This is an audio transcript of the FT News Briefing podcast episode: Introducing: the FT Climate Game
Marc Filippino
Good morning from the Financial Times. Today is Friday, April 22nd, and this is your FT News Briefing.
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Elon Musk really wants to own Twitter, and he’s putting his money where his mouth is.
Richard Waters
He’s put $33bn down. No one’s ever offered $33bn of their personal fortune, you know, to buy a company before.
Marc Filippino
And it was a dramatic week for Netflix. Bad news about subscribers and shares fell off a cliff.
Katie Martin
It really tells you that you know you’re not in Kansas anymore
Marc Filippino
And we’ll play an online game where the challenge is to reach net-zero emissions by the year 2050. Spoiler alert, it ain’t easy. I’m Marc Filippino, and here’s the news you need to start your day.
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Marc Filippino
The speculation this week about whether Elon Musk would be able to finance a bid to buy his favourite social media site reached a climax yesterday. The Tesla CEO unveiled plans for a $46.5bn takeover bid of Twitter. Lots to chew on, but I had a simpler question for our west coast editor Richard Waters. Why does Musk want Twitter in the first place?
Richard Waters
Well, I can tell you why he says he wants Twitter, and that is because he says, you know, free speech on the internet or at least on this social network is under threat. And he’s the man to guarantee it. We don’t know how much of that is true, how much of it is because he wants to protect his own platform, his own megaphone on Twitter, or even just how much he thinks this is a good deal. I mean, he stepped in and started buying Twitter stock when it was at a big discount to where it was trading last year. And, you know, he thinks this is a great asset that can be massively more valuable. So take your pick as to, you know, the real reason he stepped in.
Marc Filippino
How do you think members of Twitter’s board are going to react to this, Richard? You know, you’ve got Twitter founder Jack Dorsey on there, folks from the private investment firm Silver Lake. What are they going to say to all this?
Richard Waters
Well, I think for all Twitter board members now, you know, they’ve really got to face up to a difficult question, which is this price that Musk is offered is still considerably below where Twitter traded before the stock market correction setting in November, and therefore it looks like, you know, they’d be selling on the cheap. On the other hand, it is still a big premium to where the stock was. As of yet, there’s no sign that anybody else is going to step in. You mentioned Silver Lake around the board, Egon Durban and Silver Lake is, you know, is one of the directors who’s going to call the shots there. He’s like any other director. He has a fiduciary duty to represent the shareholders of Twitter and make sure they get a good deal. And I think risking losing Musk as a bidder would be bad for Twitter shareholders. So it may be that there are alternative transactions. I mean, this is the big question now. Is Twitter going to be looking for something else? And would Silver Lake, for instance, play a role in that? We don’t yet know, but they simply can’t let Musk walk at this point.
Marc Filippino
Richard Waters is the FT’s west coast editor. Thanks, Richard.
Richard Waters
Yeah, Marc, good to talk to you, as always.
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Marc Filippino
The other big company drama this week was the Netflix horror show. The company’s first quarter earnings reveal big subscriber losses and even worse numbers potentially for the current quarter. Investors bailed big time. Netflix shares flopped nearly 40 per cent since the beginning of the week. The FT’s Markets editor Katie Martin joins me to make some sense of this. Hey, Katie.
Katie Martin
Hey, how you doing?
Marc Filippino
I’m doing well. So what happened here with Netflix?
Katie Martin
So there’s a couple of things really. One of them is that consumer habits are changing incredibly quickly as we come out of all the pandemic lockdowns. You know, while we were all confined to our homes, you fast forward from 2020 to 2022, and it’s a completely different environment for consumers. And we don’t have to rely solely on on television to, you know, keep us going. And so there are stocks that did incredibly well through the pandemic that are just going to find life a lot more difficult. This is a much more punishing environment, you know, if you put out results that are a bit of a stinker. And Netflix is where a proper stinker, then the market will not be kind to you.
Marc Filippino
And of course, stocks in general are going down as interest rates go up. And, you know, just yesterday, Federal Reserve chair Jay Powell said that the Fed would potentially raise rates by half a percentage point when they meet again next month. But but really, I want to ask you about the European Central Bank. The ECB signalled it would raise rates in the coming months. And yesterday there was a big sell-off in debt markets and borrowing costs actually shot up to an eight-year high.
Katie Martin
Well, part of it is that where the US debt market goes, the rest of the world follows. And so there’s been a bit of a kind of gravitational pull in the European market from what’s been happening with Treasuries. The other is that it’s not so outlandish, and I did think that the ECB might raise rates for the first time since 2011 relatively soon because Europe, despite the fact that it’s got literally a war on its border, has got precisely the same sorts of inflation pressures that you see in the States and elsewhere. So the thing is, can the European Central Bank raise interest rates without tipping the eurozone economy into another recession? It’s difficult enough job for the Fed in the US to get through this, but for Europe it’s even harder because you just have got a much bigger hit economic growth from what’s going on in Ukraine than you have in, for example, the US.
Marc Filippino
Katie Martins is the FT’s markets editor. Thanks, as always, Katie.
Katie Martin
No problem.
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Marc Filippino
So the other day I played a game with my colleague Sam Joiner. Sam heads our visual storytelling team, and he helped create the FT climate game. It’s an online game that challenges players to dial back the worst effects of climate change. The goal is to reach net zero emissions by 2050. Here’s Sam.
Sam Joiner
You have to keep global temperatures to 1.5 degrees by cutting emissions while preserving nature and protecting livelihoods. And we worked with the International Energy Agency to create questions that take you from 2022 to 2050 to see if you could do that.
Marc Filippino
All right. So I need to keep global warming to 1.5 Celsius by cutting energy-related carbon dioxide emissions to net zero by 2050, correct?
Sam Joiner
Yeah, that’s exactly right. Yeah.
Marc Filippino
OK, so I’ve got 100 points to spend throughout the game, and I can I can choose an adviser. I’m going to choose Gina Green, who’s the teen activist, which is very clearly like Greta Thunberg. OK, so I have 100 points. Round one, the first question is coal makes up three quarters of the CO2 produced by electricity, and they ask me, “Do I want to phase out coal plants in wealthy countries?” That’ll cost me five of my 100 points. “Let the market take its course and coal demand will fall.” That’ll take two of my points. And “stop all new coal plants globally and close those in wealthy countries.” That’s 10 points. Now, Sam, in your position, which one would you do?
Sam Joiner
I would, I would go for the most costly. The more energy you spend cutting emissions now and in the next 10 years, the better it is later, the more of an impact you have later.
Marc Filippino
So I’m going to go against what you said here because I’m budget-minded. I’m going to phase out coal plants in wealthy countries over the next 10 to 20 years. So I’m just going to spend five points here. I’m going to hit next question. Cutting emissions in all areas needs new technologies. I’m going to make a roads made of solar panels because I think that’s pretty neat and I’m going to click better electric vehicle batteries. Does that sound about right to you?
Sam Joiner
You might not have gone for those two, but it’s not the worst attempt I’ve seen.
Marc Filippino
OK, now spend those 10 points, and my adviser, Gina Green, says I’ve made a good decision.
Sam Joiner
Says the teen activist. She’s got great powers, but they might not be in the innovation space. One of the great things about the game is that all of the decisions you make pay off or don’t pay off later. So you will find out how investment in solar panel drives is going to go. A sort of disclaimer here is that I think if solar panels aren’t tilted, they might struggle to absorb the amount of sunlight that you might need for them to be effective.
Marc Filippino
Bit of a spoiler there, but that’s all right. OK? I’ve gotten a message from Gina Green. A giant iceberg almost the size of Greater London has broken off. A sign that the West Antarctic ice sheet may be becoming more unstable (dejected sound effect). Oh, it just made a really unhappy sound. Why was that? I thought I had been doing well up until this point, Sam.
Sam Joiner
Yeah, I think you might have just hit a tipping point. So tipping points were introduced to reflect the fact that the world is already changing in ways beyond our control. We’ve kind of got these key planetary tipping points, which are major climate systems. The Amazon rainforest is one. Antarctica is one. And we wanted to introduce a kind of an element of that where you don’t have a control over these things. So you’ve open a box at this point, kind of Pandora’s box, and you’ve got a 50-50 chance of finding out if a tipping point has been reached. And you have to deal with the consequences of that.
Marc Filippino
It sounds like based on what you’re telling me about tipping points, that no matter if I had a perfect score in this game, there’s still some things that are completely out of our control. You’re taking out the game at this point in terms of grander climate change that we just we can’t stop at this point.
Sam Joiner
I think that’s exactly right. We are on the pathway to disaster at the moment. What we’re trying to do is mitigate that and to adapt so that we can improve the situation. And I think one of the key lessons from the game, as well as investing in these things early, is actually to portray the amount of work that you need to put in. I think getting rid of all petrol cars by 2035, people just can’t believe that that is the level of change that is required. But one of the things put into this game that I learnt is that it’s a monumental amount of effort that we need to put in. And I think you can play this whole game, think you’ve done really well and still see that that actually that that we are on a pathway to major upheaval and major changes to the way that we live.
Marc Filippino
OK, so tough stuff, both in real life when it comes to climate change and in the game, but you should still give the game a try. We have a link to the FT climate game in our show notes. Sam Joiner has helped design it. He heads our visual storytelling team. Thanks so much, Sam.
Sam Joiner
Thanks, Marc.
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You can read more on all of these stories at FT.com. This has been your daily FT News Briefing. Make sure you check back next week for the latest business news. The FT News Briefing is produced by Fiona Symon and me, Marc Filippino. Our editor is Jess Smyth. We had help this week from Michael Lello, Peter Barber and Gavin Kallmann. Our executive producer is Topher Forhecz. Cheryl Brumley is the FT’s global head of audio, and our theme song is by Metaphor Music.
This transcript has been automatically generated. If by any chance there is an error please send the details for a correction to: typo@ft.com. We will do our best to make the amendment as soon as possible.