The biggest risk/correlation to equity markets over the next decade has nothing to do with interest rates.

It will be carbon tariffs and it will blow up every DCF model of every company in the public markets...

Imagine a new trade war between the US and China. Or imagine an increasingly aggressive European Union fighting climate change.

The simplest solution to enact both would be a carbon tariff.

A carbon tariff would require every company to have a detailed provenance of the energy used to produce a good or service entering a border.

Love that iPhone case? It's price will depend on how much coal was burned in China to make it. More coal == more tariff == more cost.

Companies aren't prepared for this. Capital markets have no sense of it. Yet climate legislation marches forward.

We are supporters of carbon tariffs and want to help build solutions. Meanwhile, we update our models...