Carbon Credit Trading, the next financial bubble to burst?by Jonathan DuHamel on Feb. 22, 2010, under Climate change
What would happen if a $300 billion commodity market were to suddenly evaporate? Of all the vested interests promoting the carbon cult of global warming, carbon credit trading is probably the largest and has the most to lose if the world comes to its senses.
An article in Harper’s magazine titled “Conning the Climate, Inside the carbon-trading shell game” by Mark Shapiro, a senior correspondent at the Center for Investigative Reporting in Berkeley, California, takes one through this game.
“Carbon trading is now the fastest-growing commodities market on earth. Since 2005, when major greenhouse-gas polluters among the Kyoto signatories were issued caps on their emissions and permitted to buy credits to meet those caps, there have been more than $300 billion worth of carbon transactions. Major financial institutions such as Goldman Sachs, Barclays, and Citibank now host carbon-trading desks in London; traders who once speculated on oil and gas are betting on the most insidious side effects of our fossil fuel–based economy. Over the next decade, if President Obama and other advocates can institute a cap-and-trade system in the United States, the demand for carbon credits could explode into a $2- to $3 trillion market.”
“…unlike traditional commodities, which sometime during the course of their market exchange must be delivered to someone in physical form, the carbon market is based on the lack of delivery of an invisible substance to no one.”
“Indeed, carbon exists as a commodity only through the decisions of politicians and bureaucrats, who determine both the demand, by setting emissions limits, and the supply, by establishing criteria for offsets.”
Many studies have found that projects ostensibly designed to qualify as carbon offset programs fail to produce the amount of emissions reduction promised.
If governments come to their senses and embrace the fact that there is no evidence that human carbon dioxide emissions are producing harmful climate change, these markets will evaporate along with the value of carbon credits. Will there be another bail-out?
Read Shapiro’s article here: