SERVING THE QUANTITATIVE FINANCE COMMUNITY

 
User avatar
Kzoo
Topic Author
Posts: 26
Joined: January 9th, 2007, 3:34 am

'Carbon' Job Market Poised For U.S. Takeoff

August 8th, 2007, 2:17 pm

'Carbon' Job Market Poised For U.S. TakeoffCan someone please comment on the expected growth in this area?How many traders will a bank hire for this?If one has experience managing development projects for a U.S. corporation involving energy credits and is familar with how this industry is evolving, can they really get hired as a trader in this area with no trading experience?
 
User avatar
DominicConnor
Posts: 11684
Joined: July 14th, 2002, 3:00 am

'Carbon' Job Market Poised For U.S. Takeoff

August 8th, 2007, 3:02 pm

The existing market seems to be largely in London, so a US market will take a while to get going to a useful level.Cited article sees this as big as Credit, which I must say sounds a bit over the top, and also the regulatory climate in the USA ain't great.As for getting a job as a "trader", that will be much harder than the article implies. However, being part of the trading team is certainly viable, and that can well lead to running your own positions.You might want to research the difference between a "trader" and a "broker". This will inevitably be a relatively illiquid market, and so brokering deals, and convincing clients to take up the structured products will certainly be a big part of tghe business for years to come.Perhaps a path as a sales trader is for you.It may well be that you have the skills to help a bank work out which financial products clients will find valuable enough to buy, and help in their structure and design.The Creationists running the USA will inevitably use it to prop up dinosaur industries like the big car makers. They will get more credits than they actually will end up consuming, but they also have big pension fund liabilities.Can these cash flows be joined ?Someone will get the answer right, and in detail, making a useful pot of money.Indeed, across all industries I'd bet money that the US government gives out so many credits that the market is glutted. A good exercise will be to try and work out how you as someone working for a bank could protect the value of these credits for a corporate client of the bank.
 
User avatar
Kzoo
Topic Author
Posts: 26
Joined: January 9th, 2007, 3:34 am

'Carbon' Job Market Poised For U.S. Takeoff

August 9th, 2007, 1:47 am

Thanks for your thoughts DCFC. I think you are onto something about U.S. companies making lots of money trading their credits.It is annoying that irrelevant U.S. politicians are so stupid to create so much unecessary regulation (good for London).To say it can't get huge seems pessimistic since wars occur over energy. And, since being "Green" is gaining so momentum in corporate America, growth will accelerate rapidly.I guess I'll have to keep my eyes and ears open for these sorts or positions. So I take it that you are not really seeing or hearing about many of these opportunities in the U.S.?
 
User avatar
EnergyQuant
Posts: 167
Joined: July 18th, 2002, 4:34 pm

'Carbon' Job Market Poised For U.S. Takeoff

August 9th, 2007, 6:05 am

QuoteOriginally posted by: KzooIt is annoying that irrelevant U.S. politicians are so stupid to create so much unecessary regulation (good for London).To say it can't get huge seems pessimistic since wars occur over energy. And, since being "Green" is gaining so momentum in corporate America, growth will accelerate rapidly.I guess I'll have to keep my eyes and ears open for these sorts or positions. So I take it that you are not really seeing or hearing about many of these opportunities in the U.S.?OK, I can't resist1) Ever heard of the EU? I think they would give the US Congress a pretty good run for their money on "unecessary regulation"2) "Green" is gaining so much momentum in corporate America - sorry, but I think you are going to have to back that one up. I work in the energy industry, so I'll give you one example - "green" power (100% covered by renewables like wind) has a take up rate of about 10% among residential customers. It has a take up rate of about 1% among corporates. An important point - corporations are amoral - they don't care about right or wrong, they just maximise profits.3) Carbon is a crock. Let's say, as President, you spend trillions on the "Carbon Wars" and reduce the Carbon footprint of the USA by 20%. Taxes go up, the economy goes south, and - oh, look, the weather is the same or 0.5 degrees cooler at the end of your term. Guess how long it's going to be before your party is back in power again? Dumb politics - there are more votes in subsidising stupid ideas like ethanol than there are in promoting carbon trading schemes that actually cap carbon emissions.EQ
 
User avatar
DominicConnor
Posts: 11684
Joined: July 14th, 2002, 3:00 am

'Carbon' Job Market Poised For U.S. Takeoff

August 9th, 2007, 7:39 am

1) Yes, the EU is a worthy competitor for the US government. Only good thing is it has far less power to do harm with.2) Energyquuant, although those numbers are small they come from a very low base, the growth is not that poor.Also, it is plausible to take a bet that marginally less Creationists politicians will come into power in the next couple of years, and there may be a sudden jump.3) Carbon may well be a crock, I note that methane emissions don't get wide eyed coverage 1/10th as much, and it is inconceivable that the American Creationists, or the kleptocrats in the EU will do anything to annoy farmers.biofuels make disposing of nuclear waste in normal landfill look rational.I think both EU and Creationist politicians will quickly realise that Carbon is a smart way of puttting up trade barriers.French anti-US politicians will use it against the US, E.European anti-Russian ones against Russia, anti-Chinese politicians in the USA can of course go for a "carbon import tax".It is of course the case that in a world with complete rationality and intelligence, many in financial markets wouldn't be able to make a living.There is certainly money to be made in the short term, from this large activity, regardless of your model of what you think about the long term underlying value.I personally think that Carbon pricing of some form is inevitable, and that it will be traded.I also believe it will suffer from some of the problems that the physical commodity markets went through as they formed.There is a quality issue in physical delivery, that will be exploited by poeple of variable ethical positions.Although it's pretty trivial to work out the carbon that comes out of a process in most cases, already we are seeing scams where "carbon reduction" processes vary from over-optimism, exaggeration through to fraudulent non-existence. But all the complexities I cite (and more) possibly make it more plausible for a career for kzoo.His expertise in the energy business means that he can help navigate through this mess in a way that he could not with other derivatives.
 
User avatar
ppauper
Posts: 70239
Joined: November 15th, 2001, 1:29 pm

'Carbon' Job Market Poised For U.S. Takeoff

August 9th, 2007, 1:08 pm

QuoteOriginally posted by: EnergyQuant3) Carbon is a crock. Let's say, as President, you spend trillions on the "Carbon Wars" and reduce the Carbon footprint of the USA by 20%. Taxes go up, the economy goes south, and - oh, look, the weather is the same or 0.5 degrees cooler at the end of your term. Guess how long it's going to be before your party is back in power again?lol, that's exactly right (except the 0.5 degrees is probably too much ! more like 0.1 degrees)
 
User avatar
DominicConnor
Posts: 11684
Joined: July 14th, 2002, 3:00 am

'Carbon' Job Market Poised For U.S. Takeoff

August 9th, 2007, 3:19 pm

I think it's wrong to assume that carbon taxes necessarily mean that averages taxes go up.If the USA moved to the same regime on fuel taxes found in most European countries it could abolish many federal taxes altogether.You could move income tax from being paid by most earners to one that (about) only 10-15% paid.If the USA applied carbon taxes to countries without such a regime, and applied a general tax of (say) 15% to all carbon fuels, then you might just be able to abolish federal income tax altogether.I don't believe for one second this will happen, but wouldn't it be one hell of a platform for al Gore to run on ?"No income tax, and you get to save the planet !!!"Certainly more attractive than the Creationists denial of objective reality in Iraq and the atmosphere.
 
User avatar
ppauper
Posts: 70239
Joined: November 15th, 2001, 1:29 pm

'Carbon' Job Market Poised For U.S. Takeoff

August 10th, 2007, 12:29 pm

QuoteOriginally posted by: DCFCI think it's wrong to assume that carbon taxes necessarily mean that averages taxes go up.If the USA moved to the same regime on fuel taxes found in most European countries it could abolish many federal taxes altogether.You could move income tax from being paid by most earners to one that (about) only 10-15% paid.it just seems to happen that when new taxes are increased, the old ones don't go down......
 
User avatar
DominicConnor
Posts: 11684
Joined: July 14th, 2002, 3:00 am

'Carbon' Job Market Poised For U.S. Takeoff

August 11th, 2007, 6:42 am

Your cynicism is of course is justified.
 
User avatar
ppauper
Posts: 70239
Joined: November 15th, 2001, 1:29 pm

'Carbon' Job Market Poised For U.S. Takeoff

August 11th, 2007, 1:03 pm

QuoteOriginally posted by: DCFCCertainly more attractive than the Creationists denial of objective reality in Iraq and the atmosphere.I don't know what goes through your head when you say things like this.The invasion of Iraq was led by the neo-cons with the blessing of socialists like Hillary Clinton.The old right, the paleoconservatives, were pretty much opposed to it. The paleoconservative foreign policy is predicated on the view of the founding fathers as expressed by John Quincy Adams that America "goes not abroad, in search of monsters to destroy"as for "objective reality in....the atmosphere", there is no consensus amongst scientists as to what that reality is
 
User avatar
ppauper
Posts: 70239
Joined: November 15th, 2001, 1:29 pm

'Carbon' Job Market Poised For U.S. Takeoff

August 11th, 2007, 1:06 pm

as for existing carbon trading schemesA Financial Times investigation has uncovered widespread failings in the new markets for greenhouse gases, suggesting some organisations are paying for emissions reductions that do not take place.
 
User avatar
DominicConnor
Posts: 11684
Joined: July 14th, 2002, 3:00 am

'Carbon' Job Market Poised For U.S. Takeoff

August 11th, 2007, 3:34 pm

By "Creationist" I was not referring to Bush and his people, but American politicians in general.As te Economist put it this week "Mrs Clinton might be portrayed as a communist on talk radio in Kansas, but set her alongside France's Nicolas Sarkozy, Germany's Angela Merkel, Britain's David Cameron or any other supposed European conservative, and on virtually every significant issue Mrs Clinton is the more right-wing. She also mentions God more often than the average European bishop."I accept that there is doubt about what is happening in the climate.I am not critical of this doubt, but the low quality of it.As I recall half the Republican candidates have come out in favour of Creationism.Outside the USA that would get you laughed out of running for any office, except maybe in Iran.
 
User avatar
bogracer
Posts: 94
Joined: February 7th, 2005, 5:35 pm

'Carbon' Job Market Poised For U.S. Takeoff

August 13th, 2007, 6:11 am

Still can't believe the UK has Darwin on its money. Good job.
 
User avatar
TraderJoe
Posts: 11048
Joined: February 1st, 2005, 11:21 pm

'Carbon' Job Market Poised For U.S. Takeoff

August 13th, 2007, 7:50 pm

QuoteOriginally posted by: ppauperQuoteOriginally posted by: DCFCCertainly more attractive than the Creationists denial of objective reality in Iraq and the atmosphere.I don't know what goes through your head when you say things like this.The invasion of Iraq was led by the neo-cons with the blessing of socialists like Hillary Clinton.The old right, the paleoconservatives, were pretty much opposed to it. The paleoconservative foreign policy is predicated on the view of the founding fathers as expressed by John Quincy Adams that America "goes not abroad, in search of monsters to destroy"What if I nuke you?Dumbass.
Last edited by TraderJoe on August 12th, 2007, 10:00 pm, edited 1 time in total.
 
User avatar
TraderJoe
Posts: 11048
Joined: February 1st, 2005, 11:21 pm

'Carbon' Job Market Poised For U.S. Takeoff

August 13th, 2007, 7:53 pm

QuoteOriginally posted by: ppauperas for existing carbon trading schemesA Financial Times investigation has uncovered widespread failings in the new markets for greenhouse gases, suggesting some organisations are paying for emissions reductions that do not take place.Oooooohhh, dishonesty and greed in the financial markets, now there's a novel idea!
ABOUT WILMOTT

PW by JB

Wilmott.com has been "Serving the Quantitative Finance Community" since 2001. Continued...


Twitter LinkedIn Instagram

JOBS BOARD

JOBS BOARD

Looking for a quant job, risk, algo trading,...? Browse jobs here...


GZIP: On