Is Climate Finance the Next Bubble? by Arvind Subramanian

While the conventional wisdom is that the next financial crash will come from the collapse of the cryptocurrency bubble, climate finance may pose a more serious risk. Mounting evidence suggests that green lending is displaying all the pathologies associated with financial manias.

PROVIDENCE – In the last few years, and especially after the recent United Nations Climate Change Conference (COP26) in Glasgow, private investors have seen an opportunity to midwife developing countries’ bumpy transition to net-zero carbon-dioxide emissions. After all, if BlackRock CEO Larry Fink and the climate activist Greta Thunberg can find common cause, then the tantalizing prospect held out by William Blake – “Great things are done when men and mountains meet” – comes into view.

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