Weekend Reading - sept 28 2012

I’ve got a bunch of news stories (8 to be exact) and few academic papers for your weekend reading. Enjoy!


First, here’s your news:

- What’s new at Ireland’s National Pension reserve Fund, you ask? Well, pretty much everything. It’s gone from a global portfolio investor to a local economic stimulator.

- And with all of the changes at the NPRF, perhaps it’s not all that surprising it was swindled by transition managers.

- Australia’s Future Fund is doing more in the direct infrastructure space; it will reportedly join a bid for NSW’s Port Botany.

- If you don’t mind reading about things that in all likelihood won’t happen, here’s an article on some upcoming changes to China’s three main sovereign funds.


- The drop in global commodity prices apparently hurt the China Investment Corporation’s international portfolio last year, though the fund’s five-year returns remain strong.

- It appears that Slovenian lawmakers “...probably will approve the creation of a sovereign-wealth fund”.

- Kazakhstan’s sovereign fund Samruk-Kazyna received a $1 billion dividend in 2011 from KazMunaiGaz.

- To my fellow Albertans: How do you want to use the Heritage Fund? Vote now! Seriously, right now... It’s online.

Second, here are two papers that offer insights into the business of “long-term investing”. Both are focused on “green” and “clean”, which means they consider mechanisms for assessing long-term risk in present day decision-making:

- Georg Inderst, Christopher Kaminker and Fiona Stewart of the OECD have a new paper entitled “Defining and Measuring Green Investments: Implications for Institutional Investors”. It’s quite an interesting read, as it provides “... a comprehensive review of the concepts and definitions related to “green” investments that are currently used in the market place.” In other words, it’s a very useful primer to get you up to speed on the topic.

- Ken Berlin, Reed Hundt, Mark Muro, and Devashree Saha of Brookings have a new paper entitled “State Clean Energy Finance Banks: New Investment Facilities for Clean Energy Deployment”. It offers a look into some of the challenges associated with clean energy innovation and overcoming the ‘valley of death’ financing problems. As the authors note,“..the proposed new finance entities entail the creation by states of dedicated clean energy banks that leverage public money with private sector funds and expertise... With numerous federal programs and policies set to expire and states still struggling with serious budget challenges, direct government grants and tax credits are not going to be as available as they have been to drive the shift to a low-carbon future. Instead, both public and private investment is going to have to be leveraged more smartly.” It’s quite an interesting read.

Enjoy your weekend!