Carbon is the new Gold

Some of you may be old enough to remember the Gold Standard. I'm not, but yesterday a comment from a reader got me thinking.

It's becoming increasingly apparent to me that future energy policy - and indeed the total solution to regulating carbon emissions - will require a global emissions trading scheme.

I'm sure I'm not the first person to have noticed that trading carbon emissions is much like trading any other commodity. You need a market, a mechanism for establishing futures, a means of setting interests rates and prices. Carbon savings now are worth more than carbon savings in the future - and so on. Hmmmm... now where have we seen all that before?

But two things make carbon emissions different: they are a truly global commodity and the total emissions worldwide have to be tightly regulated - in fact, much like the way a Central Bank regulates a currency. Carbon emissions will have a monetary value - the same the world over, so how long before the value of our currencies is defined against the Carbon Standard?

If there are any money men reading this, give me a call....