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EXCLUSIVE Lawyers warn EU against labelling gas as a 'green' investment – Reuters

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Storage tanks are seen at an (LNG) facility at Waterston, Milford Haven, Pembrokeshire, Wales, Britain, September 20, 2021. REUTERS/Rebecca Naden/File Photo

  • ClientEarth says move would breach several EU laws
  • Brussels decision on gas in ‘taxonomy’ due this year

BRUSSELS, Oct 7 (Reuters) – The environmental law firm ClientEarth has warned the European Union that it would be breaching its own laws if it labels investments in gas-fuelled energy as “green” in upcoming finance regulations.

In a Wednesday letter to the bloc’s executive seen by Reuters, ClientEarth said categorising gas as environmentally friendly would violate other laws, including the EU’s legally binding target to reduce its net greenhouse gas emissions by at least 55% by 2030 from 1990 levels, and bring them to zero by 2050.

The EU is close to finishing the climate portion of its sustainable finance taxonomy, a first-of-its-kind regulation that aims to steer private capital out of polluting economic activities and into those the EU deems environmentally friendly.

The European Commission is expected to make a decision in the coming months on whether the climate taxonomy, the bulk of which it proposed rules for earlier this year, will label natural gas and nuclear energy as green investments.

“If it were adopted, this is likely to increase investments in activities utilising natural gas and would be in total contradiction with the commitments undertaken by the European Commission both at international and EU level,” ClientEarth said in the letter.

A European Commission official said it had received the letter and would respond “in due time”.

ClientEarth said legislation that supported funding for gas would divert money that could otherwise be spent on renewable energy. The taxonomy would not block investors from putting money into gas projects, but it would ban them from labelling such investments as sustainable.

The lawyers added gas also fails to meet a key plank of the taxonomy regulation, which states that to be deemed climate friendly investments must “contribute substantially to the stabilisation of greenhouse gas emissions at a level that prevents dangerous anthropogenic climate change.”

While gas is not as polluting as coal, it still produces carbon emissions when burned and is linked to potent methane emissions, both of which must be rapidly reduced to meet the Paris climate goals.

However, some EU countries see gas as a transition fuel and say it should be included in the taxonomy to support investments that would help them phase out coal-fuelled energy.

The disagreement has fuelled extensive lobbying from governments and forced the Commission to delay its decision on gas by almost a year.

Tensions have been stoked further in recent weeks as European gas prices have soared to record high levels, prompting some countries to call for a faster shift away from fossil fuels to reduce exposure to volatile prices.

Reporting by Kate Abnett and Simon Jessop; Editing by Aurora Ellis

Our Standards: The Thomson Reuters Trust Principles.

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Micron Urges Government Investment with R&D Spend – The Next Platform

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Over the last twenty years, memory has risen from 10% of the semiconductor market to almost 30%, a trend that is expected to continue, propelled by compute at the edge all the way up to datacenter. To meet these demands, memory giant, Micron, has announced it will make $150 billion in internal investments, ranging from manufacturing and fab facilities to R&D to support new materials and memory technologies.

The nature of the announcement serves two purposes. The first is obvious, Micron is putting a stake in the ground around its bullish view for edge to datacenter growth and their role as a primary component maker. The second is only slightly less obvious: to compel the U.S. to match funds or continue new investment strategies to support U.S. fabs and semiconductor R&D.

While $150 billion is a sizable investment, the fab component of Micron’s plans will gobble up a significant fraction. While no fab is created equally, consider TSMC’s investments in new facilities, which are upwards of $9 billion. Such investments can take two to three years to yield but the time is certainly right. Gartner, for instance, estimates the costs for leading-edge semiconductor facilities to increase between 7-10%.

While DRAM and NAND are less expensive than leading edge technologies, Micron will need to choose carefully as it sets its plans in motion. Luckily, there is ample government support building in the U.S. for all homegrown semiconductor industry, although it is unclear how federal investments, including the $52 billion CHIPS Act, will augment Micron’s own ambitions.

Micron is seeking the attention of government with its broad R&D and manufacturing investment, pointing to the creation of “tens of thousands” of new jobs and “significant economic growth.” In a statement, Micron explained that memory manufacturing costs are 35-45% higher than in lower-end semiconductor markets, “making funding to support new semiconductor manufacturing capacity and a refundable investment tax credit critical to potential expansion of U.S. manufacturing as part of Micron’s targeted investment.”

“The growth of the data economy is driving increased customer demand for memory and storage,” said Executive Vice President of Global Operations Manish Bhatia. “Leading-edge memory manufacturing at scale requires production of advanced semiconductor technology that is pushing the laws of physics, and our markets demand cost-competitive operations. Sustained government support is essential for Micron to ensure a resilient supply chain and reinforce technology leadership for the long term.”

Micron CEO, Sanjay Mehrotra says the company will “look forward to working with governments around the world, including in the U.S. where CHIPS funding and the FABS Act would open the door to new industry investments, as we consider sites to support future expansion.” The subtext there is that the U.S. is only one country in the running, among others making investments.

Increasing government support will likely align with fabs and facilities but Micron says it’s working on next generation technologies set to keep pace with growing demand.

This is part of the company’s 2030-era plan for memory technology. Micron sees edge and cloud deployments expanding but also points to AI as the leading workload across deployment types. The company’s senior VP and GM for Compute and Networking, former Intel HPC lead, Raj Hazra, says that by 2025, 75% of all organizations will have moved beyond the AI experimentation stage into production.

To support this more practically, Micron has set forth some ambitious near-term targets, including reaching for 40% improvements in memory densities over existing DRAM, double SSD read throughput speeds over current 1TB SSDs, 15% power reductions over existing DRAM and 15% better performance for mixed workloads over existing NAND.

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Walmart allowing some shoppers to buy bitcoin at Coinstar kiosks

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Walmart Inc said on Thursday customers at some of its U.S. stores will be able to purchase bitcoin using ATM-like machines installed by  Coinstar.

Coinstar, known for its machines that can exchange physical coins for cash, has partnered with digital currency exchange CoinMe to let customers buy bitcoin at some of its kiosks.

There are 200 Coinstar kiosks located inside Walmart stores across the United States that will allow customers to buy bitcoin, a Walmart spokesperson said.

Walmart was subject to a cryptocurrency hoax in September when a fake press release was published announcing a partnership between the world’s largest retailer and litecoin. The news had briefly sent prices of the little known cryptocurrency surging.

 

(Reporting by Uday Sampath in Bengaluru; Editing by Devika Syamnath)

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Here’s What Makes Intuit (INTU) A Meaningful Investment – Yahoo Finance

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Cooper Investors, an investment management firm, published its “Cooper Investors Global Equities Fund (Hedged)” third quarter 2021 investor letter – a copy of which can be downloaded here. For the rolling three months to one year, the Fund returned 5.7% and 28.24% respectively, while its benchmark, by comparison, returned -0.42% and 26.57% over the same period. You can take a look at the fund’s top 5 holdings to have an idea about their best picks for 2021.

Cooper Investors, in its Q3 2021 investor letter, mentioned Intuit Inc. (NASDAQ: INTU) and discussed its stance on the firm. Intuit Inc. is a Mountain View, California-based software company with a $156.4 billion market capitalization. INTU delivered a 50.80% return since the beginning of the year, while its 12-month returns are up by 72.12%. The stock closed at $572.80 per share on October 19, 2021.

Here is what Cooper Investors has to say about Intuit Inc. in its Q3 2021 investor letter:

“The other meaningful deal during the quarter was Intuit’s acquisition of Mailchimp for $12bn. Intuit has reinvented itself over the last decade and thrived with a leadership position in QuickBooks Online, the financial accounting software for small businesses (effectively the ‘Xero of the US’). We originally invested in Intuit in February 2020, excited by the QuickBooks prospects.

Management have executed exceptionally well on the opportunity set which has seen the shares double since our initial purchase. However, the company has now conducted two meaningful deals in Mailchimp and Credit Karma worth a combined US$20bn over the last 12 months. The investment proposition has shifted from a focus on QuickBooks to now being a financial and small business software conglomerate. We continue to very much admire the company, but with Intuit now trading on 50x forward earnings we no longer see such attractive latency on offer, nor the rewards for the level of execution risk and thus we have exited the position.”

Software

Software

Based on our calculations, Intuit Inc. (NASDAQ: INTU) was not able to clinch a spot in our list of the 30 Most Popular Stocks Among Hedge Funds. INTU was in 66 hedge fund portfolios at the end of the first half of 2021, compared to 68 funds in the previous quarter. Intuit Inc. (NASDAQ: INTU) delivered an 11.34% return in the past 3 months.

Hedge funds’ reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn’t keep up with the unhedged returns of the market indices. Our research has shown that hedge funds’ small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by 115 percentage points since March 2017 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter.

At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium mining is one of the fastest-growing industries right now, so we are checking out stock pitches like this emerging lithium stock. We go through lists like the 10 best EV stocks to pick the next Tesla that will deliver a 10x return. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our homepage.

Disclosure: None. This article is originally published at Insider Monkey.

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