https://nypost.com/2020/06/23/billionaire-ubben-says-liz-warren-inspiration-to-exit-valueact/amp/ ====== By Thornton McEnery June 23, 2020 | 7:53pm An activist investor declared that “Elizabeth Warren is right” as he left the helm of his giant hedge fund to focus on environmental and social-impact investing. Jeffrey Ubben — a corporate cage-rattler who has prodded for change at behemoths including Microsoft, BP and Nintendo — said he is leaving his $16 billion hedge fund, ValueAct Capital, to start a new fund that’s more socially conscious. On his way out, the 57-year-old financier took the opportunity to blast corporate greed on Wall Street. “Companies, as governed today, with investors asking for more current returns and more buybacks and so forth, aren’t working for society or nature,” Ubben told the Financial Times in an interview. The San Francisco-based hedgie went on to dismiss activist investors who “bully little companies to sell to private equity,” opining that the strategy has played itself out. “Finance is, like, done. Everybody’s bought everybody else with low-cost debt. Everybody’s maximized their margin. They’ve bought all their shares back,” Ubben said. “There’s nothing there. Every industry has about three players.” “Elizabeth Warren is right,” he added, referring to the US Senator who has been a gadfly for private equity companies for years, introducing legislation to curb their power in July 2019. Ubben, who founded ValueAct in 2000, said his new fund, Inclusive Capital Partners, will seek to create big returns by pressuring big companies to tackle environmental and social problems. “When you’re talking about addressing climate change with a business solution, that is the biggest problem in the world,” Ubben said. “That’s like a 10-times-your-money deal.” ======
I don't see how "environmental and social impact investing" can possibly create any economic returns, let alone big returns, beyond just snaffling up government subsidies (and they have to be poorly-designed subsidies at that if there are tons of fat profits to be skimmed off). Not to say that subsidies are bad, or that we shouldn't be trying to save the earth, but the idea of becoming wealthy by doing so is nonsensical. If people are becoming wealthy, we aren't doing it right. The things that create capitalist wealth (consumerism, over-consumption of junk, planned obsolescence, externalizing environmental and other costs etc) are diametrically opposed to the things which must be done to save the planet.
Rather, Andrew Yang is right. We need human capitalism. As for Warren, I always get confused, is that the old guy that got married in Russia? Anyways, if Ubben gives away all his money and goes live in a dirt hovel, than I'll listen to him. This just sounds like the markets are stressing him out so he's gone wiggy and quit his day job. A lot of people are complaining about the current market as being speculative, but it's not clear yet. It's possible that the virus has accelerated us to a fully internet based economy (remote work, online ordering) which in fact could accelerate productivity and GDP growth. I don't know if that's true, but I don't think anyone knows yet. The jury is still out. It's very very hard to know when you're actually in a bubble, this has been proven time and time again.. Btw, shouldn't this be in the politics forum?
“On his way out, the 57-year-old financier took the opportunity to blast corporate greed on Wall Street.” LOL from a greedy bastard who made billions from wall st. Hypocrisy and liberals, two peas in a pod
I'd disagree pretty strongly with that assertion. For example, ten years ago solar was $6 a watt and power produced by solar cost around $200/MWH. This year we've routinely seen large unsubsidized tenders come back at $15/MWH or less, which is a fraction of the $60-$130/MWH of coal plants. The industry required incentives to come down that cost curve, but that is a hell of a return on that investment in just a decade. Now we need to build out gigawatts of solar and wind to replace a hundred years worth of fossil fuel plants. That can be done at a profit while still saving everyone in the world a significant amount of money....even if you completely ignore all the health and environmental benefits. It's going to take trillions of private capital to make that happen. Plenty of returns to be had there, without a dollar of additional government funding.
Hypocrisy knows no political boundaries, let's not get on our high horse here. I could list 100 things off the top of my head that conservatives were for before they were against them. Like the Heritage Foundation health plan that became the Affordable Care Act, for example? Maybe the whole deficit you all cried big crocodile tears over until you blew it up before COVID with a massive tax cut. I could go on and on, but let's just agree to stop with the sanctimonious BS when it comes to hypocrisy shall we?
I thought this thread was about Ubben gave up all his wealth, donated it all to save the environment. But to cash out, then started a new fund and to make more money for himself? My respect goes to Gates for donating all his wealth, championed environmental causes, invested in third world health... also to the other Warren (Warren Buffett) for doing the same.
None of this says anything about economic returns on capital or profits, which was the subject of my comment. In terms of generating big returns, the only significant success story (if you can call it that) I'm aware of in the "environmental investing" arena is TSLA - which has so far only consumed vast quantities of capital, currently trades at an infinite PE, and the environmental benefits are pretty questionable. The underlying truth is that saving the earth requires producing, doing, and consuming less of everything. That folks are somehow going to get rich via this process is a useful delusion, when it comes to raising those trillions of private capital you mentioned - but it's still a delusion.
I can tell you from first hand experience you can make significant economic returns and profits from building solar farms. Not sure how I could be more clear, we can replace terawatts of now far more expensive coal and nuclear power with solar and wind. That doesn't happen by magic, it requires financing at all levels from very speculative project development stage to much more mature completed project debt stage. Trillions of dollars worth worldwide. How is that not an opportunity for return on capital and profits?