Former Governor of the Bank of Canada and Bank of England, Mark Carney, shares his career trajectory from banking to governing. He discusses the response of central banks to inflation and predicts further tightening. They explore Silicon Carbide technology in electric vehicles and the challenges small companies face in raising capital. Carney's various leadership roles and responsibilities, including being a special advisor to the UN on climate action and finance, are highlighted. His journey to success is reflected upon, with a mention of podcast sponsors.
Central banks recognized the severity of inflation too late due to supply shocks but effectively addressed concerns through resolute action.
Mark Carney emphasizes the importance of organizing the private financial system to address climate change and highlights the progress made in increasing investments in clean energy.
Deep dives
Mark Carney's Impressive Career and Roles in Global Leadership
Mark Carney is a highly respected and accomplished global leader who has served as the governor of both the Bank of Canada and the Bank of England. He is currently a special UN envoy for Climate Action Finance and chairs Brookfield Asset Management. Carney's professional journey began in investment banking at Goldman Sachs in London, where he worked in the credit department. He then pursued a PhD in economics at Oxford University. Carney's career in public policy started when he became the deputy governor of the Bank of Canada, eventually rising to governor. He later took on the role of governor of the Bank of England. Carney highlights the challenges faced during his tenure, including managing the global financial crisis, Brexit, and other geopolitical issues. After leaving central banking, Carney assumed various roles, including the special envoy for Climate Action and Finance for the UN. He is currently the chairman of Brookfield Asset Management and Bloomberg. Throughout his career, Carney exemplifies a strong work ethic, a passion for public service, and a deep understanding of the intersection between public policy and private markets.
Recognizing the Importance of Climate Change and Central Banks' Response
Carney discusses the evolving understanding of climate change among central banks. He believes that central banks, initially operating under an outdated paradigm, recognized the severity of inflation too late due to supply shocks caused by COVID-19, energy, supply chains, and geopolitics. However, once central banks responded, particularly the US Federal Reserve, they demonstrated resolute action and effectively addressed inflation concerns. Carney expects further tightening by the Fed with an additional rate increase this year. He emphasizes that the trajectory of monetary policy over the next 12 to 18 months is essential in bringing inflation back to the desired level. Carney also shares insights on the potential for a global recession, highlighting the resilience of the US economy and reduced unemployment rates as factors that make a recession less likely. However, he acknowledges that many global factors influence the probability of a recession.
Carney's Role as Special Envoy for Climate Action and Finance
As the special UN envoy for Climate Action Finance, Carney's focus is on organizing the private financial system to address climate change. He aims to mobilize capital and channel it towards investments that facilitate emissions reduction. Carney highlights the progress made over the past few years, with increased global investments in clean energy and a shift towards low-carbon solutions. He emphasizes the importance of recognizing specific actions that contribute to emission reduction and driving value in the market. Carney also addresses the challenges and complexities surrounding climate action, such as the need for fair and inclusive global cooperation, considering the disproportionate impacts of climate change on developing nations. He concludes by advocating for a collective effort to mitigate climate change and emphasizes the value of a sustainable financial system.
Brookfield Asset Management Chair Mark Carney recounts his one-of-a-kind career trajectory from Governor of the Bank of Canada to Governor of the Bank of England and shares his current economic outlook, including another rate hike from the Federal Reserve in 2023. He speaks on "The David Rubenstein Show: Peer-to-Peer Conversations." This interview was recorded October 2 in New York. Mark Carney has been named Chairman of Bloomberg Inc.'s board of directors.
