With the pushback against ESG (an investment “discipline” under which actual or prospective portfolio companies are measured against various environmental, social, and governance benchmarks) gathering momentum, its proponents have finally had to mount a credible defense of a once seemingly irresistible concept that, up to now, has had no need of one.
That’s not proving easy…
Read MoreApril 3 saw the death of one of the last Thatcherite greats, Nigel Lawson. He was ninety-one. Serving as Margaret Thatcher’s chancellor of the exchequer (finance minister) between 1983 and 1989, Lawson played a vital part in creating a British economic revival so strong that it took the combined efforts of both the Conservative and the Labour parties decades to destroy it…
Read MoreSay what you will about Jamie Dimon, the chairman and CEO of JPMorgan Chase, but when it comes to property rights, he is pretty consistent. He was chairman of the Business Roundtable when, in 2019, in a statement co-signed by a large number of CEOs, it jettisoned its support for shareholder primacy — the idea that the principal purpose of a corporation is to generate return for its shareholders. That was old hat. Now corporations should “deliver value” to all their stakeholders, of which shareholders are only one class.
Read MoreMispricing money comes with consequences. And the longer that money is mispriced the more uncomfortable those consequences will be. We are now seeing what look to be the early stages of a long, painful period of readjustment…
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Those who believe in free markets — or who are familiar with the history of developed economies after they became developed (or, maybe, completed postwar reconstruction) — ought to have little time for industrial policy. Free markets are bottom-up, flexible, and work with their own imperfections. They function through a continuous process of communication that recognizes that the valuable message sent by a price yesterday may be worthless today. Much of their operation is by trial and error. To be sure, there are disasters — plenty of them — but they often point to a better use of capital elsewhere or next time. The prosperity free markets have brought, and the human flourishing they have enabled, is unmatched.
By contrast — and despite some successes — industrial policy has a generally inglorious track record…
Read MoreThe term “special military operation” was not just a euphemism. It also reflected the Kremlin’s hope that it could take Ukraine by means of a swift “decapitation.” Kyiv would be overrun, Ukraine’s leadership would be killed, arrested, or driven into exile, and the country would fall under Russian control. We will never know what was meant to have come next. Two days before the invasion, Russia had recognized the Donetsk and Luhansk “People’s Republics” that, with Moscow’s backing, had broken away from Ukraine in 2014. Those have since been annexed by Russia, along with Ukraine’s Zaporizhzhia and Kherson oblasts (regions), although parts of all these territories are still in Ukrainian hands. Moscow probably always intended that this portion of Ukraine would be transferred to Russia, not least because it constituted a broad land bridge to occupied Crimea…
Read MoreThe year 2022 was not the best of years for ESG (an investment discipline under which portfolio companies are measured against various environmental, social, and governance standards). To take one example, as of January 5, the price of BlackRock’s ESG Screened S&P 500 ETF had declined by around 22 percent over twelve months, underperforming the S&P 500, which fell by around 20 percent. Those are only one year’s results (and they would have been marginally improved by dividends), but it’s still not the greatest of looks for an investment approach often sold (typically with higher fees) as a way of doing well by doing good. Making matters more embarrassing still, stocks in those wicked fossil fuel companies (in which ESG investors tend to be underweight) did well. The S&P 500 Energy sector index rose by around 44 percent over the same period…
Read MoreThe stylus descends on the first LP by a new band. “You’ve never heard anything like this,” says a friend one day in 1972 — half a century ago, good Lord.
Track one, side one: Glasses clink, conversation, a cocktail party. A piano starts up: insistent, repetitive, fast. Drums pound, guitars surge, a singer begins, his voice distinctive, mannered.
A chorus joins in, an enigmatic, vaguely retro chant — “CPL593H.” Later, the command, “Show me.” A sax wails and shrieks, the volume heads towards eleven, and the pace accelerates. Something electronic is going on in the background, and the singer returns to his earlier lament…
Last week, Britain’s newly minted (and now newly departing) prime minister, Liz Truss, replaced Kwasi Kwarteng as chancellor of the Exchequer (finance minister) with Jeremy Hunt, a figure from the soggy Tory Party’s soggy center who was widely seen as “a safe pair of hands.” Hunt’s allies claimed that he would be CEO to Truss’s chairman, and that is how it turned out….
Read MoreWith environmental, social and governance (ESG) investing — a profoundly political “discipline” in which actual or prospective portfolio companies are measured against a varying selection of environmental, social and governance metrics — finally coming under the fire that it deserves, its advocates are rushing to its defense, many of them seemingly outraged that a political agenda has attracted the attention of elected politicians who disagree with it…
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