1 00:00:02,360 --> 00:00:04,760 Speaker 1: Good morning. It's Monday, the fourth of December here in London. 2 00:00:04,800 --> 00:00:08,039 Speaker 1: This is the BlueBag Daybreak Here podcast. I'm Caroline Hepka and. 3 00:00:08,000 --> 00:00:11,479 Speaker 2: I'm Stephen Carroll. Coming up today, Iranian backed Hoothy Rebels 4 00:00:11,560 --> 00:00:15,040 Speaker 2: attack commercial ships in the Red Sea as Israel ramps 5 00:00:15,120 --> 00:00:16,560 Speaker 2: up its offensive in Gaza. 6 00:00:16,960 --> 00:00:21,200 Speaker 1: Bill Gates warns the world probably won't meet its climate goals, 7 00:00:21,239 --> 00:00:26,400 Speaker 1: as Bloomberg finds Banks green reporting lacks consistency. 8 00:00:25,800 --> 00:00:30,840 Speaker 2: Plus eight three hundred pounds worse off. Britain's economic stagnation 9 00:00:31,000 --> 00:00:34,600 Speaker 2: leaves households counting the cast, according to one new report. 10 00:00:34,920 --> 00:00:38,320 Speaker 1: Let's start with a roundup of our top stories. A 11 00:00:38,479 --> 00:00:41,320 Speaker 1: US Navy ship has responded to a florri of drone 12 00:00:41,320 --> 00:00:45,320 Speaker 1: and missile attacks against commercial ships operating in the Red Sea. 13 00:00:45,760 --> 00:00:50,000 Speaker 1: The destroyer USS Carney blamed Yemen's Hoothy Rebels for what 14 00:00:50,120 --> 00:00:54,120 Speaker 1: it said were four attacks against three separate vessels. Those 15 00:00:54,120 --> 00:00:57,160 Speaker 1: included an attack on the UK owned cargo ship, the 16 00:00:57,280 --> 00:01:01,800 Speaker 1: Unity Explorer, which caused minor damage which Retired US Marine 17 00:01:01,840 --> 00:01:06,000 Speaker 1: Colonel Steve Ganyard says that the Pentagon fears escalation. 18 00:01:06,959 --> 00:01:09,039 Speaker 3: The use is being very careful not to turn the 19 00:01:09,080 --> 00:01:12,360 Speaker 3: Red Sea into a shooting gallery who these continue to 20 00:01:12,400 --> 00:01:14,920 Speaker 3: target what they say are only Israeli ships, But the 21 00:01:15,040 --> 00:01:17,080 Speaker 3: US needs to be assured and the world needs to 22 00:01:17,120 --> 00:01:19,800 Speaker 3: be assured that there's freedom of navigation and that ships 23 00:01:19,800 --> 00:01:23,080 Speaker 3: could print it the heavily trafficked Red Sea. 24 00:01:23,720 --> 00:01:27,040 Speaker 1: Steve Ganyard, reflecting on the growing fears for the safety 25 00:01:27,040 --> 00:01:30,160 Speaker 1: of vessels in the busy shipping lane. Last month, the 26 00:01:30,240 --> 00:01:33,160 Speaker 1: rebels in Yemen issued a threat against ships with ties 27 00:01:33,200 --> 00:01:37,039 Speaker 1: to Israel in the area, calling them quote legitimate targets. 28 00:01:37,560 --> 00:01:41,280 Speaker 2: The regional escalation comes as Israel's military expands its operations 29 00:01:41,319 --> 00:01:44,360 Speaker 2: against Hamas. Days after a week long truce came to 30 00:01:44,400 --> 00:01:47,640 Speaker 2: an abrupt end. The Israeli military is now warning many 31 00:01:47,680 --> 00:01:51,360 Speaker 2: of the territory's two point two million residents to evacuate 32 00:01:51,400 --> 00:01:54,560 Speaker 2: parts of southern Gaza as it ramps up airstrikes on 33 00:01:54,600 --> 00:01:58,920 Speaker 2: the territory. He bit TV from the aid organization Care International. 34 00:02:00,120 --> 00:02:03,720 Speaker 4: The winter is already in Gaza. People left without proper clothing. 35 00:02:03,920 --> 00:02:07,360 Speaker 4: Most of them they already sleep outdoor in the overcrowded churches, 36 00:02:07,560 --> 00:02:10,240 Speaker 4: and now with this new evacuation, many of them say, 37 00:02:10,440 --> 00:02:13,200 Speaker 4: we know we need to evacuate, but we don't know 38 00:02:13,280 --> 00:02:15,480 Speaker 4: where to go with a new order. 39 00:02:16,320 --> 00:02:19,080 Speaker 2: That warning from one AID agency comes as John Kirby, 40 00:02:19,160 --> 00:02:22,680 Speaker 2: spokesman for the US National Security Council, said Israel had 41 00:02:22,720 --> 00:02:25,480 Speaker 2: taken steps to minimize civilian casualties. 42 00:02:27,480 --> 00:02:30,040 Speaker 5: We've urged them to as they go south, We've said, 43 00:02:30,120 --> 00:02:32,400 Speaker 5: we've said publicly, we don't want to see them move 44 00:02:32,440 --> 00:02:34,880 Speaker 5: into the south unlesser until they have accounted for that 45 00:02:35,000 --> 00:02:38,200 Speaker 5: additional now civilian population, because they move folks out of 46 00:02:38,200 --> 00:02:40,320 Speaker 5: the north and the South, hundreds of thousands of them, 47 00:02:40,440 --> 00:02:42,280 Speaker 5: we want to make sure that they're properly accounted for. 48 00:02:42,320 --> 00:02:45,800 Speaker 5: And again them publishing this map online and dropping leaflets 49 00:02:45,800 --> 00:02:48,359 Speaker 5: and informing people of where not to go. I mean 50 00:02:48,360 --> 00:02:49,760 Speaker 5: that is a step in the right direction. 51 00:02:50,720 --> 00:02:53,600 Speaker 2: That's John Kirby speaking the hamaser On Health Ministry in Gaza, 52 00:02:53,639 --> 00:02:56,440 Speaker 2: says more than fifteen thoy five hundred people have been 53 00:02:56,520 --> 00:03:00,480 Speaker 2: killed since the conflict began eight weeks ago. Israel around 54 00:03:00,480 --> 00:03:03,600 Speaker 2: four hundred of its soldiers and fifty nine police personnel 55 00:03:03,600 --> 00:03:07,600 Speaker 2: have been killed since the deadly seventh of October attack. 56 00:03:08,280 --> 00:03:11,560 Speaker 1: And now two stays around climate change, Bill Gates sees 57 00:03:11,600 --> 00:03:15,959 Speaker 1: a hotter world, failing to stop temperatures from rising even higher. 58 00:03:16,280 --> 00:03:19,320 Speaker 1: Once the world's richest man, Gates has devoted large sums 59 00:03:19,320 --> 00:03:22,639 Speaker 1: of money to fighting climate change. At this year's cop summit, 60 00:03:22,760 --> 00:03:26,760 Speaker 1: he told Bloomberg humanity will miss global warming targets that 61 00:03:26,800 --> 00:03:30,160 Speaker 1: were set at the twenty fifteen Paris Agreement. 62 00:03:31,080 --> 00:03:35,520 Speaker 6: No, we won't hit the aspirational targets. Well, you can 63 00:03:35,560 --> 00:03:38,080 Speaker 6: do the mouth on one point five. 64 00:03:39,360 --> 00:03:43,240 Speaker 7: And even two point zero. Isn't that likely. 65 00:03:44,560 --> 00:03:47,760 Speaker 1: Gates is still optimistic that the world can avoid becoming 66 00:03:47,800 --> 00:03:51,760 Speaker 1: three degrees celsius warmer than the pre industrial era, but 67 00:03:51,840 --> 00:03:54,960 Speaker 1: scientists point to this is extreme weather as an omen 68 00:03:55,040 --> 00:03:57,280 Speaker 1: of the damage that climate change is causing. 69 00:03:58,000 --> 00:04:00,320 Speaker 2: Bitcoin has hed a nineteen month high of more than 70 00:04:00,360 --> 00:04:04,880 Speaker 2: forty one thousand dollars. The cryptocurrency's stellar performance comes after 71 00:04:04,920 --> 00:04:07,160 Speaker 2: a turbulent period for the token in the wake of 72 00:04:07,280 --> 00:04:11,480 Speaker 2: ftx as collapse. Lucy Gasmararian is the managing partner and 73 00:04:11,560 --> 00:04:15,200 Speaker 2: founder at Token Bay Capital. She explains why she sees 74 00:04:15,240 --> 00:04:16,160 Speaker 2: bitcoin surging. 75 00:04:16,600 --> 00:04:19,039 Speaker 8: You know, there's a combination of factors going on here. 76 00:04:19,320 --> 00:04:22,920 Speaker 8: I'd say, you know, expectations that interest rates are potentially 77 00:04:22,960 --> 00:04:26,440 Speaker 8: going to you know, start coming down next year, and 78 00:04:26,480 --> 00:04:28,719 Speaker 8: then the big thing in the sort of crypto circles 79 00:04:28,960 --> 00:04:31,560 Speaker 8: is that the bitcoin harving that's coming up, where the 80 00:04:31,600 --> 00:04:35,960 Speaker 8: rewards for miners that are mining bitcoin transactions gets cut 81 00:04:36,000 --> 00:04:37,880 Speaker 8: in half so you get a supply shot. 82 00:04:38,960 --> 00:04:41,720 Speaker 2: Lucy Gasmararian speaking there, Bitcoin is jumped by more than 83 00:04:41,720 --> 00:04:44,839 Speaker 2: one hundred and fifty percent this year to outstrip other 84 00:04:44,880 --> 00:04:46,760 Speaker 2: investments like stocks and gold. 85 00:04:47,760 --> 00:04:51,680 Speaker 1: UK households are now roughly eight thousand pounds poorer than 86 00:04:51,720 --> 00:04:54,919 Speaker 1: those in France and Germany, according to a major new report. 87 00:04:55,360 --> 00:04:58,080 Speaker 1: Two think tanks behind it so that Britain is in 88 00:04:58,279 --> 00:05:01,560 Speaker 1: fifteen years of stagnation and has called the government's economic 89 00:05:01,640 --> 00:05:05,680 Speaker 1: plan quote not serious. Bloomberg's James Worcock has the story. 90 00:05:06,279 --> 00:05:09,719 Speaker 9: The Resolution Foundation and the Center for Economic Performance say 91 00:05:09,720 --> 00:05:13,320 Speaker 9: the UK might have had its own lost decade of growth. 92 00:05:13,839 --> 00:05:16,440 Speaker 9: The two top think tanks say Britain's earn less and 93 00:05:16,480 --> 00:05:20,080 Speaker 9: are now less productive than rival countries, but despite their 94 00:05:20,160 --> 00:05:23,080 Speaker 9: major new report calling for more investment and funding for 95 00:05:23,120 --> 00:05:27,640 Speaker 9: public services, taxes are at a postwar high. Labour leader 96 00:05:27,720 --> 00:05:30,640 Speaker 9: Kissed Armer praised Margaret Thatcher over the weekend and says 97 00:05:30,640 --> 00:05:34,479 Speaker 9: his party won't turn on spending taps if elected in London. 98 00:05:34,640 --> 00:05:36,560 Speaker 9: James Wilcock, Bloomberg Radio. 99 00:05:37,520 --> 00:05:40,240 Speaker 2: And the Chinese developer Evergrant has won a reprieve in 100 00:05:40,279 --> 00:05:43,840 Speaker 2: a restructuring agreement with creditors. Bloomberg's Brian Curtis has more 101 00:05:43,880 --> 00:05:44,600 Speaker 2: from Hong Kong. 102 00:05:45,120 --> 00:05:48,200 Speaker 10: This buys some time Forevergrand and its creditors to do 103 00:05:48,279 --> 00:05:50,880 Speaker 10: a deal. Hong Kong Court has earned a winding up 104 00:05:50,920 --> 00:05:55,080 Speaker 10: proceeding until January twenty ninth. The unexpected delay came as 105 00:05:55,080 --> 00:05:58,400 Speaker 10: the original petitioner did not push for an immediate liquidation. 106 00:05:58,960 --> 00:06:01,720 Speaker 10: Bloomberg has report or did that offshore creditors want a 107 00:06:01,760 --> 00:06:05,200 Speaker 10: controlling interest in Evergrand and its two Hong Kong units. 108 00:06:05,520 --> 00:06:08,880 Speaker 10: The builder has offered them a minority stake. Expect a 109 00:06:08,920 --> 00:06:11,120 Speaker 10: lot of back and forth now over the next eight 110 00:06:11,160 --> 00:06:13,919 Speaker 10: weeks in Hong Kong. Brian Curtis, Bloomberg Radio. 111 00:06:14,800 --> 00:06:17,279 Speaker 2: Now in a moment, we'll be discussing fears of greenwashing 112 00:06:17,320 --> 00:06:20,360 Speaker 2: and sustainable investment goals for banks. But the story that 113 00:06:20,400 --> 00:06:23,719 Speaker 2: caught Maya this morning from COP twenty eight. Obviously, we've 114 00:06:23,720 --> 00:06:26,440 Speaker 2: been talking about a lot of the big conversations happening there, 115 00:06:26,480 --> 00:06:29,600 Speaker 2: the global agreements to try and tackle renewables, But an 116 00:06:29,600 --> 00:06:32,560 Speaker 2: idea from a Russian billionaire to look at how the 117 00:06:32,720 --> 00:06:38,360 Speaker 2: tundra ecosystem in Siberia could be maintained to stop the 118 00:06:38,480 --> 00:06:43,720 Speaker 2: release of methane emissions from the thawing permafrost there as well. 119 00:06:43,880 --> 00:06:47,560 Speaker 2: His idea is to recreate a time when Woolly Mammetz 120 00:06:47,880 --> 00:06:51,600 Speaker 2: wrote roam to the tundra. This is something that we're 121 00:06:51,839 --> 00:06:54,600 Speaker 2: trying to see. He's demonstrating with the sort of digital 122 00:06:55,400 --> 00:06:57,760 Speaker 2: illustration of what it would look like if I sage 123 00:06:57,800 --> 00:07:04,919 Speaker 2: animals were wandering the tundra in Siberia. But that's yes. 124 00:07:05,600 --> 00:07:09,520 Speaker 1: Is that serious or is this the sort of because look, 125 00:07:09,920 --> 00:07:12,560 Speaker 1: coming with COP twenty eight, all sorts of ideas and 126 00:07:13,440 --> 00:07:16,360 Speaker 1: a bit of a kind of trade show. Feel basically 127 00:07:16,400 --> 00:07:18,120 Speaker 1: on the side of COP twenty eight, a lot of 128 00:07:18,120 --> 00:07:22,120 Speaker 1: businesses come to kind of talk about all of the 129 00:07:22,160 --> 00:07:24,680 Speaker 1: climate change issues. I mean, I suppose there's a there's 130 00:07:24,680 --> 00:07:26,440 Speaker 1: been a lot of criticism that is being held in 131 00:07:26,440 --> 00:07:30,400 Speaker 1: a petro state effectively, and so one wonder is that 132 00:07:30,520 --> 00:07:31,760 Speaker 1: is that a serious proposition? 133 00:07:31,880 --> 00:07:32,080 Speaker 11: Yeah? 134 00:07:32,080 --> 00:07:34,200 Speaker 2: I mean, look, you're not alone and thinking that. Robert Savans, 135 00:07:34,240 --> 00:07:38,080 Speaker 2: is a Harvard University professor of environmental economics, says you 136 00:07:38,120 --> 00:07:40,520 Speaker 2: could think of this as more of a circus where 137 00:07:40,520 --> 00:07:43,400 Speaker 2: the main event is sometimes eclipsed by the prominence of 138 00:07:43,560 --> 00:07:47,440 Speaker 2: trade shows as well. It is something it's I think 139 00:07:47,440 --> 00:07:49,280 Speaker 2: it's not quite mammots that we're looking at as well, 140 00:07:49,320 --> 00:07:51,120 Speaker 2: but it is the idea of trying to restore what 141 00:07:51,160 --> 00:07:54,200 Speaker 2: the ecosystem was at the time of the mammoths, to 142 00:07:54,240 --> 00:07:57,560 Speaker 2: be able to try and contain and stop essentially the 143 00:07:57,560 --> 00:07:59,920 Speaker 2: permafrast melting at the rate that it is because of 144 00:08:00,080 --> 00:08:02,400 Speaker 2: the risk of releasing more methane, which is actually more 145 00:08:02,440 --> 00:08:04,800 Speaker 2: damaging to the climate than other greenhouse gas missions. 146 00:08:04,840 --> 00:08:07,840 Speaker 1: Yea, absolutely, but the major challenge that you're trying to 147 00:08:07,840 --> 00:08:11,400 Speaker 1: deal with climate change and what that means. Continued coverage 148 00:08:11,440 --> 00:08:14,400 Speaker 1: then on the program this morning of the COP twenty 149 00:08:14,400 --> 00:08:16,720 Speaker 1: eighth summit, which obviously is on for a whole fortnite. 150 00:08:17,200 --> 00:08:20,520 Speaker 2: Let's go next though, to the Middle East, where Israel's 151 00:08:20,560 --> 00:08:23,880 Speaker 2: military is expanding operations across Gaza, while a US Navy 152 00:08:23,880 --> 00:08:26,960 Speaker 2: ship has responded to drone and missile attacks against commercial 153 00:08:26,960 --> 00:08:29,600 Speaker 2: ships in the Red Sea. We've got Bloomberg senior reporter 154 00:08:29,680 --> 00:08:32,600 Speaker 2: Anthony's cuisine with us in Tel Aviv this morning. Anthony, 155 00:08:32,679 --> 00:08:36,280 Speaker 2: let's start with what's been happening in Gaza. The Israeli 156 00:08:36,280 --> 00:08:39,360 Speaker 2: military offensive targeting the south of Gaza. What more can 157 00:08:39,400 --> 00:08:39,880 Speaker 2: you tell us? 158 00:08:41,400 --> 00:08:45,000 Speaker 11: Okay, Well, obviously it's a pretty intense campaign. We just 159 00:08:45,040 --> 00:08:48,960 Speaker 11: had news that the IDF says it hit about two 160 00:08:49,040 --> 00:08:53,760 Speaker 11: hundred targets overnight, So a lot of air strikes and 161 00:08:53,920 --> 00:08:59,000 Speaker 11: other ordinance, all in a very crowded area where most 162 00:08:59,040 --> 00:09:01,800 Speaker 11: of Gaza two point two million people are now hold up. 163 00:09:02,960 --> 00:09:06,880 Speaker 11: It's a very difficult situation because Israel has come under 164 00:09:06,920 --> 00:09:11,760 Speaker 11: intense criticism for the number of civilian casualties in its 165 00:09:11,840 --> 00:09:14,920 Speaker 11: campaign in northern Gaza in recent weeks before the Truth 166 00:09:15,760 --> 00:09:18,600 Speaker 11: and now it's proceeding into southern Gaza. And while it 167 00:09:18,640 --> 00:09:22,480 Speaker 11: has set up a safe zone and has been putting 168 00:09:22,480 --> 00:09:24,960 Speaker 11: a map online and dropping leaflets to tell people where 169 00:09:25,000 --> 00:09:29,959 Speaker 11: to go, AID agencies and Gazans themselves are saying they 170 00:09:29,960 --> 00:09:32,160 Speaker 11: don't know what's going on and where to go, and 171 00:09:32,200 --> 00:09:34,200 Speaker 11: they feel they've got nowhere left to go. 172 00:09:35,600 --> 00:09:38,560 Speaker 1: So how what is the response then, when the likes 173 00:09:38,559 --> 00:09:41,600 Speaker 1: of the US Vice President Kamala Harris are warning Israel 174 00:09:41,720 --> 00:09:46,120 Speaker 1: about civilian casualties in Gaza? How significant is it? A 175 00:09:46,240 --> 00:09:48,440 Speaker 1: change in tone from the Biden administration. 176 00:09:49,559 --> 00:09:55,439 Speaker 11: Absolutely, the Biden administration officials have become more strident over 177 00:09:55,440 --> 00:09:59,559 Speaker 11: the last few weeks in cautioning Israel to be exercisemare 178 00:09:59,600 --> 00:10:02,280 Speaker 11: caution to try and limit the number of civilian casualties. 179 00:10:03,240 --> 00:10:04,200 Speaker 7: They're coming under a lot of. 180 00:10:04,160 --> 00:10:07,640 Speaker 11: Pressure at home and also from the international community about 181 00:10:08,120 --> 00:10:11,240 Speaker 11: the death toll, which local authorities in Gaza put at 182 00:10:11,240 --> 00:10:14,319 Speaker 11: more than fifteen thousand, five hundred, many of those children. 183 00:10:16,559 --> 00:10:18,720 Speaker 11: But at the same time, the US has said it 184 00:10:18,720 --> 00:10:23,120 Speaker 11: supports Israel's broad aims in the war of destroying Hamas 185 00:10:23,280 --> 00:10:27,199 Speaker 11: and retrieving its hostages, which still stand at one hundred 186 00:10:27,200 --> 00:10:27,839 Speaker 11: and thirty seven. 187 00:10:28,880 --> 00:10:31,640 Speaker 2: And you we're also monitoring events in the Red Sea too, 188 00:10:31,720 --> 00:10:35,800 Speaker 2: after we had that firing by US Navy ship intervening 189 00:10:36,160 --> 00:10:40,440 Speaker 2: because of fire from Hooty rebels and Yemen. How series 190 00:10:40,559 --> 00:10:42,640 Speaker 2: is an escalation of the events that we've seen in 191 00:10:42,679 --> 00:10:43,200 Speaker 2: the Red Sea. 192 00:10:44,280 --> 00:10:48,720 Speaker 11: Well, certainly yesterday was the most most intense activity we've 193 00:10:48,760 --> 00:10:51,880 Speaker 11: seen since the conflict began in October seven. The hoofi's 194 00:10:51,920 --> 00:10:54,480 Speaker 11: head said that they would target Israeli in ships, and 195 00:10:54,520 --> 00:10:56,640 Speaker 11: there've been a couple of instances so far, but yesterday 196 00:10:56,640 --> 00:10:58,360 Speaker 11: there was a lot of activity, with three or four 197 00:10:58,440 --> 00:11:03,120 Speaker 11: vessels targeted. None of them were badly damaged. But the 198 00:11:03,440 --> 00:11:06,280 Speaker 11: US naval did have to fire on drawings and perhaps missiles, 199 00:11:06,920 --> 00:11:08,640 Speaker 11: and definitely it's an escalation of. 200 00:11:08,640 --> 00:11:12,920 Speaker 1: Sorts, okay. And so in terms of what it means 201 00:11:13,320 --> 00:11:15,600 Speaker 1: in a widening of the conflict in the Middle East, 202 00:11:16,640 --> 00:11:20,920 Speaker 1: how much concern is there around that, I don't think. 203 00:11:21,400 --> 00:11:23,000 Speaker 11: I don't think we should overplay it. I don't think 204 00:11:23,040 --> 00:11:24,840 Speaker 11: it means that there as you know, there's going to 205 00:11:24,840 --> 00:11:26,920 Speaker 11: be new players dread into this conflict. But what it 206 00:11:26,960 --> 00:11:29,800 Speaker 11: does mean is that one of the world's most important 207 00:11:30,720 --> 00:11:37,360 Speaker 11: passageways for ship traffic is increasingly perilous, and that threatens 208 00:11:37,320 --> 00:11:39,160 Speaker 11: the world trade and the global economy. 209 00:11:39,240 --> 00:11:40,800 Speaker 10: So it's it's a pretty big deal. 210 00:11:42,240 --> 00:11:44,320 Speaker 2: Okay, Anthony, thank you very much for bringing u up 211 00:11:44,360 --> 00:11:46,480 Speaker 2: today with the latest developments there. That's our senior reporters 212 00:11:46,559 --> 00:11:49,000 Speaker 2: Anthony's cuisine joining us from Tel Aviv this morning. 213 00:11:49,840 --> 00:11:52,280 Speaker 1: Now let's go back to the story around COP twenty 214 00:11:52,280 --> 00:11:55,080 Speaker 1: eight in the Climate talks. Is the world's biggest banks 215 00:11:55,120 --> 00:11:58,760 Speaker 1: are heading to Dubai for what is Climate Day today? 216 00:11:59,200 --> 00:12:02,760 Speaker 1: Industry Insight does there are raising questions about the sustainable 217 00:12:02,840 --> 00:12:06,240 Speaker 1: finance achievements that banks have made amid concerns that they 218 00:12:06,280 --> 00:12:09,600 Speaker 1: are overstating their impact. Joining us for more on this 219 00:12:09,720 --> 00:12:11,960 Speaker 1: is our markets reporter Greg Ritchie. I good to have 220 00:12:12,040 --> 00:12:14,360 Speaker 1: you back on radio. What is it that banks are 221 00:12:14,400 --> 00:12:16,600 Speaker 1: doing that is now facing so much scrutiny? 222 00:12:17,120 --> 00:12:17,840 Speaker 12: Thanks for having me. 223 00:12:18,080 --> 00:12:18,200 Speaker 1: So. 224 00:12:18,640 --> 00:12:21,000 Speaker 12: The background of this is that all pretty much every 225 00:12:21,000 --> 00:12:24,600 Speaker 12: single major global bank has set as sustainable finance targets. 226 00:12:24,679 --> 00:12:27,040 Speaker 12: So that's why they commit to say we're raising one 227 00:12:27,080 --> 00:12:30,840 Speaker 12: trillion dollars of sustainable finance by twenty thirty, and they 228 00:12:30,840 --> 00:12:33,760 Speaker 12: often publicize that by saying this year we raise two 229 00:12:33,840 --> 00:12:37,199 Speaker 12: hundred and fifty billion dollars towards our targets. The issue 230 00:12:37,240 --> 00:12:40,520 Speaker 12: is that nobody has really defined sustainable finance in a 231 00:12:40,559 --> 00:12:43,560 Speaker 12: coherent way that is the same across all banks. So 232 00:12:43,679 --> 00:12:47,160 Speaker 12: some banks count deals that other banks wouldn't sustainable finance. 233 00:12:47,640 --> 00:12:50,800 Speaker 12: That makes these figures completely uncomparable and very difficult to navigate. 234 00:12:51,160 --> 00:12:54,320 Speaker 2: Does this put in peril the whole idea then, of ESG. 235 00:12:54,440 --> 00:12:56,360 Speaker 2: If we can't define it, it makes it much more 236 00:12:56,360 --> 00:12:57,199 Speaker 2: difficult to track. 237 00:12:57,640 --> 00:12:59,680 Speaker 12: I think you're right to highlight that there's obviously been 238 00:12:59,720 --> 00:13:02,040 Speaker 12: a lot of anti ESG rhetoric, particularly in the US, 239 00:13:02,120 --> 00:13:04,840 Speaker 12: and even skepticism in other parts of the world. I 240 00:13:04,880 --> 00:13:08,200 Speaker 12: think banks are operating in a vacuum right now where 241 00:13:08,200 --> 00:13:11,520 Speaker 12: there isn't a regulatory definition of what is sustainable finance investments, 242 00:13:11,559 --> 00:13:13,839 Speaker 12: and therefore they have to make up their own definitions. 243 00:13:14,200 --> 00:13:16,160 Speaker 12: And I think if you're seeing some banks push the 244 00:13:16,280 --> 00:13:18,040 Speaker 12: envelope a little bit in a way that is a 245 00:13:18,080 --> 00:13:20,839 Speaker 12: little bit dubious, that's going to only add to the skepticism. 246 00:13:21,120 --> 00:13:23,200 Speaker 1: Yeah, what have a few of the examples that you've 247 00:13:23,200 --> 00:13:27,600 Speaker 1: turned up about what the different definitions in sustainable finance mean. 248 00:13:29,200 --> 00:13:31,560 Speaker 1: What are some of the examples that you've got. 249 00:13:31,640 --> 00:13:34,560 Speaker 12: So, I think one key example is M and A. 250 00:13:34,960 --> 00:13:38,480 Speaker 12: It's obviously M and A deals are massive. They can 251 00:13:38,520 --> 00:13:41,040 Speaker 12: go into the tens of billions of dollars, whereas some 252 00:13:41,160 --> 00:13:44,400 Speaker 12: banks counting M and A transactions as being sustainable finance 253 00:13:44,480 --> 00:13:46,600 Speaker 12: and other banks that are not. And you can quickly 254 00:13:46,640 --> 00:13:48,960 Speaker 12: imagine that if one bank doesn't, one bang doesn't, that 255 00:13:49,040 --> 00:13:51,599 Speaker 12: quickly skews their figures. So when it comes down to 256 00:13:51,679 --> 00:13:54,199 Speaker 12: things like that, that can completely change the understanding. Do 257 00:13:54,200 --> 00:13:57,320 Speaker 12: you also have very niche products like ESG derivatives, lots 258 00:13:57,360 --> 00:13:59,720 Speaker 12: of banks don't touch them, don't think they're sustainable finance. 259 00:14:00,080 --> 00:14:03,199 Speaker 12: Other banks count them towards their targets very quickly. You 260 00:14:03,240 --> 00:14:04,959 Speaker 12: can see the inconsistencies add up. 261 00:14:05,200 --> 00:14:09,040 Speaker 2: So how then can investors and consumers who want to 262 00:14:09,080 --> 00:14:12,360 Speaker 2: know where the money is going, how a particular bank 263 00:14:12,720 --> 00:14:15,120 Speaker 2: is behaving, How can they actually assess that? 264 00:14:15,559 --> 00:14:17,880 Speaker 12: It's very difficult for them, and that is the problem. 265 00:14:17,960 --> 00:14:20,240 Speaker 12: I'm speaking to a lot of researchers who are specializing 266 00:14:20,240 --> 00:14:22,360 Speaker 12: on this, and they struggle to navigate this through all 267 00:14:22,400 --> 00:14:25,880 Speaker 12: the disclosures, for all the small prints. So if your 268 00:14:25,960 --> 00:14:28,120 Speaker 12: consumer and want to know of your bank is actively 269 00:14:28,160 --> 00:14:30,960 Speaker 12: contributing towards the climate transition, you can speak to experts, 270 00:14:31,080 --> 00:14:33,440 Speaker 12: you can read news articles about them, but it's very 271 00:14:33,480 --> 00:14:36,080 Speaker 12: difficult to find a single number that will tell you 272 00:14:36,120 --> 00:14:37,640 Speaker 12: this bank is better than this bank. 273 00:14:37,880 --> 00:14:40,680 Speaker 1: Okay, regulators looking into this now, then. 274 00:14:40,800 --> 00:14:44,000 Speaker 12: They are, I think the Financial Conduct Authority in the 275 00:14:44,080 --> 00:14:46,040 Speaker 12: UK they wrote led it to the banks heads of 276 00:14:46,080 --> 00:14:49,120 Speaker 12: VSG earlier this year and they raised a number of concerns. 277 00:14:49,200 --> 00:14:51,440 Speaker 12: One of them was the fact that lots of bankers 278 00:14:51,640 --> 00:14:54,600 Speaker 12: their remuneration, their bonuses are set to the meeting of 279 00:14:54,640 --> 00:14:58,240 Speaker 12: these targets, and that creates potential conflicts of interests. You 280 00:14:58,280 --> 00:15:01,120 Speaker 12: can imagine that if you're banker and you want to 281 00:15:01,160 --> 00:15:04,280 Speaker 12: achieve your bonus, you might be pressured to slap the 282 00:15:04,280 --> 00:15:07,120 Speaker 12: sustainable label on a product that baby doesn't meet the 283 00:15:07,160 --> 00:15:09,840 Speaker 12: grades in order to help you meet that bonus. So 284 00:15:09,880 --> 00:15:11,680 Speaker 12: they started to think about it and think it might 285 00:15:11,720 --> 00:15:14,280 Speaker 12: seem more formal regulatory intervention in the coming years. 286 00:15:14,400 --> 00:15:17,240 Speaker 2: Are the banks themselves worried about being accused of greenwashing? 287 00:15:17,600 --> 00:15:18,080 Speaker 7: Definitely. 288 00:15:18,160 --> 00:15:19,800 Speaker 12: So I speak to quite a few of the heads 289 00:15:19,800 --> 00:15:22,560 Speaker 12: of ESG for the story, and one thing that they 290 00:15:22,640 --> 00:15:25,880 Speaker 12: keep on telling us is how courses they're becoming. You know, 291 00:15:26,000 --> 00:15:27,960 Speaker 12: maybe two years ago they would have put a label 292 00:15:28,000 --> 00:15:30,480 Speaker 12: on something that they wouldn't do. Now that's because of 293 00:15:30,520 --> 00:15:33,200 Speaker 12: the increased scrutiny, and many of them think that next year, 294 00:15:33,280 --> 00:15:37,240 Speaker 12: as last laps up, that they're going to face many 295 00:15:37,280 --> 00:15:39,360 Speaker 12: different green washing risks that they need to navigate. 296 00:15:39,680 --> 00:15:42,600 Speaker 1: Okay, it's a really interesting piece, great research. Greg, thank 297 00:15:42,640 --> 00:15:44,840 Speaker 1: you so much for joining us and talking us through 298 00:15:44,880 --> 00:15:48,400 Speaker 1: that story around green financing. And the biggest banks in 299 00:15:48,440 --> 00:15:50,920 Speaker 1: the world are Greg Ritchie. They're our markets reporter. 300 00:15:51,160 --> 00:15:53,760 Speaker 2: Now, Bill Gates says the world probably won't meet the 301 00:15:53,800 --> 00:15:57,040 Speaker 2: Paris Agreement's goal of keeping the rise in global temperatures 302 00:15:57,080 --> 00:15:59,920 Speaker 2: to one and a half degrees. However, the Microsoft co 303 00:16:00,040 --> 00:16:02,240 Speaker 2: friend or praise the COP twenty eight summitch for making 304 00:16:02,360 --> 00:16:07,600 Speaker 2: progress untackling climate change despite geopolitical tensions. Okay. When speaking 305 00:16:07,600 --> 00:16:10,880 Speaker 2: to Bloomberg's Francine Laquat in Dubai, she asked him how 306 00:16:10,920 --> 00:16:13,120 Speaker 2: he measures success in this field. 307 00:16:15,200 --> 00:16:17,200 Speaker 7: I'm optimistic in general. 308 00:16:17,440 --> 00:16:20,680 Speaker 6: A lot of the power of human innovation is showing 309 00:16:20,760 --> 00:16:22,480 Speaker 6: here and in all the work I do. 310 00:16:23,200 --> 00:16:24,160 Speaker 7: What does that mean? 311 00:16:24,480 --> 00:16:28,200 Speaker 13: Does that mean that you measure success as in pledges? 312 00:16:28,480 --> 00:16:32,040 Speaker 13: Do we measure success as trying to do better and 313 00:16:32,120 --> 00:16:33,560 Speaker 13: putting more money where it should be. 314 00:16:34,880 --> 00:16:37,120 Speaker 6: Well, in the end, it's all about the human condition. 315 00:16:38,840 --> 00:16:43,680 Speaker 6: You know, more people are living longer. You know, we've 316 00:16:43,680 --> 00:16:47,680 Speaker 6: cut childhood death and half claimate is this negative thing 317 00:16:48,800 --> 00:16:53,400 Speaker 6: that's slowing down that progress? And so in mitigation, you know, 318 00:16:53,440 --> 00:16:56,080 Speaker 6: we want to make sure the temperature doesn't get too high, 319 00:16:56,520 --> 00:16:58,640 Speaker 6: and then an adaptation, we want to make sure that 320 00:16:58,720 --> 00:17:03,440 Speaker 6: the ill effects that whatever we can't mitigate, that it 321 00:17:03,520 --> 00:17:08,800 Speaker 6: doesn't reverse this incredible rate of human improvement. 322 00:17:09,040 --> 00:17:09,679 Speaker 7: But what are you. 323 00:17:09,720 --> 00:17:12,880 Speaker 13: Most optimistic about? Is it business or is it actually 324 00:17:12,960 --> 00:17:14,520 Speaker 13: leaders coming together with pledges? 325 00:17:15,800 --> 00:17:15,960 Speaker 7: Well? 326 00:17:16,080 --> 00:17:22,080 Speaker 6: Climate change overall, it's a challenge to the world. Hydrocarbons 327 00:17:22,080 --> 00:17:27,679 Speaker 6: have been very cheap. Our economy is built around you know, coal, 328 00:17:28,359 --> 00:17:33,119 Speaker 6: gas oil, and so we have to make this change. 329 00:17:33,680 --> 00:17:39,520 Speaker 6: The progression of inventing new approaches green approaches, and then 330 00:17:39,760 --> 00:17:43,560 Speaker 6: implementing them and over time scaling them and getting them 331 00:17:43,600 --> 00:17:48,200 Speaker 6: so cheap what I call zero green premium. You first 332 00:17:48,240 --> 00:17:51,000 Speaker 6: have to have risk capital. Then you have to have 333 00:17:51,800 --> 00:17:55,680 Speaker 6: bigger amounts capital, eventually as they say, trillions of dollars 334 00:17:56,119 --> 00:18:00,080 Speaker 6: to get every country to replace its steel plants, a 335 00:18:00,200 --> 00:18:05,000 Speaker 6: cement plans, and so depending on the emissions area. Some 336 00:18:05,119 --> 00:18:07,760 Speaker 6: of these things like steel and cement were at the 337 00:18:08,000 --> 00:18:11,160 Speaker 6: very early stage. Some like electric cars at least at 338 00:18:11,160 --> 00:18:15,920 Speaker 6: the high end the green premium you could say zero, 339 00:18:16,280 --> 00:18:19,080 Speaker 6: not for low cost cars where you park on the street. 340 00:18:19,240 --> 00:18:25,480 Speaker 6: But you so all these things and the faster we go, 341 00:18:26,440 --> 00:18:29,160 Speaker 6: the less temperature increase. 342 00:18:29,200 --> 00:18:29,760 Speaker 7: We'll see. 343 00:18:29,840 --> 00:18:32,199 Speaker 13: But do you think we're going fast enough to actually 344 00:18:32,440 --> 00:18:34,760 Speaker 13: hit the targets that were set out in the Paaris agreement. 345 00:18:34,920 --> 00:18:39,640 Speaker 6: No, we won't hit hit no to aspirational targets. Well, 346 00:18:39,640 --> 00:18:44,520 Speaker 6: you can do the math on one point five and 347 00:18:44,920 --> 00:18:48,680 Speaker 6: even two point zero. Isn't that likely? 348 00:18:48,840 --> 00:18:49,040 Speaker 7: Now? 349 00:18:49,119 --> 00:18:53,040 Speaker 6: Fortunately, if you stay below three, a lot of the 350 00:18:53,080 --> 00:18:56,639 Speaker 6: ill effects that people have heard about don't happen unless 351 00:18:56,680 --> 00:18:59,399 Speaker 6: you really are irresponsible and let it get up to 352 00:18:59,520 --> 00:19:01,160 Speaker 6: the the higher range. 353 00:19:01,440 --> 00:19:06,080 Speaker 13: Where do you see the role of fossil fuels going forward, Well. 354 00:19:05,920 --> 00:19:08,359 Speaker 7: We have to outcompete fossil fuels. Now. 355 00:19:08,920 --> 00:19:12,840 Speaker 6: To do that properly, they you know, they shouldn't get subsidies, 356 00:19:12,880 --> 00:19:16,879 Speaker 6: and in fact, a carbon tax over time should be 357 00:19:16,920 --> 00:19:19,639 Speaker 6: put on so that the new you know, say the 358 00:19:19,680 --> 00:19:24,600 Speaker 6: electric car or the plane that use hydrogen, the fact 359 00:19:24,640 --> 00:19:29,520 Speaker 6: that it doesn't emit carbon, you're helping it get adoption. 360 00:19:30,280 --> 00:19:32,760 Speaker 6: Those companies have skills, you know, if you want to 361 00:19:32,800 --> 00:19:37,439 Speaker 6: sequester carbon or you know, nuclear wayte or there's a 362 00:19:37,440 --> 00:19:40,880 Speaker 6: lot of skills if you want to make biofuels. 363 00:19:41,160 --> 00:19:41,280 Speaker 5: Uh. 364 00:19:41,960 --> 00:19:43,000 Speaker 7: You know, some of those. 365 00:19:42,760 --> 00:19:45,600 Speaker 6: Companies will take the capital and skills they have. 366 00:19:46,359 --> 00:19:46,479 Speaker 5: Uh. 367 00:19:47,200 --> 00:19:49,639 Speaker 6: You know, so I wouldn't you know, say okay, I 368 00:19:49,680 --> 00:19:53,359 Speaker 6: wish they weren't there. You know, people still, you know, 369 00:19:53,400 --> 00:19:57,160 Speaker 6: there's no country that can say, okay, we have zero emissions. 370 00:19:57,440 --> 00:19:59,920 Speaker 7: Uh. You know, people want to drive to work. 371 00:20:00,280 --> 00:20:00,479 Speaker 11: You know. 372 00:20:00,520 --> 00:20:05,320 Speaker 6: In fact, the excess supply when Russia cut off its 373 00:20:05,320 --> 00:20:09,360 Speaker 6: supply in the world was sort of glad that that 374 00:20:09,600 --> 00:20:13,919 Speaker 6: was available, and so, yes, oil and gas needs to 375 00:20:13,960 --> 00:20:19,320 Speaker 6: be out competed, and those companies need to join the effort. 376 00:20:19,600 --> 00:20:21,600 Speaker 13: I know you look at a lot of technologies and 377 00:20:21,640 --> 00:20:23,560 Speaker 13: a lot of innovation, But is there one thing that 378 00:20:23,600 --> 00:20:26,960 Speaker 13: you've been most excited about in the past five years 379 00:20:27,040 --> 00:20:29,359 Speaker 13: or that you're most excited about for the future. I 380 00:20:29,359 --> 00:20:31,160 Speaker 13: know we talked about nuclear fuel. I mean we talk 381 00:20:31,200 --> 00:20:34,639 Speaker 13: a lot about the really big, you know, exciting stuff. 382 00:20:34,680 --> 00:20:35,840 Speaker 7: What are you excited about? 383 00:20:36,880 --> 00:20:40,359 Speaker 6: Well, you know, I love all my children, and I 384 00:20:40,440 --> 00:20:43,600 Speaker 6: have these one hundred companies, and you know, I never 385 00:20:43,640 --> 00:20:47,080 Speaker 6: knew that we'd get a new way to make steel 386 00:20:47,240 --> 00:20:51,040 Speaker 6: or cement or beef. It's fair to say that if 387 00:20:51,080 --> 00:20:55,560 Speaker 6: we can get either nuclear fission or fusion to be 388 00:20:56,560 --> 00:21:02,240 Speaker 6: safe and broadly accepted and very economic because it's not 389 00:21:02,359 --> 00:21:06,360 Speaker 6: whether dependent, it would be very complementary to the large 390 00:21:06,640 --> 00:21:09,600 Speaker 6: amount of solar and wind that we're putting into our 391 00:21:09,640 --> 00:21:10,600 Speaker 6: electric system. 392 00:21:10,680 --> 00:21:12,760 Speaker 7: And so I'm biased. 393 00:21:12,800 --> 00:21:16,640 Speaker 6: I'm a huge investor in both fission and fusion and 394 00:21:16,800 --> 00:21:21,480 Speaker 6: hoping that it comes in time. We can't count on it, 395 00:21:22,880 --> 00:21:25,639 Speaker 6: you know, fission it has been too expensive, and fusion 396 00:21:25,680 --> 00:21:28,160 Speaker 6: doesn't exist yet. 397 00:21:28,280 --> 00:21:31,679 Speaker 13: But Fusion fifteen years from now, like what's your I 398 00:21:31,680 --> 00:21:32,879 Speaker 13: know it's a guess. At the moment. 399 00:21:33,080 --> 00:21:37,880 Speaker 6: Well, of the four companies I'm invested in, one of them, 400 00:21:38,240 --> 00:21:40,919 Speaker 6: Commonwealth Fusion has a credible path. Things will have to 401 00:21:40,960 --> 00:21:45,199 Speaker 6: go well that in the late twenty thirties they'd be 402 00:21:45,320 --> 00:21:50,720 Speaker 6: making electricity and start to scale it up. So that's 403 00:21:50,760 --> 00:21:52,919 Speaker 6: an aspiration. But it's a great company. And we have 404 00:21:53,640 --> 00:21:57,399 Speaker 6: three others that aren't quite that early, but you know, 405 00:21:57,400 --> 00:21:59,760 Speaker 6: are within five to ten years of that. 406 00:22:01,400 --> 00:22:04,119 Speaker 2: This is Bloomberg Daybreak Europe, your morning brief on the 407 00:22:04,200 --> 00:22:07,240 Speaker 2: stories making news from London to Wall Street and beyond. 408 00:22:07,520 --> 00:22:10,719 Speaker 1: Look for us on your podcast feed every morning, on Apple, 409 00:22:10,840 --> 00:22:13,560 Speaker 1: Spotify and anywhere else you get your podcasts. 410 00:22:13,600 --> 00:22:16,600 Speaker 2: You can also listen live each morning on London Dab Radio, 411 00:22:16,640 --> 00:22:19,359 Speaker 2: the Bloomberg Business app, and Bloomberg dot Com. 412 00:22:19,400 --> 00:22:22,160 Speaker 1: Our flagship New York station is also available on your 413 00:22:22,200 --> 00:22:26,919 Speaker 1: Amazon Alexa devices. Just say Alexa play Bloomberg eleven thirty. 414 00:22:27,119 --> 00:22:28,440 Speaker 1: I'm Caroline Hepka and. 415 00:22:28,359 --> 00:22:31,040 Speaker 2: I'm Stephen Carroll. Join us again tomorrow morning for all 416 00:22:31,080 --> 00:22:33,480 Speaker 2: the news you need to start your day right here 417 00:22:33,520 --> 00:22:39,040 Speaker 2: on Bloomberg Daybreak Europe.