A feature in the NYT Magazine offers a fascinating new way of looking at Jeremy Grantham. More than the head of asset-management giant GMO, this man should be recognised as the world’s greatest environmentalist.
Grantham tells Carlo Rotella: “The rather burdensome thought is that people won’t listen to environmentalists, but they will sometimes listen to people like me.”
A lot of investors would like you to believe that they are first and foremost an advocate. (See a guide to the charity donations of Wall Street’s richest people >) Why this claim rings true with Grantham, aside from the fact that he supposedly gives most of his money to the Grantham Foundation for the Protection of the Environment, is that his ideals match up perfectly with his investments.
Grantham’s investment letters warn of exploding commodity prices that will just get higher as history progresses. He says energy “will give us serious and sustained problems” over the next 50 years, but peak everything else will give us even more troubles, and we’ll only survive through reduce, reuse, recycle. Water shortages will cause “persistent irritation” in the form of famine and war. Potassium and phosphate depletion are a huge threat, and soil erosion is the biggest danger of all.
A cynic might argue that Grantham would profit from his disaster scenario coming true, but we can’t believe anyone wants the apocalypse.
Recasting global warming as an economic issue may just get America’s attention:
Having missed a once-in-a-generation legislative opportunity to address climate change, American environmentalists are looking for new strategies. Grantham believes that the best approach may be to recast global warming, which depresses crop yields and worsens soil erosion, as a factor contributing to resource depletion. “People are naturally much more responsive to finite resources than they are to climate change,” he said. “Global warming is bad news. Finite resources is investment advice.” He believes this shift in emphasis plays to Americans’ strength. “Americans are just about the worst at dealing with long-term problems, down there with Uzbekistan,” he said, “but they respond to a market signal better than almost anyone. They roll the dice bigger and quicker than most.