Icosian Reflections

…a tendency to systematize and a keen sense

that we live in a broken world.

IN  WHICH Ross Rheingans-Yoo—a sometime quantitative trader, economist, expat, EA, artist, educator, and game developer—writes on topics of int­erest.

Ben Kuhn sums up how Scott Aaronson sums up my thoughts on divestment
divestment, environmentalism

Aaronson:

I’m sensitive to the charge that divestment petitions are just meaningless sanctimony, a way for activists to feel morally pure without either making serious sacrifices or engaging the real complexities of an issue. In the end, though, that kind of meta-level judgment can’t absolve us of the need to consider each petition on its merits: if we think of a previous crisis for civilization (say, in the late 1930s), then it seems obvious that even symbolic divestment gestures were better than nothing.

What made up my mind was reading the arguments pro and con, and seeing that the organizers of this petition had a clear-eyed understanding of what they were trying to accomplish and why: they know that divestment can’t directly drive down oil companies’ stock prices, but it can powerfully signal to the world a scientific consensus that, if global catastrophe is to be averted, most of the known fossil-fuel reserves need to be left in the ground, and that current valuations of oil, gas, and coal companies fail to reflect that reality.

...

These realities [that averting more climate change requires extraordinary political will] have a counterintuitive practical implication that I wish both sides understood better. Namely, if you share my desperation and terror about this crisis, the urgent desire to do something, then limiting your personal carbon footprint should be very far from your main concern. Like, it’s great if you can bike to work, and you should keep it up (fresh air and exercise and all). But I’d say the anti-environmentalists are right that such voluntary steps are luxuries of the privileged, and will

READ MORE

Three Modest Proposals, Instead of Divesting...
harvard, modest proposals, divestment, wall street ate ross's soul, finance, environmentalism

The modest proposal comes after a bit of serious economics, because, well, you have to eat your vegetables before you get any dessert.

Also: Global warming is real and anthropocentric; we're going to need to stop it; we're going to need to stop using fossil fuels. If you don't believe these things, then I'm not going to try to convince you here. If you do believe these things, and also think that I'm wrong here, I'd be really, really, glad to hear it.

All of that said, the majority of this post is either intended as satire or double-satire; the only thing that I'll admit to honestly believing is that no one, not even Divest, is above a little tongue-in-cheek mockery.

Also, despite my use of the narrative first person, I am in no way involved with the Divest movement, at Harvard or elsewhere, except that sometimes I give them unsolicited financial advice.

Recently, Milo King, on Gains From Trade, asks: What is the economic impact of divestment? A few years ago, and seemingly unrelatedly, the HPR came to the same conclusion, namely:

Because the stock market is efficient, selling off stock for reasons unrelated to that company's profitability will cause more amoral investors to step in and kindly take your depressed-price shares, reaping the spread for themselves. No long-term depression of prices, no pain felt by Exxon et al., and now the shareholder voting those shares has worse morals than you did. Oops.

Consider, for example, the widely-acclaimed divestment from South Africa, in protest of apartheid...

Despite the prominence and publicity of the boycott and the multitude of divesting companies, the financial markets' valuations of targeted companies or even

READ MORE
1 / 1