Carbon Economy

1

China PMIs tank into recession

China is slowing fast. It’s some combination of lockdowns and structural reform. The manufacturing PMI just expanded: But new orders contracted at home and abroad: The services PMI cratered on lockdowns: Again, new orders were hammered: Construction was still booming at 60 but new orders were flat for a second month. The steel PMI is

22

China’s old economy is headed for a hard landing

Even by China’s capital misallocation standards, this one is a doozy. In April, Evergrande’s EV division was worth $120bn. Today it is worth $10bn: Everything Evergrande is being annihilated as it moves to sell (that is, liquidate) assets to meet the Three Red Lines policy. This is going to weigh on property starts as a

10

Grattan: Reduce industrial emissions now to reach net zero in 2050

The Grattan Institute has released a new report calling on Australian governments to act now to curb industrial emissions if they want to achieve net zero by 2050. Below is the Overview combined with key graphics: Governments around the world are moving to ‘net zero’, to limit the impacts of climate change. All Australian state

4

Evergande plunges towards endgame

Sinocism with the note: The PBoC an CBIRC sent a huge signal today by calling in Evergrande executives for a chat and then issuing a statement on the meeting. 人民银行、银保监会约谈恒大集团 On August 19, 2021, responsible comrades of relevant departments of the People’s Bank of China and China Banking and Insurance Regulatory Commission interviewed senior executives

2

Chinese authorities double down on deflation

Markets are slowly coming around to the MB view that no rescue is imminent in China. There are no signals for it. On the contrary: At Tuesday’s meeting of the Communist Party’s Central Committee for Financial and Economic Affairs, the government detailed new strategies to target the upper echelons. Officials vowed to “strengthen the regulation

118

IPCC: Climate doom at hand

From the IPCC: A. The Current State of the Climate A.1 It is unequivocal that human influence has warmed the atmosphere, ocean and land. Widespread and rapid changes in the atmosphere, ocean, cryosphere and biosphere have occurred. A.2 The scale of recent changes across the climate system as a whole and the present state of

2

War in Taiwan not coming…yet

TS Lombard with the note. I agree with this. But the risks rise as the Chinese economy goes ex-growth and CCP legitimacy slides: China’s growing military assertiveness towards Taiwan over the past 18 months has deepened concerns that it is preparing to invade. But the increasingly vocal minority who argue that rising tensions along the

6

Evergrande pulls special dividend

This was always one serious Hail Mary: As China Evergrande Group mulls a special dividend to revive confidence in its tumbling stock, analysts are gaming out several scenarios that could have markedly different implications for equity and bond investors. Chairman Hui Ka Yan, who directly or indirectly controls three-quarters of outstanding Evergrande shares, will meet

1

Chinese developer trouble deepens

Ever since China installed its “three red lines” policy early this year, there have been increasing signs of stress in China’s mega-development sector. Floor area starts have dropped sharply, equity markets have punished the sector and credit markets begun to tighten the noose on the more freewheeling names. That process continues today as Chin’s greatest

25

Biden puts heat on Morrison climate lies

Our Gaslighter-in-Chief is having his climate bluff called. After yesterday promising an absurdly low $500m in new carbon taxes, the Biden administration is having none of it: The Biden administration has demanded deeper carbon cuts from Australia. “Technology not taxes” is insufficient said a senior official. The US is expected to announce roughly double Australia

45

PMs and generals unite against Morrison climate fail

It is a full-court press against the climate spoiler Morrison Government today. Leading us off are former PMS Malcolm Turnbull and Kevin Rudd united in anger. They say: The Biden administration has dramatically reset the climate agenda. US, Japan, Korea and Canada will announce new and deeper 2030 targets. Australia is doing nothing. Its targets

70

Climate Council alarm grows

Another day, another alarming scientific climate change report from a very authoritative source, The Climate Council: Climate change is accelerating with deadly consequences. The ecological systems that have sustained human life and societies for generations are being severely damaged by increasing heat and worsening extreme weather events. › There is no safe level of global

30

Labor to roll out community batteries

Readers will know that the MB view of the uptake of battery power to supplant traditional baseload output reliant on fossil fuels is inevitable.  Now, Labor has seen the light with an actual policy from Albo today: Labor will spend $200m on community batteries. Each is about the size of a four-wheel drive. They will be

6

Ten principles for green power investment

Via Wood Mackenzie: We recommend the following action items for capital allocators: • With roughly US$800 billion in annual spend, it’s a growth story. Apply strict discipline when it comes to risk-return expectations. Be conservative on the terminal value assumptions. • Don’t ignore opportunities in the T&D sector. Returns could be better in T&D versus

61

The Coalition is a total energy imbecile

The Coalition is a total energy imbecile. And I am being kind. It’s a damn miracle that Australia’s decarbonisation of the grid is going so swimmingly because the Morrison Government and its Coalition predecessors are completely lost.  After yesterday’s excellent news that Yallourn coal-fired power station is going to close in 2028, with seven whole

31

Why China’s great technology plunge will smash Australia

Ever since Xi Jinping came to power in China, its economic narrative has shifted. What was considered an endless miracle of growth before his rise, transformed afterward into an endless critique of unbalanced growth. Xi launched major reforms from 2012 to 2015 that aimed for structural transformation in the Chinese economy from investment to consumption.

107

Should we get nuclear power?

The latest distraction thrown up by the struggling Morrison Government is a push for nuclear power. The Nats began it last week. Today we see more Coalition flunkies joining the push. The AFR has trolled the internet to find somebody else that supports the notion in Poland. At The Australian it’s Menzies Insitute doyen Nick

44

Can farming be excluded and still reach 2050 net zero?

The Morrison Government’s absurd position on climate change is slowly evolving. Gone are the denials about climate change replaced by a motley crew of rent-seekers. We’ve shifted from the coal fixation to a “gas-led recovery” which is twenty years too late and won’t work anyway given the gas supply cartel on the east coast. Now

16

Capital installs mega-battery on ScoMo’s coal plant

Via Bloomie: Australia is planning another giant grid-scale battery as the global roll out of super-sized energy storage projects accelerates. The project in New South Wales-state, which will be three times larger than the current No. 1 battery in California, aims to store energy for the grid as Australia raises its share of renewable power.

4

ScoMo’s secret carbon tax kills gas power

Via Platts: The decline in gas-fired power generation to a 15-year low in eastern Australia’s national electricity market (NEM) in October-December may reflect the transition of country’s largest source of greenhouse gas (GHG) emissions to a lower carbon intensive sector. But it was not what the Australian government had in mind when it unveiled its

24

Australia last on zero-emissions scoreboard

Via the Bloomberg G20 Zero-carbon policy scoreboard: Governments around the world are considering how best to drive companies and consumers to reduce greenhouse-gas emissions with a view to avoiding catastrophic climate change. Many have begun to implement policies to achieve their goals, including setting a growing number of ‘net-zero’ targets. But which policies have been