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Speaker 1: Global business news twenty four hours a day. If Bloomberg

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Speaker 1: dot com, the radio plus mobile app and on your radio,

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Speaker 1: this is a Bloomberg Business Flash and I'm Karen Moscow.

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Speaker 1: US Dock Index futures are higher this morning, with equities

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Speaker 1: on course for their longest a streak of weekly games

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Speaker 1: since November. We checked the markets every fifteen minutes throughout

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Speaker 1: the trading day on Bloomberg smp E Mini futures of

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Speaker 1: four and a half points DOWNI Mini futures of thirty eight,

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Speaker 1: NAVS DOCU many futures up eight and a half. The

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Speaker 1: decks in Germany's down a quarter percent ten, Your treasury

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Speaker 1: up one thirty seconds. The yelled one point eight nine

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Speaker 1: percent yield on the two year point eight four percent.

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Speaker 1: Nim X screw oil up one point seven percent or

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Speaker 1: sixty seven cents to forty dollars eighty seven cents of

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Speaker 1: barrel comes goal down one percent or twelve dollars eighty

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Speaker 1: cents at twelve fifty two thirty announced the Euro at

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Speaker 1: ollar twelve seventy seven, the n one eleven point four four. Tiffany,

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Speaker 1: the luxury jewelry retail they're giving a forecast for earnings

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Speaker 1: this year that trailed and as estimates as the sluggish

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Speaker 1: global economy damp sales, shares have turn lower this morning.

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Speaker 1: They're done about half percent right now after being higher earlier.

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Speaker 1: Adobe Systems is up almost seven percent after it reported

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Speaker 1: profit that top analysts estimates is more customers signed up

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Speaker 1: for its cloud based services. Freeport mcmaran up one point

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Speaker 1: eight percent. Alcoa climbing at least nine ten percent this morning,

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Speaker 1: signaling commodity producers roe rally for a third day. That's

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Speaker 1: a bloomberg business flash. Tom and Mike Caramesco, thank you

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Speaker 1: very much. What we've been talking about the fact that

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Speaker 1: it may snow on the first day of spring, but uh,

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Speaker 1: we are not. We have not been overwhelmed by snow

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Speaker 1: this year. We have actually had a very warm year,

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Speaker 1: the warmest year in many years, well ever in two

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Speaker 1: thousand fifteen, and it looks like two thousand sixteen is

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Speaker 1: on the same track. February, the global temperature just shot up,

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Speaker 1: and that shocked climate scientists. Michael Lewis is head of

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Speaker 1: sustainable finance research at Deutsche I Set Management. His job

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Speaker 1: is to watch all this stuff and figure out how

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Speaker 1: it affects your investments going forward. Michael Um, it's pretty

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Speaker 1: hard to deny that they're going to be a lot

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Speaker 1: of impacts from the warming of the world. Yes, I

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Speaker 1: think what sort of interesting is a lot of things

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Speaker 1: coming together at this time, and one of them is

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Speaker 1: obviously technology. So cost cards in renewable sectors such as

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Speaker 1: wind or soda is coming down to becoming much more

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Speaker 1: competitive with sort of fossil fuels. We always got a

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Speaker 1: lot of regulation in this area when we're talking about

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Speaker 1: the Paris Climate Agreement as well to try and combat

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Speaker 1: these sorts of issues. And finally we've got a massive

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Speaker 1: divestment theme as well, where a lot of foundations universities

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Speaker 1: are coming out of fossil fuels. So all this is

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Speaker 1: wrapped into this sort of climate change agenda and a

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Speaker 1: lot of countries are going to have to sort of

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Speaker 1: face those challenges, and also a number of companies as well.

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Speaker 1: To assess the climate risk that we as investors faced

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Speaker 1: in holding a number of these suffective holdings, Well, let's

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Speaker 1: take a look at some of these. The first and

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Speaker 1: most obvious physical risks. We've heard a lot of talk

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Speaker 1: about rising oceans and stronger storms. This is insurance companies

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Speaker 1: obviously in the cross here's but other companies as well. Yes,

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Speaker 1: that's right, and I think this is one of the

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Speaker 1: things that certainly in the UK and the and the

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Speaker 1: Central Bank here has been sort of looking at the

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Speaker 1: channel of risks and obviously the most obvious ones we

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Speaker 1: see are rising sea levels, and from a corporate or

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Speaker 1: a sovereign point of view, I think there are certain

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Speaker 1: countries which are Japan is a good example of a

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Speaker 1: high areas of population at very low sea levels. Australia

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Speaker 1: and New Zealand could be other countries which are particularly

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Speaker 1: vulnerable from a drought perspective and the reliance of those

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Speaker 1: economies on agriculture. But then they're also the ideas of

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Speaker 1: liability risk as well, so there could be a sense

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Speaker 1: very much like Asbestop in the building materials sect to

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Speaker 1: where there a lot of subsequent compensation claims. This could

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Speaker 1: be something that energy companies and fossil fuel companies made

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Speaker 1: face with the Michael wonderful to talk to you. I

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Speaker 1: want to back up your folks and and make a

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Speaker 1: statement and how appropriate and important the shift is of

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Speaker 1: Michael Lewis. And to remember, folks, this is not did

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Speaker 1: you get a check for the Big Short. Did they

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Speaker 1: send you a check for the movie to Big Short? No?

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Speaker 1: Well no, but Michael Lewis, and this is Michael Lewis.

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Speaker 1: This is Michael Lewis a Deutsche Bank, not the Michael

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Speaker 1: Lewis we talked to on finance. And Michael, you know,

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Speaker 1: to remind people, you did foreign exchange for years and

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Speaker 1: then you build arguably the best commodity platform in the world.

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Speaker 1: And now Folcus Landau on your team, have you overdoing

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Speaker 1: climate change? What rigor of research do you want to

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Speaker 1: bring to this effort. I look at the Paris meetings

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Speaker 1: which I attended, and what took me back was a

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Speaker 1: new adult nous to the debate. What adult nous do

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Speaker 1: you want to bring to the annal Well. I think

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Speaker 1: what we want to do is just to sort of

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Speaker 1: highlight that now we're at quite a critical juncture. I mean,

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Speaker 1: I joined commodities in two thousand and three and there

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Speaker 1: was a very compelling story of China and India and

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Speaker 1: the dollar and underinvestment, and I think there's a very

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Speaker 1: powerful sense now that we are faced with huge challenges

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Speaker 1: in this area. And obviously this is this traded by

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Speaker 1: the importance of Michael Bloomberg as part of this effort

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Speaker 1: to deliver much more clear information to people on the

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Speaker 1: risks that we face. And I think it's the enormous

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Speaker 1: amount of information out there and also the incredible amount

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Speaker 1: of terminology which is very difficult for people to understand.

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Speaker 1: There's a huge barrier entry to for people to really

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Speaker 1: get up to understand it. And I think that's what

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Speaker 1: we might break through and look at this not just

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Speaker 1: a sort of an equity story, but it's a sovereign

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Speaker 1: bond story. It's the greening of the financial system. So

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Speaker 1: this is a massive issue for China and it's g

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Speaker 1: twenty year this year is to really spread this OUs

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Speaker 1: and I think in the in the past, I think

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Speaker 1: that a lot of people have looked at greening and

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Speaker 1: as a bit of a luxury good, which it's a

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Speaker 1: nice thing to have, but it can't we can't really

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Speaker 1: afford it. I think now the issue is that we

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Speaker 1: cannot afford not to have it, and I think this

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Speaker 1: is what we're rolling out here at Deutsche Vanney. You

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Speaker 1: mentioned barriers to enter. Prime Minister Trudeau of Canada just

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Speaker 1: entered the room. What would be your counsel to Prime

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Speaker 1: Minister Trudeau to help Canada adapt and particularly adapt as

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Speaker 1: a resource rich nation. Well, I think this is one

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Speaker 1: of the major challenges because if you're looking at exity

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Speaker 1: market valuations and certainly market capitalization by country, Canada does

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Speaker 1: stand out, and certainly the UK as well as a

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Speaker 1: lot of listed companies. So it is to try and

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Speaker 1: change that sort of moving away from kind of the

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Speaker 1: oil company to the more energy company. So that's sort

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Speaker 1: of the renewable side of things. Um And I think

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Speaker 1: that that may well be something that a lot of

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Speaker 1: governments around the world are trying to sort of transform

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Speaker 1: those sorts of energy systems. Um And I think if

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Speaker 1: you're looking at sort of the League tables and sort

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Speaker 1: of countries around the world, kind of that ranks up

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Speaker 1: elatively well. But it's really China in the US that

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Speaker 1: lead that lead the world in terms of clear clean

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Speaker 1: energy technology and trying to roll it out, particularly China.

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Speaker 1: UM So I think there may well be lessons from

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Speaker 1: other parts of the world that Canada can learn from,

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Speaker 1: but there is a high degree of risk there because

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Speaker 1: of the composition of that economy. Companies have many companies

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Speaker 1: have started to focus on this in their business planning

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Speaker 1: scientists were taken aback by how rapidly the globe warmed

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Speaker 1: in the month of February. Have companies recognized that things

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Speaker 1: are perhaps moving faster than anticipated. I think that probably

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Speaker 1: we're seeing a lot of I would put in terms

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Speaker 1: of the curve of who's who's advancing on this kind,

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Speaker 1: I mean social media and the asset owners, that these

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Speaker 1: people are very much aware of the changes. We're also

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Speaker 1: seeing sort of banks responding. My sense would be that

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Speaker 1: corporates are probably a little bit behind these other players

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Speaker 1: within the market, and I think it's it's up to

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Speaker 1: us in research and other players to sort of informed

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Speaker 1: that that entire community. But so far, really the leading

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Speaker 1: sort of areas from from an investment from the point

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Speaker 1: of view, has become has come from the asset owners,

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Speaker 1: so whether it's the sort of the pension funds or

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Speaker 1: the Dutchess, very common within that Scandinavian region and exclude

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Speaker 1: a lot of companies from their portfolios which have very

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Speaker 1: high shares of power production that's coming from coal and

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Speaker 1: other sort of dirty fossil fuels and trying to rebalance

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Speaker 1: that and have a much much more powerful strategy of

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Speaker 1: bringing in renewable energy into those sort of sorts of

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Speaker 1: investment portfolios. And we also see it obviously in the

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Speaker 1: US as well, such as calsters. So this thing is

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Speaker 1: really gathering momentum from the investor community and the asset owners,

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Speaker 1: and I think corporates will are coming up to speed

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Speaker 1: with this process that this isn't that this is something

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Speaker 1: that they need to address. How how quickly is this

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Speaker 1: going to become the issue? Do you think? Um? You know,

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Speaker 1: for the for the planet, it's obviously the issue, but

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Speaker 1: it doesn't rank front and center with most investors or

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Speaker 1: ordinary people yet. No. I mean, I think that the

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Speaker 1: change really is paris So if you look at Kyota,

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Speaker 1: which was the last climate agreement that covered not many

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Speaker 1: countries and only covered about elect and percent of global emissions.

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Speaker 1: Now you had a deal at the end of last

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Speaker 1: year which covered a hundred ninety six countries, which was

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Speaker 1: equivalent to sort of ninety over nine of global emission.

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Speaker 1: So you can see that event I think has been

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Speaker 1: the real trigger that the problem now is obviously Europe

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Speaker 1: and a lot of governments over this side of the

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Speaker 1: world are wrapped up with a huge other sort of

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Speaker 1: political crisis, such as the refugee crisis, and that is

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Speaker 1: is a potential here that that could sort of delay

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Speaker 1: that momentum. I don't think it will, but there are

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Speaker 1: a lot of things on the plate here. But I

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Speaker 1: think that that agreement in Paris really was an enormous

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Speaker 1: tipping point, and it's been followed by a huge amount

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Speaker 1: of other tipping points, and we just look at the

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Speaker 1: divestment programs. These are all accelerating. So it is coming

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Speaker 1: quite fast, and I think by the end of this

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Speaker 1: year you'll have much more information from companies disclosing information

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Speaker 1: on this. That mandatory laws now in France that I

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Speaker 1: will forcing um us it manages to reveal the carbon

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Speaker 1: print of their portfolio. So I think this this is

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Speaker 1: quite a this from Paris. I think things are going

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Speaker 1: to accelerate very rapidly. We need to continue this conversation.

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Speaker 1: Michael Lewis is with Deutsche Bank working in sustainable research.

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Speaker 1: Michael Lewis uh commodities in climate change. He's currently had

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Speaker 1: a sustainable finance research at Deutsche Bank Asset and Wealth Management.

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Speaker 1: That was sure if we might point out, as Mr

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Speaker 1: Lewis mentions, Michael Blomberg, he is the majority owner of

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Speaker 1: Bloomberg LP and of this radio station as well, and

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Speaker 1: was a big part of the Paris meetings of Mayor

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Speaker 1: and all ago with the mayors of this global world.

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Speaker 1: This after what did Snow Snow and march coming up

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Speaker 1: Mike Snow of some type, another hour of Bloomberg's surveillance