Covid-19 lockdowns could drop carbon emissions to their lowest level in since World War II. But the change may be temporaryUpdated 11:24 AM EDT May 19, 2020

Covid-19 lockdowns could drop carbon emissions to their lowest level in since World War II. But the change may be temporary

Updated 11:24 AM EDT May 19, 2020

As predicted, carbon dioxide emissions have declined during the Covid-19 pandemic. But if past crises are any indication, the environmental gains may be short-lived.

An international study of global carbon emissions found that daily emissions declined 17% between January and early April, compared to average levels in 2019, and could decline anywhere between 4.4% to 8% by the year’s end. That figure would mark the largest annual decrease in carbon emissions since World War II, researchers said.

The findings appeared today in the journal Nature Climate Change.

It’s not clear how long or severe the pandemic will be, which makes it difficult to predict how emissions will be affected long-term. And because the changes driving reduced emissions haven’t fundamentally changed the economy or the energy much of the world relies on, the declines are likely to be temporary.

Plus, 2020 is still on track to be one of the top five hottest years on record.

“I can’t celebrate a drop in emissions driven by unemployment and forced behavior,” said Rob Jackson, study co-author and professor in Stanford University’s Earth Science Systems department. “We’ve reduced emissions for the wrong reasons.”

Researchers created a lockdown index

The study centered on 69 countries, all 50 US states and 30 Chinese provinces, which account for 85% of the world population and 97% of all global carbon dioxide emissions.

Real-time carbon emissions data doesn’t exist, so researchers made their own algorithm. They created a confinement index based on the severity of pandemic policies — 0 represents no policy, and 3 represents a maximum lockdown with stay-at-home orders and a shuttered economy.

They used that lens when they examined daily data from six sectors of the economy that contribute to carbon emissions, including transportation, aviation, industry and commerce. With the confinement index indicating the severity of countries’ lockdowns and these data on drops in carbon-emitting activities, they could predict changes in daily emissions.

The carbon reductions were primarily driven by fewer people driving — surface transport activity levels dropped 50% by the end of April. The most significant decline in activity occurred in aviation — a 75% decrease — but it accounts for a smaller slice of global emissions, Jackson said.

By the end of April, carbon emissions declined by 1,048 metric tons of carbon dioxide, the researchers predicted — that’s roughly 2,312,649 pounds. The decline is largest in China, where the pandemic began, where emissions dropped 533,500-plus pounds. In the US, carbon emissions declined by 456,350-plus pounds. China and the US are the two largest carbon emitters globally.

What comes next

Whether these changes last — and whether they’ll make a difference in slowing climate change — depends on what the world does when the pandemic ends.

By the end of the year, emissions will have declined somewhere between 4.4% and 8%, the researchers predict. It’s the most significant decline in over a decade, but it’s the result of forced changes, not the restructuring of global economies and energy.

According to United Nations Environment projections, to keep global temperatures from rising more than 1.5 degrees Celsius, we need to reduce emissions by 7.6% every single year between now and 2030.

And in order to stay under 2 degrees Celsius of warming, which scientists agree is important to avoid the most devastating impacts of climate change, we need to continue to reduce emissions by 2.6%, per the 2015 Paris climate accords.

“Unfortunately, past crises suggest that emissions will rise again,” Jackson said.

He compared the pandemic to the last global crisis, the 2008-2009 Great Recession. Global emissions decreased 1.4% in 2009. Then, in 2010, emissions shot back up 5% — as if nothing had changed.

One crisis that did alter things fundamentally — the oil shocks in the 1970s, when shortages dramatically drove up gas prices. The energy shock prompted manufacturers to make smaller cars and move toward solar and wind power.

Still, he said, we can’t rely on a pandemic to solve our climate woes.

“Crises do not solve the climate problem,” he said. “They buy us a year or two’s worth of time at most.”

Transportation, he said, is one of the most significant emitters of carbon dioxide and also one of the most challenging sectors to change. Most people still drive gas-powered cars.

But, Jackson said, we’re presented with the opportunity to “jumpstart the electrification of mobility and transport.” Cities are already closing off roads so pedestrians and bicyclists can use them.

The virus may also make people leery of public transport, too, he said.

It’s not clear how society will change in the wake of the virus, but to prevent devastating climate change, “we need to electrify transport quickly, coupled with clean energy,” he said.

“The blue skies that people have seen as we’ve parked our cars have shown people what we could have every day by driving clean vehicles or walking and biking,” he said.

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MARC FABER: We’re In A Gigantic Financial Asset Bubble That Could Burst Any Day

MARC FABER: We’re In A Gigantic Financial Asset Bubble That Could Burst Any Day
MAMTA BADKAR
JAN. 14, 2014, 7:02 PM 11,190

As stocks returned a whopping 30% in 2013, there have been growing concerns about a stock market bubble. Especially considering that the rally supported by only meager earnings growth.
While many have made comprehensive arguments showing why stocks are not in a bubble, Marc Faber, author of “The Gloom Boom And Doom Report,” continues to argue that we’re in a bubble that’ll pop as we head for a financial crisis.
In an interview with Bloomberg TV, he says we are in a “gigantic financial asset bubble.” He also thinks the bubble could burst at any moment.
“I think we are in a gigantic financial asset bubble. But it is interesting that that despite of all the money printing, bond yields didn’t go down. They bottomed out on July 25, 2012 at 1.43% on the 10-years. We went to over 3.0%. We’re now at 2.85% or something thereabout. But we’re up substantially. Now, this hasn’t had an impact on stocks yet. In fact, it pushed money into the stock market out of the bond market. But if the 10-years goes to say 3.5% to 4.0%, then the 30-year goes to close to 5.0%, the mortgage rates go to 6.0%. That will hit the economy very hard.”
“[The bubble] could burst before. It could burst any day. I think we are very stretched. Sentiment figures are very, very bullish. Everybody’s bullish. The reality is they’re very bullish because they think the economy will accelerate on the upside. But my view is very different. The global economy is slowing down, because the global economy’s largely emerging economies nowadays, and there’s no growth in exports in emerging economies, there’s no growth, in the local economies. So, I feel that the valuations are high, the corporate profits have been boosted largely because of the falling interest rates.”
This is not a totally new call. Faber has repeatedly said that we’re headed for a 1987-type sell-off.
Faber also said Facebook is a fad and that lower interest rates are punishing savers. Here’s the entire transcript from Bloomberg TV:
———————————–
Faber on the Fed and how far the ‘rubber band can be stretched’:
“We have to distinguish between the financial economy, the financial sector, and the economy of the well-to-do people that benefit from rising asset prices, from rising prices of wines, and paintings and art, and bonds, and equities, and high-end properties in the Hamptons and West 15 here in New York and so forth — and the average person, the typical household, the so-called ‘median household’, or the working class people. And the Fed’s policies have actually led to a lot of problems around the world in the sense that they’re not only responsible, but partly responsible that energy prices are where they are, they’re up from $10 or $12 in 1999 to now around $100 a barrel. Food prices are up and a lot of other prices are up. So on your income, energy prices have very little impact because you at Bloomberg – you, young man – you make so much money. But for the poor people, it has an impact. Some people in the lower income groups, they spend say 30% of their income on energy, transportation, and so forth, electricity and gasoline.”
On whether the Fed is creating a two-class system:
“Correct, largely. The problem is then that you have people like Bill de Blasio, they come in and say: ‘you know what’s the problem? All these rich guys. Because of these rich people, you are poor. They take advantage of you. So, let’s go and tax them.’ The IMF has come out with a paper in Europe that essentially the well-to-do people should pay a 10% wealth task — a one-time wealth tax. I can assure you, a one-time wealth tax, 10%, will become an every-year’s tax eventually.”
On how to help the people on the lower end of the economic spectrum:
“This is the point I’d like to make. All of these professors and academics at the Fed who never really worked in the private sector a single day in their lives, and write papers nobody reads and nobody’s is interested in. Why would they want not write about how you structure an economic system that lifts the standard of living of most people? You can’t lift everybody.”
“We had that in the 19th century in the U.S. because we had very small government at the time. The entire government — local, state federal — was less than 20% of the economy. Now it is close to 50% of the economy.”
On whether the government is spending too much money:
“The larger the government becomes, the less economic growth you have and the more crony capitalism and corruptions you have. Because big corporations — and especially the money printers, they’re the most powerful people in the world, they control the governments. The U.S. Treasury, the Federal Reserve, and the government is one and the same. The Fed, they finance the Treasury, so the government can go to war in Iraq and Afghanistan. Then they finance transfer payments to essentially buy votes so you can get elected.”
On bitcoin:
“I prefer physical gold and silver, platinum to bitcoin. Bitcoin can have a lot of competition. Gold, silver, platinum — they have no competition. How do you value a bitcoin? I can value gold to some extent and compare say gold to the quantity of money that is floating around the world, to the wealth increase, and to the monetary base increase, to the credit increase, and so forth and so on, and to the production costs. So I have an idea of where gold should be. I’m not sure because prices overshoot. How do you value Netflix? Is it overpriced or underpriced? Is Tesla overpriced, underpriced?”
On interest rates:
“But one thing I wanted to show you and talk about because you said that lower interest rates help people. Well, if money trending helps everybody, then why does not everybody in the whole world always have zero interest rates? And everybody would be rich. You keep on printing money and you don’t need to work here, you don’t need to put on makeup. I could stay in bed the whole day and go drinking in the evenings. So, let’s just print money and be all happy. It doesn’t add up. One thing about the figures you showed: first of all, you live in New York. Do you really think that your cost-of-living increase is a 1.2% per annum? You really believe that? It doesn’t feel like more, it feels like five times more, or even ten times more.”
“Number two, by keeping interest rates at zero percent on the Fed fund rate — i want to emphasize that this is now going on in March of 2014 for five years. It is not something new. For five years this has happened. You penalize the income earners, the savers who save, your parents, why should your parents be forced to speculate in stocks and in real estate and everything under the sun?”
On his view of overvalued stocks, including Facebook:
“I think it is to a large extent a fad. People they go on Facebook – what they do is they put pictures on and the only people that watch these pictures are themselves. They all want to be stars. It is a very distractive kind of occupation. I can’t imagine that this would have a lot of value. I would rather own – I don’t own it because I think it is very highly priced – I would rather own a company like Alibaba or Amazon or Google, than Facebook, personally. This is my view. Other people have different views. That’s what makes the market. Some people are buying it and some people are selling it.”

On overall market valuation concerns:
“I think we are in a gigantic financial asset bubble. But it is interesting that that despite of all the money printing, bond yields didn’t go down. They bottomed out on July 25, 2012 at 1.43% on the 10-years. We went to over 3.0%. We’re now at 2.85% or something thereabout. But we’re up substantially. Now, this hasn’t had an impact on stocks yet. In fact, it pushed money into the stock market out of the bond market. But if the 10-years goes to say 3.5% to 4.0%, then the 30-year goes to close to 5.0%, the mortgage rates go to 6.0%. That will hit the economy very hard.”
“[The bubble] could burst before. It could burst any day. I think we are very stretched. Sentiment figures are very, very bullish. Everybody’s bullish. The reality is they’re very bullish because they think the economy will accelerate on the upside. But my view is very different. The global economy is slowing down, because the global economy’s largely emerging economies nowadays, and there’s no growth in exports in emerging economies, there’s no growth, in the local economies. So, I feel that the valuations are high, the corporate profits have been boosted largely because of the falling interest rates.”