really deploying that capital in a clean and efficient way.
30:39
Speaker 14: We have to ensure, indeed that the green bond standards
30:41
Speaker 14: around the world are not green washing, and that that
30:44
Speaker 14: should be a top priority. Otherwise, you know, once you
30:46
Speaker 14: lose the credibility, then you lose everything in capital markets.
30:49
Speaker 15: I don't have to explain it to you.
30:51
Speaker 14: So that's why I think we have a very important
30:53
Speaker 14: shared interest in having global standards, you know, the taxonomies
30:58
Speaker 14: that are being developed in different parts of the world.
31:00
Speaker 14: Europe has been a pioneer in that area. Also, the
31:02
Speaker 14: European Investment Bank, by the way, has pioneered green bonds,
31:05
Speaker 14: and we have to make sure that those standards are
31:08
Speaker 14: met and that green investments are really green, so that
31:12
Speaker 14: we make sure that this is providing sufficient finance to
31:15
Speaker 14: close the investment gap.
31:16
Speaker 4: How do you offset your risk? Sorry, how do you
31:19
Speaker 4: offset risk when you're taking on riskier projects?
31:22
Speaker 14: Well, we have a capital base. But generally what we
31:25
Speaker 14: do is that we have riskier and less risky projects,
31:28
Speaker 14: and we mobilize our capital in a very wise manner.
31:31
Speaker 14: You know, sometimes our shareholders and say you should take
31:34
Speaker 14: on more risk because that's what your.
31:35
Speaker 15: Capital is for.
31:36
Speaker 14: But I think that we have a relatively good balance
31:39
Speaker 14: in terms of can you give me.
31:41
Speaker 4: A balance on that, Like what would be considered a
31:43
Speaker 4: low risk project, what we considered a high risk For example, well.
31:46
Speaker 14: An infrastructure in a European country, that is a low
31:50
Speaker 14: risk project. When we're building trains or rolling stock or
31:55
Speaker 14: or a metro or port. I mean this is a
31:58
Speaker 14: I mean we are lending to a sovereign state which
32:00
Speaker 14: has a very high rating, and this is our shareholders.
32:04
Speaker 14: So investments within the EU are considered to be generally
32:08
Speaker 14: lower risk. Or for example, we do also through the
32:11
Speaker 14: financial sector, we do lending to SMEs in.
32:13
Speaker 15: Europe that is very profitable, lower risk.
32:16
Speaker 14: Then if we are investing in a very large project
32:19
Speaker 14: one billion, two billion project in green hydrogen, as you
32:22
Speaker 14: were single, you know.
32:23
Speaker 5: I'd like to take a variation on that question.
32:25
Speaker 13: That's important because you're right, it's a lot of these small,
32:27
Speaker 13: medium enterprises. They're the ones who are actually proactively, you know,
32:31
Speaker 13: taking risk in the market. What sort of risk hedges,
32:35
Speaker 13: transmission vehicles, carbon credits, offsets can they take advantage of,
32:39
Speaker 13: I mean, what's available to them to help offset their
32:41
Speaker 13: risk in the space.
32:43
Speaker 14: But what we do is we provide guarantees and portfolio
32:46
Speaker 14: guarantees or other sort of financial support to the banks
32:51
Speaker 14: so that they can lend to SMEs with lower interest rates.
32:54
Speaker 15: That's basically what we do and.
32:56
Speaker 14: Again that allows us to reach a large share of
33:00
Speaker 14: Europeans means and there, for example now investing in green technologies,
33:05
Speaker 14: energy efficiency thanks to the support of the European Investment Bank.
33:08
Speaker 14: I don't know if many of them know it, you know,
33:11
Speaker 14: because they go to a bank, a commercial.
33:13
Speaker 15: Bank, but you know, although they are.
33:16
Speaker 14: They have to signal in their loans that this is
33:19
Speaker 14: supported by.
33:20
Speaker 15: The European Investment Bank. I don't know if they always do.
33:22
Speaker 14: But the fact of the matter is the EiV is
33:24
Speaker 14: one of the key elements that he's driving the European economy.
33:27
Speaker 3: Our thanks to Nadia Calvino, President of the European Investment Bank.
33:31
Speaker 4: Staying on climate, we also focus on a Bloomberg big
33:33
Speaker 4: take story this week titled climate change is so bad
33:36
Speaker 4: even the Arctic is on fire. Guest host Damien Sassara
33:40
Speaker 4: and I were joined by one of the reporters on
33:41
Speaker 4: the story, Kyle Kim Bloomberg, data visualization reporter. We first
33:45
Speaker 4: asked Kyle to walk us through the story and what
33:47
Speaker 4: he learned.
33:48
Speaker 17: Climate change, you know, is making wildfire is more common
33:51
Speaker 17: and intense, and that may not be the new part,
33:55
Speaker 17: because that's, you know, been in the news for a while,
33:57
Speaker 17: but it's also causing fires and places that a lot
34:00
Speaker 17: of people normally wouldn't expect, like the Arctic and the
34:03
Speaker 17: wetlands in Brazil and Indonesia. And what's really unique about
34:08
Speaker 17: these fires is that they tend to move underground and
34:11
Speaker 17: smolder below the surface, and it could be for months
34:15
Speaker 17: that this is happening. And these underground fires are basically
34:19
Speaker 17: burning through prehistoric vegetation called peat and just releasing enormous
34:25
Speaker 17: amounts of carbon. And these peak materials they only cover
34:30
Speaker 17: about three to four percent of the Earth's surface, but
34:32
Speaker 17: they hold up to a third of the world's soil carbon.
34:36
Speaker 17: So it means that these fires are having an outsized
34:39
Speaker 17: impact on climate change and causing a lot of negative feedback.
34:43
Speaker 17: We're saying that carbon from the burning peat is causing
34:47
Speaker 17: emissions from the Arctic Circle to skyrocket, and it's accelerating
34:52
Speaker 17: the thawing of permafrost there, which is this always frozen
34:55
Speaker 17: layer in the ground, and when it melts, it releases
34:58
Speaker 17: things like carbon and methane, and it's making the architect
35:02
Speaker 17: even hotter.
35:03
Speaker 4: How do you prevent that? Like I appreciate that we
35:06
Speaker 4: all need to tackle climate change, et cetera, but this specifically,
35:09
Speaker 4: because it's even hard to see, how do you manage it?
35:13
Speaker 17: Yeah, well, even the professionals, you know, it's it's fighting
35:16
Speaker 17: fire in general is a hard task, right, but fighting
35:19
Speaker 17: them underground it's very difficult because it is not visible.
35:24
Speaker 17: So they you know, look for smoke coming from the ground.
35:27
Speaker 17: And for example, in places in Indonesia, firefighters are using
35:33
Speaker 17: fire suppression holes. They're basically injecting water into the ground
35:36
Speaker 17: and it's hard to tell really if it's fully extinguished
35:40
Speaker 17: or not. And it's you know, this is a very
35:43
Speaker 17: understudied and not well understood yet, and so there's still
35:47
Speaker 17: a lot to learn and how to combat these kinds
35:49
Speaker 17: of fires. And for now, you know better monitoring for
35:53
Speaker 17: carbon emissions, but at least help to understand the scope
35:56
Speaker 17: of the problem.
35:57
Speaker 13: Well, Kyle, here's the interesting thing about it. You make
35:59
Speaker 13: a great point. You know, the permafrost cover. I mean,
36:01
Speaker 13: this is a real risk black carbon.
36:02
Speaker 5: We know what the risk is. But isn't a lot
36:04
Speaker 5: of that taking place in Russia? I mean, is Russia
36:06
Speaker 5: even aware of this? And do they even care?
36:08
Speaker 17: Yes, they definitely are aware. You know, scientists project as
36:13
Speaker 17: much as a third of the permafrost in the northern
36:16
Speaker 17: Hemisphere is gonna receive by the end of the century,
36:19
Speaker 17: and a lot of that is in Russia. A lot
36:22
Speaker 17: of the permafrost now that's going to be gone by then,
36:25
Speaker 17: and the climate experts are already identifying the eastern region
36:30
Speaker 17: of Russia has seen the largest growth amongst Arctic wildfires
36:35
Speaker 17: since the early two thousands, So they're aware that it's,
36:38
Speaker 17: you know, going to be more and more of a problem.
36:40
Speaker 12: All right.
36:41
Speaker 3: Thanks to Kyle can Bloomberg Data Visualization Recorder.
36:44
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