Eye on the Market

Pascal’s Wager

by Michael Cembalest
Chairman of Market and Investment Strategy

Pascal’s Wager argues that belief makes more sense than disbelief when the worst outcome is a total loss. If so, supporting renewable energy makes sense even without knowing the true impact of greenhouse gas emissions on sea levels. However, energy transitions are gradual rather than sudden, defying the expectations of futurists.

This year, we examine some timely examples: why climate goals can’t be reached by simply decarbonizing electricity with wind and solar power; why natural gas will still be the fuel of the 21st century; the wide range of electric vehicle forecasts after last decade’s misfire; the high voltage transmission bottleneck in the United States; and how a group of researchers thoroughly dismantled Mark Jacobson’s highly publicized vision of a grid based 100% on renewable energy. As a result, we also look at sea level rise, coastal exposures and flood mitigation infrastructure, which might be needed just in case. We conclude with the intersection between food, energy, urbanization and proposed changes to the U.S. Electoral College.

To learn more about these topics, read the full Eye on the Market: 2018 Energy Paper or listen to the latest episode of Michael Cembalest’s new podcast below. Additionally, for ideas on how to incorporate these views into your portfolio in a way that is suitable for you, we invite you to contact your J.P. Morgan advisor.

The J.P. Morgan Eye on the Market Podcast—a new way to engage with Michael Cembalest

Join Michael Cembalest as he explores a wide variety of investment topics, including the economy, policy and markets. Your subscription will feature new episodes with the release of each Eye on the Market publication. Subscribe today using your preferred podcast provider.

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