UBC to hold Referendum on divestment of holdings in fossil fuel assets

[TimG]

You have seen the evidence from financial advisors that investing in companies other than fossil fuel companies produce the same or better returns than fossel fuel companies.

If other investments produce better returns then managers should be pursuing them. This is most likely dubious propaganda created by the ideologues pushing for "divestment"

And in the meantime, if they can get better returns and encourage companies to invest in alternative energy solutions, why not?

Because the chances of "alternative energy" producing better returns in the real world are next to zero. This is purely a move driven by ideology and no institution which expects bailouts from taxpayers should be making investment decisions based on ideology. Edited December 13, 2014 by TimG

[WestCoastRunner]

If other investments produce better returns then managers should be pursuing them. This is most likely dubious propaganda created by the ideologues pushing for "divestment"

Because the chances of "alternative energy" producing better returns in the real world are next to zero. This is purely a move driven by ideology and no institution which expects bailouts from taxpayers should be making investment decisions based on ideology.

You are missing the point. This move is to encourage investment in R&D of greener technology.

[Wilber]

You have seen the evidence from financial advisors that investing in companies other than fossil fuel companies produce the same or better returns than fossel fuel companies.

You are just spouting off without investing any energy on your part to see if it's a good thing. Again, I repeat, why the backlash. You say it's for ideological reasons. But why not? And in the meantime, if they can get better returns and encourage companies to invest in alternative energy solutions, why not? You have not provided a good reason for them not to divest of these investments.

Actually I haven't seen the evidence. According to the link it looks like the Bloomberg study that was quoted only looked at the index with and without energy stocks and ignored income which is a very important part of investing, particularly if you are relying on investments to provide income.

[bush_cheney2004]

Actually I haven't seen the evidence.

Neither have I. I invested about $15,000 in a hydrogen fuel cell company in Canada (Hydrogenics, Mississauga, ON). That was back in 2006....they have yet to turn a profit. Great technology, business is growing, but no profits because of higher costs. Good thing I bailed on the stock in 2008.

[WestCoastRunner]

Actually I haven't seen the evidence. According to the link it looks like the Bloomberg study that was quoted only looked at the index with and without energy stocks and ignored income which is a very important part of investing, particularly if you are relying on investments to provide income.

If you are relying on an investment to provide income and it is not providing the income you desire, then you have chosen a piss poor investment advisor or financial planner. This goes back to investing without financial advice. You need to choose investments that provide those dividend payments (especially with the oil industry taking a huge dive!) and for everyone it is different, depending on the stage in their life.

Honestly, this goes back to you folks more determined to prove that you are right, rather than looking forward to other energy supplies. I am not here to argue with you about that. I am onside to increasing R&D on other alternatives to energy. I really don't get the backlash to organizations choosing to take the initiative to encourage alternative sources of energy to save our planet. If you can explain to me why we should be encouraging investment in fossil fuel explorations, then please, do so.

[bush_cheney2004]

Fossil fuel companies already invest in lots of R&D for all kinds of energy technologies and services. There is nothing special about renewables in that regard. They are not mutually exclusive, but rather quite complimentary.

[TimG]

You are missing the point. This move is to encourage investment in R&D of greener technology.

No. The point is to piss away money saved for UBC on projects that meet arbitrary 'flavour-of-the-week' criteria set by ideologues. This would be fine if it was purely private money but its not - UBC is a public institution and expects taxpayer bailouts if it makes bad investment decisions which means it has no business making investment decisions based on ideology.

[Wilber]

If you are relying on an investment to provide income and it is not providing the income you desire, then you have chosen a piss poor investment advisor or financial planner. This goes back to investing without financial advice. You need to choose investments that provide those dividend payments (especially with the oil industry taking a huge dive!) and for everyone it is different, depending on the stage in their life.

Honestly, this goes back to you folks more determined to prove that you are right, rather than looking forward to other energy supplies. I am not here to argue with you about that. I am onside to increasing R&D on other alternatives to energy. I really don't get the backlash to organizations choosing to take the initiative to encourage alternative sources of energy to save our planet. If you can explain to me why we should be encouraging investment in fossil fuel explorations, then please, do so.

Energy stocks are providing a very good income and at todays prices, their dividends are even more attractive. Even if they have to cut dividends they will likely still pay much better than GIC's. How many green energy stocks are paying any dividends at all? If you are depending entirely on capital gain to provide income you have a piss poor financial advisor.

What exactly are the proponents of this scheme doing if it isn't trying to prove they are right in order to promote an ideology using other people's money. An endowment fund's purpose is to provide income for the university, not promote the ideology of its faculty.

Edited December 13, 2014 by Wilber

[overthere]

Honestly, this goes back to you folks more determined to prove that you are right, rather than looking forward to other energy supplies. I am not here to argue with you about that. I am onside to increasing R&D on other alternatives to energy. I really don't get the backlash to organizations choosing to take the initiative to encourage alternative sources of energy to save our planet.

Honestly, I am convinced you do not understand the priority of completely reliable, consistent, affordable for the ordinary citizen, and the primacy ofplentiful electricity in a modernized industrial society. It's what allows us to live in this country.

I have no problem at all with alternative energy sources as long as they address and recognize that priority.

[WestCoastRunner]

Energy stocks are providing a very good income and at todays prices, their dividends are even more attractive. Even if they have to cut dividends they will likely still pay much better than GIC's. How many green energy stocks are paying any dividends at all? If you are depending entirely on capital gain to provide income you have a piss poor financial advisor.

What exactly are the proponents of this scheme doing if it isn't trying to prove they are right in order to promote an ideology using other people's money. An endowment fund's purpose is to provide income for the university, not promote the ideology of its faculty.

Who says they are investing in GIC's? Give me a break. As has been mentioned in previous posts, returns can be better than or equal to portfolios that hold energy stocks. As long as they are making money, who cares where they invest their money (isn't that what you folks are saying?. If they can make money in stocks other than fossil fuel companies, I say, 'go for it'!

[WestCoastRunner]

Honestly, I am convinced you do not understand the priority of completely reliable, consistent, affordable for the ordinary citizen, and the primacy ofplentiful electricity in a modernized industrial society. It's what allows us to live in this country.

Honestly, I get tired of your condescending remarks.

[WestCoastRunner]

This is purely a move driven by ideology and no institution which expects bailouts from taxpayers should be making investment decisions based on ideology.

Who says they are expecting bailouts. As has been mentioned earlier, they have professional, financial advice as to alternative investments that have the same returns or better than the holdings they now have.

[Wilber]

Who says they are investing in GIC's? Give me a break. As has been mentioned in previous posts, returns can be better than or equal to portfolios that hold energy stocks. As long as they are making money, who cares where they invest their money (isn't that what you folks are saying?. If they can make money in stocks other than fossil fuel companies, I say, 'go for it'!

The Bloomberg study was quoted as saying if you compared the regular index with a fossil fuel free index, there was little or no difference. I actually believe that but the index only looks at capital gains, it doesn't include a stock's earnings.

I'll give you an example I posted on another thread. It is simplistic but illustrates a point. You buy 100 shares of two different stocks that cost $100 per share and hold them for 10 years. Stock A pays no dividend and stock B pays a 4% dividend. After ten years stock A is valued at $140 and stock B is still worth the $100 you paid for it. If you just look at the index, stock B is a complete dog compared to stock A, but is it.? You have had no income from stock A for ten years and in order to get your $40 profit, you have to sell the share and pay tax on the whole amount in that tax year. Stock B has been paying you the same amount spread over ten years. Your tax bill has been spread out over that ten years, you have made the same amount of money and still own the stock.

I don't know how endowment funds are taxed if at all, so lets say they they aren't. If you had not spent the income from stock B and kept reinvesting it in the same stock, after ten years you would now have over 140 shares paying you 4%.

Like you say, it depends on where you are in life. I think endowment funds are like retirees, trying to maximize income with the minimum amount of risk. That means a limited but necessary exposure to high quality companies that pay you to own their shares. If they can find such companies in the green energy sector, by all means invest in them. Otherwise, they are gambling with other peoples money.

Investing is a little more involved than just looking at indexes.

Edited December 14, 2014 by Wilber

[WestCoastRunner]

Here is an excellent explanation of the Divestment:

"Divestment can be effective because it can undercut the economic and especially the

political power of the fossil fuel industry, whose aggressive lobbying against necessary

policy reforms has thwarted meaningful action on climate. Inspired by the anti-apartheid

movement, the fossil fuel divestment movement aims to stigmatize the fossil fuel

industry and delegitimize its political influence. Divestment create can help create

political space for policymakers to adopt meaningful policies to foster a rapid transition

to a clean energy future."

No one here has shown that divesting of fossil fuel companies will harm their portfolio.

[Wilber]

Here is an excellent explanation of the Divestment:

"Divestment can be effective because it can undercut the economic and especially the

political power of the fossil fuel industry, whose aggressive lobbying against necessary

policy reforms has thwarted meaningful action on climate. Inspired by the anti-apartheid

movement, the fossil fuel divestment movement aims to stigmatize the fossil fuel

industry and delegitimize its political influence. Divestment create can help create

political space for policymakers to adopt meaningful policies to foster a rapid transition

to a clean energy future."

No one here has shown that divesting of fossil fuel companies will harm their portfolio.

Divestment is not investment.

[WestCoastRunner]

Divestment is not investment.

Um, yea, I get that. I did hold a securities license for sometime.

Edited December 14, 2014 by WestCoastRunner

[Wilber]

Um, yea, I get that. I did hold a securities license for sometime.

Well, I think it is up to the people proposing this to build a portfolio that makes their case, not up to others to show that it doesn't.

[WestCoastRunner]

Well, I think it is up to the people proposing this to build a portfolio that makes their case, not up to others to show that it doesn't.

And I am confident they will, but let's not tie their hands behind their back before they can demonstrate this.

Edited December 14, 2014 by WestCoastRunner

[Wilber]

And I am confident they will, but let's not tie their hands behind their back before they can demonstrate this.

They haven't demonstrated anything, they are just demanding divestment.

[WestCoastRunner]

They haven't demonstrated anything, they are just demanding divestment.

They have consulted with professional investment advisors. They are not blindly entering into this endeavour.

[Wilber]

They have consulted with professional investment advisors. They are not blindly entering into this endeavour.

Really, all they have referred to is a simplistic comparison of an index with and without fossil fuel shares. Might as well stick it all in a fossil fuel free ETF. Doesn't sound very professional to me.

[TimG]

Who says they are expecting bailouts. As has been mentioned earlier, they have professional, financial advice as to alternative investments that have the same returns or better than the holdings they now have.

If that was the case there would be no need for a discussion of 'divestment' - they would just do it. You know that such talk is simply propaganda designed to trick people in the voting for this hair brained notion.

IOW - don't give me crap about 'advice of professionals' while you are pushing a policy that ties the hands of the professionals. If you believe what you say then why don't you just say that there is absolutely no need for 'divestment' since it will happen anyways because it is 'good business'? Bet you won't do that because you know it is a bad business decision no matter what propaganda you spout.