In this podcast, Krystal and Saagar discuss the GOP primaries, Federal Reserve interest rate raise, Ukraine war strategy, journalist polling, media elitism, Breaking Points profile, war sanction failure, Biden's lack of imagination, and the scam of ESG investing!
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Quick takeaways
The Federal Reserve has approved a significant rate increase to combat inflation and projected future rate rises.
The differing approaches between the US and its European allies on providing weapons assistance to Ukraine could strain the Western alliance.
The recent rate rise by the Federal Reserve may impact the housing market, discouraging potential buyers and slowing down sales.
ESG investing has faced criticism for discrepancies in evaluating companies, leading to a decline in investors and increased scrutiny from regulators.
Deep dives
Fed approves largest rate rise since 1994
The Federal Reserve has approved a 75 basis point increase, the largest rate rise since 1994, in an effort to bring down inflation. All officials at the meeting projected rates rising to 3%, and the economy is set to slow down with projected GDP growth for this year and next reduced from previous estimates.
US to deliver another billion dollars worth of military equipment to Ukraine
The United States has announced plans to deliver another billion dollars worth of military equipment to Ukraine, including weapons to defend the country's coast and additional artillery. This comes on top of previous billions in weapons sent to Ukraine. Meanwhile, reports indicate that Ukraine is not being transparent about the use of the weapons it has received thus far.
US allies show reluctance to share burden of weapons assistance to Ukraine
Germany, France, and other NATO allies have shown reluctance to match the US in providing weapons assistance to Ukraine. These countries are instead pushing for more peace talks in the region. The differing approaches between the US and its European allies could create a break in the Western alliance.
Concerns over the impact of Fed's rate rise on housing market
The recent rate rise by the Federal Reserve is causing concerns over its impact on the housing market. Mortgage rates have increased, making it less attractive for potential buyers to purchase homes. Furthermore, the increase in rates may discourage homeowners from selling their properties, leading to a slowdown in the housing market.
Rising gas prices and the failure of economic warfare
Gas prices have been rising due to the failure of economic warfare against Russia. Punitive sanctions and banning Russian oil have resulted in a global price increase, benefiting the Russian economy and causing problems in the supply chain. The West's economic warfare strategy has not achieved its goals of degrading the Russian war machine and punishing ordinary citizens. Additionally, the Ukrainian situation is worsening, with high casualties and a risk of military defeat. The current approach has not worked as intended.
The shortcomings of ESG investing
ESG (Environmental, Social, and Governance) investing has gained popularity, but it has faced criticism for its shortcomings. There are discrepancies in evaluating the environmental and social performance of companies, leading to inconsistency in rankings. ESG funds have seen a decline in investors and are facing scrutiny from regulators. Issues of greenwashing and social washing have also arisen. The SEC is investigating companies and introducing new regulations. A reevaluation of the metrics and criteria used in ESG investing is necessary.
ESG's counterintuitive impact and the need for regulation
ESG investing has resulted in counterintuitive effects, such as companies increasing their ESG scores while their environmental impact worsens. Regulators are cracking down on companies that engage in greenwashing and social washing. The SEC is introducing new regulations to ensure transparency and disclosure of climate change issues. However, an overhaul of the corporate structure and the focus on shareholder maximization is needed to address the limitations of ESG investing.
The need for a new approach to corporate accountability
A new approach to corporate accountability is necessary to address the limitations of ESG investing. Separate entities that measure and evaluate corporate performance based on core impacts, such as air and water quality, need to be created. Corporate motivations for maximizing shareholder returns clash with social and environmental impacts, making it essential to measure performance from an independent perspective. This would require utilizing data analytics and artificial intelligence to measure the impact of corporations on society and the environment.
Krystal and Saagar talk about the GOP primaries, midterm polls, Federal Reserve interest rate raise, Ukraine war strategy, journalist polling, media elitism, Breaking Points profile, war sanction failure, Biden's lack of imagination, and the scam of ESG investing!
