Wall Street thinks climate goals will fail and we will need more air-con

Oliver Milman, reporting for the Guardian:

Recent reports by Morgan Stanley, JPMorgan Chase and the Institute of International Finance all make clear the finance sector considers the Paris climate agreement limiting global temperatures, signed a decade ago by nearly 200 nations, is effectively dead and investors should plan accordingly.

“We now expect a 3C world,” states a March analysis by Morgan Stanley. This level of global heating above preindustrial times is well beyond the 2C limit agreed to by governments and would lead to catastrophic heatwaves, floods, economic strife and other upheavals.

The Morgan Stanley investor research forecasts, though, that multiplying heatwaves will provide a windfall for companies that provide air conditioning, and that the global market could grow by 41% to be worth $331bn by the end of this decade. The analysis outlines several dozen air conditioning businesses around the world that are likely to profit from a hotter world.

The finance whizzes on Wall Street think the world is not doing enough to stop climate change (partly thanks to their own moral cowardice), so we will need more air conditioning? No shit, Sherlock.

Paddy McCully, senior analyst at Reclaim Finance, said it well:

“It is to a very large extent being influenced by Trump and his agenda of accelerating climate change, although also due to banks using Trumpism as an excuse to roll back commitments that they had never actually intended to keep.”

Morgan Stanley’s investor research on air conditioning is “mind numbingly cynical”, McCully said. “Especially as it comes just months after they first weakened their decarbonization targets and then quit the Net Zero Banking Alliance.”

The problem with predicting the future is not that it’s futile. We should have all learnt the lesson since at least 2016. The problem is that predictions, especially reputable ones like this, limit our ability to imagine a different future.

These predictions are different from IPCC saying “if we don’t stop using fossil fuels and halve emissions by 2030, we are screwed”. IPCC is not making a prediction about the future. They are connecting our collective choices with the consequences of these choices. Ultimately, it’s clear that the choice is in our hands.

But when Wall Street says they “expect a 3C world”, they don’t mention the power and choices we still have to slow down and shave off every fraction of a degree in warming. They present one possible future as if it’s preordained because, well, if you don’t pay them $2,500 an hour to meet their stock analysts, who’d let you in on the secret that people will want more air-con as the world becomes hotter?