Superinvesting in a Greenhouse
Our goal is to make money on money we’ve already made, so we can make money on that money to make more money on money in the future. According to the magic of compound interest, serious gains from this start kicking in at around the thirty-year mark.
The long-term is a long time, though, and the world will be reinvented over and over again during the course of an investor’s full career. Once upon a time, market players didn’t bat an eyelid over investments in gas-guzzling fossil fuel-firing industrial corps. Now, you daren’t touch such ‘sin stocks!’
Inevitably, some compounders have knowingly or unknowingly built their fortunes in areas the world has since decided aren’t cool. According to a recent study by BloombergGreen, here’s the podium of Superinvestors and billionaires that won’t be on Greta’s Christmas card list!
The Koch Family – $150 Billion
Only eight percent of the Invstr community said it wanted the Koch brothers’ 80-year-old chemical conglomerate to list on a stock exchange. It’s not hard to see why.
Images of Charles Koch posing powerfully next to his oil refineries and pipelines now sum up a sooty past. Younger blood in the family would rather forget those times and is diversifying Koch Industries’ operations. Carbon dioxide emissions have fallen 10% in the last four years, for example. Change is afoot!
The House of Saud – $100 Billion
OPEC’s most avid oil driller is Saudi monarch, King Salmon, with his state-backed oil behemoth and personal plaything, Saudi Aramco. It’s the world’s most profitable company, and also the world’s most valuable following an initial public offering in December. Most believe the only way to stop King Salmon is by disrupting and innovating in his end-markets to be more renewable-compliant. There’s some way to go!
Warren Buffett – $89 Billion
Really? The Oracle of Omaha? Our humble neighborhood billionaire famous for his shrift and wisdom? Sorry Buffheads, but the most successful investor of all time made a hefty mid-2000s play on a freight railroad called Burlington Northern and Santa Fe (BNSF).
Hauling coal and running on coal, the stock pick has blown up Buffett’s carbon footprint, not helped either by owning Berkshire Hathaway Energy. That outfit is responsible for 189 million tons of greenhouse gasses every year.
If there’s any consolation, Warren Buffett’s philanthropy may have offset his annual emissions somewhat. He’s made to answer difficult questions at the iconic Berkshire Hathaway annual meeting (a must-watch!), and he’s also promised his Iowa customers renewable energy next year. Times have changed. It’s simply not shrewd to be on crude!