The looming issue of climate change has far-reaching implications, not least of which are relevant to the financial and investment world. Today we spend some time considering these impacts, with a focus on the question of whether climate risk is a priced investment. The short answer, conferred by the numerous academic explorations into the subject, is yes. This answer, however, still leaves investors with many options and contrasting possible approaches as to how to act. We get into some of the different avenues to explore when considering your best route, taking into account both ethical constraints and returns, as well as a long-term vision of sustainability. We also talk about why big companies with less of a focus on ethics may be tempted to go green for financial reasons, how investors might enact a moral stance by investing in fewer green companies, and many more surprising possibilities that arise out of the current findings. Rounding out all this serious discussion, we squeeze in an interesting book review from Hans Rosling, some Talking Sense questions, and of course, bad advice of the week, all of which you are not going to want to miss. Timestamps: 0:00 - 9:11 Intro 9:12 - 16:19 Cameron’s recommendations 16:20 - 21:19 Recent news 21:20- 26:17 Physical / Transitional Climate Change Risk 26:18 - 35:09 Theory on Asset Prices, Discount Rates, Taste of Investors 35:10 - 43:33 The relationship between asset prices and climate risk 43:34 - 54:36 Climate Change’s Impact in a Portfolio 54:37 - 1:00:32 Talking Cents 1:00:33 - End Bad Advice of the Week Books From Today’s Episode: How to Change — https://amzn.to/363m9pB Factfulness — https://amzn.to/3y83B3y The Coffeehouse Investor's Ground Rules - https://amzn.to/3hqJsyQ Links From Today’s Episode: Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder Website — https://rationalreminder.ca/ Follow us on Twitter - https://twitter.com/RationalRemind Follow us on Instagram - @rationalreminder Benjamin on Twitter — https://twitter.com/benjaminwfelix Cameron on Twitter — https://twitter.com/CameronPassmore 'Wealthfront in its sixth pivot as a firm, reduces its robo-advisors role and puts decision-making power where it belongs with retail investors' — https://riabiz.com/a/2021/6/16/wealthfront-in-its-sixth-pivot-as-a-firm-reduces-its-robo-advisors-role-and-puts-decision-making-power-where-it-belongs-with-retail-investors Burton Malkiel — https://www.marketwatch.com/story/investing-legend-burton-malkiel-on-day-trading-millennials-the-end-of-the-6040-portfolio-and-more-2020-06-22 'Sustainable investing in equilibrium' — https://www.sciencedirect.com/science/article/abs/pii/S0304405X20303512 'Market Expectations About Climate Change' — https://www.nber.org/papers/w25554 'An Inconvenient Cost to the Effects of Climate Change On Municipal Bonds' — https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3167379 'Disaster on the Horizon: The Price Effect of Sea Level Rise' — https://www.sciencedirect.com/science/article/abs/pii/S0304405X19300807 'Science and the Stock Market - Investors’ Recognition of Unburnable Carbon' — https://www.sciencedirect.com/science/article/pii/S0140988315002546 'Environmental Externalities and Cost of Capital' — https://www.jstor.org/stable/24550583 'Carbon Tail Risk' — https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3204420 'Climate Regulatory Risks and Corporate Bonds' — https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3563271 'Greenhouse Gas Emissions and Expected Returns' — https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3714874 'Can't Decide Between Gold or Bitcoin. Why Not Both?' — https://www.usfunds.com/investor-library/frank-talk-a-ceo-blog-by-frank-holmes/cant-decide-between-gold-or-bitcoin-why-not-both/ Paul Tudor Jones — https://www.cnbc.com/2021/06/14/paul-tudor-jones-says-bet-heavily-on-every-inflation-trade-if-fed-keeps-ignoring-higher-prices.html The Economic Limits of Bitcoin and the Blockchain - https://faculty.chicagobooth.edu/eric.budish/research/Economic-Limits-Bitcoin-Blockchain.pdf University of Chicago survey would gold be a better system, or gold-backed currency be a better system? - https://www.igmchicago.org/surveys/gold-standard/ Would a Gold Standard Brighten Economic Outcomes? https://research.stlouisfed.org/publications/page1-econ/2015/01/01/would-a-gold-standard-brighten-economic-outcomes/