Showing posts with label Electric Vehicles. Show all posts
Showing posts with label Electric Vehicles. Show all posts

Monday, January 3, 2022

Few Things to Know About Our Current Energy Transition from Fossil Fuels to Renewables.

In a discussion hosted by Bridgewater Associates (the world's largest hedge fund), Daniel Yergin discussed the current energy transition, geopolitics, and government. Daniel Yergin emphasizes a few things about our energy transition:

  • Energy transition to oil from coal took nearly a hundred years. 
  • Instead of trying to control oil supplies, now we are trying to control materials used in batteries and solar panels. Increasing lithium and cobalt prices pose a challenge for electric vehicles. 
  • Electric vehicles may need subsidies to make them affordable. 

Governments can offer subsidies, but the loss of revenue due to the subsidies need to be compensated by higher taxes, lower social benefits, or higher deficits. The world is grappling with excessive debt levels and does not have the flexibility to take on more deficit spending. Take the example of Japan, where the outstanding government bonds have crossed one thousand trillion yen for the first time.    

You can watch the Daniel Yergin discussion on YouTube.  

The Industrials Sector is on a Tear

 The Vanguard Industrials Index ETF ( VIS ) touched a 52-week high of $202.86 on Friday, June 16 (Exhibit 1) .   Exhibit 1: Vanguard Industr...