Update - September 20, 2022

What Did This Company Just Announce?!

You don’t subscribe to Manward Letter to hear what others are talking about.

Yes, the Fed has a meeting this week. Yes, it will likely have a critically important outcome that will move markets (likely higher… at least temporarily). And yes, every financial outlet on the planet will cover it.

We don’t need to add to the droning.

There’s something else I want you to focus on today… a real moneymaking opportunity.

It has to do with an idea I first introduced to you in May of last year. That’s when I wrote, “One of the worst things to ever happen to this country is Al Gore.”

Some readers probably quit right there.

But those who didn’t – those who opened their eyes to the nuanced idea behind those words – learned about one of the most important and perhaps most lucrative investment innovations of our time.

I dove into the subject of carbon credits – a nascent, little-understood corner of the market with some tremendous promise.

In the issue (you can read it here), I wrote about a blockchain-based carbon credit known as Universal Carbon, or UPCO2.

Admittedly, the space hasn’t gotten much attention in the months since. The opportunity I told you about has largely stayed flat – a big win in a market that’s seen the value of just about everything fall.

But the tide is turning.

In a move that’s not getting much press in this news-rich week, the folks at Salesforce (CRM) just announced that they are investing heavily in the space.

The software company plans to launch a carbon credit trading platform called Net Zero Marketplace next month. More than 90 projects will be featured on the new exchange.

With the introduction of huge green energy subsidies in the recently passed Inflation Reduction Act (please don’t get me started on the gross fraud in the name), the sector is back in the spotlight. In fact, some estimates have the carbon credit market surging from near zero today to more than $50 billion by 2030.

It’s a huge opportunity.

Salesforce may not be the first company we think of when it comes to carbon credits, but clearly the innovative first mover sees what’s happening.

“The immaturity of the carbon marketplace is what is hindering action,” said Patrick Flynn, Salesforce’s global head of sustainability. “There’s not a lot of trust, there’s not a lot of transparency. Buyers are afraid of making a mistake. Suppliers can’t connect with enough buyers.”

If you’re not familiar with how carbon credits work, they’re pretty simple. Folks who are able to sequester excess carbon (through either farming or other industrial practices) earn carbon credits.

Folks who pollute heavily need those credits to offset the amount of carbon they put in the air.

It creates a clear system of supply and demand… and an ideal setup for a transparent exchange.

Salesforce isn’t new to the game. It has offered software for several years now that allows its countless customers to track their emissions. This new exchange will be a natural offering to those folks.

The company isn’t in our portfolio, and this move will have a minimal effect on Salesforce’s top and bottom lines… but it proves the idea I wrote so passionately about last year has merit. All this climate change stuff has a time and a place… but the government won’t solve anything. It never does.

We must let the free market reign.

That’s why this is good news. Keep an eye on the price of Universal Carbon over the next few months. It’s likely to have some legs.

Over in the traditional stock market, volatility remains the theme of the year. Investors are jockeying ahead of the Fed’s announcement tomorrow, working to price in hawkish action from European central banks.

I’ll dive into the Fed’s meeting and report anything that the headline writers miss.