This Week in ESG and Impact Investing

In a world where financial security seems increasingly elusive for the younger generation, the fight against climate change emerges as another battleground where youth are grappling with the consequences of decisions made by older generations. The conversation above sheds light on the structural inequities embedded in the tax system, which disproportionately burden younger individuals striving to achieve economic stability. As wealth becomes concentrated in the hands of a select few, exacerbated by policies favoring capital gains and mortgage industry interests, younger Americans find themselves facing stagnant wages, unaffordable housing, and diminishing opportunities. These economic challenges intersect with the urgency of addressing climate change, as younger generations inherit a planet ravaged by environmental degradation and unchecked resource exploitation. As young people mobilize to demand action on climate change, they are not only advocating for a sustainable future but also

  Commerce Secretary Gina Raimondo spoke at the  Semafor World Economy Summit 2024 on the role of her institution going forward. Secretary Raimondo spoke highly of Biden’s economic policy, specifically citing the Chips Act capacity to empower her Department to make significant progress in  semiconductors. According to the Secretary, "America currently manufactures zero percent of leading-edge chips." Raimondo envisions twenty percent of all chips being made on American soil by 2030. She further emphasized localizing the chip ecosystem, claiming that ‘technological security is economic security, and economic security is national security’.         Raimondo makes clear that her advocacy for bolstering domestic semiconductor production does not connote an inclination toward economic isolationism. On the contrary, she underscored the need for continued engagement with international trade partners, including China, while cautioning against overreliance on foreign technology. Her

COST-SAVING OPTIONS FOR BLACK AMERICANS TO CONSIDER AS MORTGAGE RATES EXCEED 7%. William Michael Cunningham, an economist and owner of Creative Investment Research, says that though the 30-year rate has increased, it is still much lower than it was in October 2023, when it was about 7.8%. He says that means the monthly costs for today’s buyer on a $250,000 mortgage with a $10,000 down payment is $1,728 at 7.8%, as opposed to $1,613 on a 7.1 % mortgage. He says the difference would save a buyer over $41,300 over the life of the mortgage in payment and interest costs. “That’s four times the amount of the down payment than you placed on the home that you’re buying, giving you more money to buy another house if you decide to do so.” He says another cost-saving option Black homebuyers should consider is energy-efficient mortgages . See: https://www.blackenterprise.com/cost-saving-options-for-black-americans-to-consider-as-mortgage-rates-exceed-7/

Presenting a thought-provoking take: The latest unemployment rate for Black Americans may have risen because of a recent rash of anti-DEI efforts, mainly from the education and corporate sectors. According to a new report by Creative Investment Research, the higher jobless rate for Blacks nationwide in March 2024 potentially stems from specific incidents that accentuate the impact of anti-DEI measures on Black employment. That analysis was provided to BLACK ENTERPRISE by William Michael Cunningham, an economist and the owner of Creative Investment Research in Washington, D.C. In his report, Cunningham explained that the unemployment rate for whites stayed relatively stable from January 2023 to March 2024, hitting between 3.1% and 3.5%. For Blacks, he says the rate rose from 5.4% to 5.8% in November 2023 before falling to 5.2% in December 2023 but soared to 6.4% in March 2024. Conversely, Cunningham noted the unemployment rate for Asians is lower among all groups. It was 3.5% in Novemb

In a recent episode of the Daily Show, anchor and host Charlamagne expressed a lack of faith  in the use of DEI programs in America. Charlamagne explains how he believes DEI is a front for companies to feign diversity-mindsets while maintaining predominantly white employee populations.  He gives the example of Nike who encourages diversity but has a completely white board of directors. His main qualm with this is that DEI is just serving as corporate PR, even going on to explain how DEI programs can act as evidence in a corporation’s favor when facing a civil rights lawsuit. Charlamagne is warranted in these beliefs; the world of corporate DEI is often lacking integrity and authenticity.  Where he is wrong, however, is the conclusions he draws from them.        Charlamagne claims that DEI is mostly ‘garbage’. He states that over 900 studies have shown that DEI is ineffective. He does not provide sources for these studies or mention any specifics. (Forbes Magazine noted this inaccuracy:

  From January 2023 to March 2024, the unemployment rate for whites remained relatively stable, fluctuating between 3.1% and 3.5%. For Black individuals, the unemployment rate initially increased from 5.4% to 5.8% in November 2023 before decreasing to 5.2% in December 2023. The rate reached 6.4% in March 2024. In contrast, the unemployment rate for Asians remains the lowest among all groups, dropping to 2.5% in March 2024. Hispanic individuals saw a modest fluctuation in their unemployment rates, staying within the 4.5% to 5% range. One reason for the increasing unemployment rate for Black individuals, along with the decrease and stability in rates for Asians and Hispanics, is preferential hiring of Asian and Hispanic individuals over Black individuals. We attribute this to systemic biases and to growing anti-Black hiring practices due, in part, to recent anti-DEI efforts. Specific recent incidents quantify and underscore the impact of anti-DEI measures on Black employment. For instanc

  "The labor force participation rate is the percentage of the civilian noninstitutional population 16 years and older that is working or actively looking for work. It is an important labor market measure because it represents the relative amount of labor resources available for the production of goods and services." Source: US Department of Labor.  https://www.bls.gov/opub/mlr/2016/article/pdf/labor-force-participation-what-has-happened-since-the-peak.pdf

Despite both consumer and institutional interest in artificial intelligence continuing to grow across the financial services industry, the majority of leaders are still unsure about the technology and its potential uses — leaving a select group of executives to lead their organizations into the fray.  Arizent, the publisher of American Banker, surveyed 127 financial institution professionals to find out how traditional and generative AI is unfolding in the industry with respect to applications, risks versus rewards, impact on the workforce and more. Respondents represent banks ranging from less than $10 billion of assets to more than $100 billion of assets, as well as credit unions of all asset sizes. The results showed that familiarity is the largest hurdle for adoption. Tech-minded changemakers helping prepare their organizations for AI said the top two things they are doing are researching providers and attending industry conferences or events on AI. They are also creating worki

A federal judge in Texas has ruled that the Minority Business Development Agency (MBDA) can no longer provide exclusive assistance to businesses owned by people of color, following a lawsuit alleging unconstitutional policies. The MBDA, originally established to promote growth in minority-owned businesses, must now provide support to all businesses regardless of race. The judge emphasized the need for concrete evidence of past discrimination to justify race-based assistance programs, indicating a shift away from policies that prioritize minority businesses without sufficient evidence of discrimination. This ruling reflects broader debates around affirmative action and equity measures, suggesting a trend of legal challenges to programs aimed at addressing inequity. Opinion from a young person’s perspective As a young person, witnessing this decision regarding the Minority Business Development Agency (MBDA) prompts a deep reflection on the complexities of addressing systemic inequalities

Unemployment data indicates persistent disparities in unemployment rates among the racial/ethnic groups studied. Over the period from January 2023 to February 2024, the Black population consistently experienced higher unemployment rates compared to other groups. In contrast, the Asian population, aside from a spike in November 2023, generally had the lowest unemployment rates. Differences Between Groups: - Black unemployment rates were 1.3% to 2.9% higher than those of the White group throughout the period. This suggests a significant and persistent gap that does not close over the months observed. Even when the Black unemployment rate decreased from its peak in November 2023, it was still higher than the rates for other groups. Black small business ownership has been on the rise in recent years, but it is important to note that Black-owned businesses have had less access to capital, higher loan denial rates , and less favorable loan conditions compared to businesses owned by other rac

  International Women's Day!  #breakthebias

New data show that venture funding for Black-founded startups remains dreary. For the first time since 2016, backing for those companies in 2023 fell below $1 billion to $705 million, according to a new report from tech research firm Crunchbase. The eye-popping 71% decline for Black startups was much larger than the 37% drop in combined venture capital (VC) dollars invested in 2023 as the market retreated. The latest numbers also reflect Black founders last year getting over $300 million less in those dollars than seven years before that. During the peak funding year of 2021, Crunchbase shared that $4.9 billion was invested in Black founders. The 2023 figure represents an 86% drop from 2021 for those entrepreneurs. The drop in VC funding to Black start-ups is significant as those firms need the capital to launch businesses, expand, and gain working capital to help them survive. Further, Black-owned women’s small businesses continue to struggle to land VC funding even though they’re amo

On Thursday, February 22nd, Politico held its annual Governor’s Summit hosting six state governors and reviewing their thoughts on various issues. With a range of political views ranging from those of Republican Governors Association head Brian Lee to liberal New York governor Kathy Hochul, many sides of the partisan spectrum were present. Still, one can’t help but feel as though the governors’ responses were reserved and cryptic given that this is an election year where political transparency is arguably more important than ever. This article summarizes relevant views by the event’s panel of six governors, attempting to provide insight on future policy. Nonetheless, extracting substance from their words is akin to fighting an uphill battle given the governor's ability to dance around questions. First to speak was Governor Brian Kemp of Georgia. He voiced a desire to expand Georgia’s electric car (EV) market, elucidating plans to centralize electric car manufacture in his state as

In the world of finance, credit unions, banks and securities firms are constantly navigating choppy waters. During a recent discussion, Todd M. Harper, Chairman of the National Credit Union Administration, shed light on the challenges and opportunities that credit unions face. Held at the Brookings Institution, the event covered the state of credit unions, regulatory efforts, and the unforeseen hurdles that may lie ahead for the financial sector. At the heart of the discussion was the role of credit unions in serving specific communities, with Harper acknowledging and highlighting the unique and diverse nature of credit union membership. These  range from employer-focused credit unions to those with multiple membership common bonds. At the event, a special focus was placed on minority depository institutions (MDIs). These common bond connections (typically based either on employment or community ties) shape the outlook of credit unions. This requires credit unions have flexibility in t

Creative Investment Research (CIR) has consistently maintained that the present state of the economy is not just adequate but significantly superior to those of the past. This view was corroborated by Federal Reserve Chair Jerome Powell in a 2/4/2024 interview on 60 Minutes , where he addressed and sought to allay concerns related to ongoing inflation at the microeconomic level. Chair Powell pointed out that inflation rates have decreased rapidly and markedly, a trend not observed since the 1980s. He highlighted the current low unemployment rate of 3.7%, which signifies a robust labor market that bolsters an ongoing trend of deflation. Despite rapid changes in key macroeconomic indicators, which might raise concerns, Powell reassured that the inflation rate remains only moderately above the Federal Reserve's target of 2%. This margin allows the Federal Reserve flexibility to adjust policies in response to unforeseen market shifts. Powell also explained the rationale behind the 2%

Unemployment by Race - Year-over-Year Analysis: - White: The rate increased slightly over a year from 3.0% to 3.4%, indicating a slight uptick in unemployment but relatively stable conditions. - Black or African American: Despite the decrease at the end of 2023, the rate is lower in January 2024 (5.3%) compared to December 2022 (5.7%), suggesting positive long-term improvement. - Asian: With a decrease from 2.4% in December 2022 to 2.9% in January 2024, this group has seen an overall increase in unemployment rate but remains the group with the lowest rate. - Hispanic: There has been an increase in the unemployment rate from December 2022 (4.1%) to January 2024 (5.0%). This represents a nearly full percentage point increase over the year, which could suggest worsening employment conditions for this demographic or could be influenced by broader economic trends. Overall Context: - Racial disparities in unemployment rates are evident, with Black or African American individuals experiencing

          In 1935’s ‘The Black Reconstruction of America’, W.E.B. Du Bois describes the tragic nature of man to revert to what they know even if that knowledge is an atrocity: “The slave went free; stood a brief moment in the sun; then moved back again toward slavery” . Now, in a time of supposed modernization, we witness the Supreme Court behaving just as Du Bois indicates with respect to  Edward Blum’s reckless onslaught against affirmative action. Starting with Harvard and the University of North Carolina (UNC). America moves back towards the history we seek to escape.  In two cases, Blum fought for the supposition that affirmative action actively discriminates against Asian students. As he stated in an interview with Time Magazine, “The mission of Students for Fair Admissions, the sole mission, is to end the use of race and ethnicity in college admissions. What happens after that is a different story.” (Carlisle.) Blum further clarifies that he wants to eliminate admission-discri

(PHOTO: Abhey Singh Guram, Creative Investment Intern, pictured with Dr. Lael Brainard, National Economic Advisor, at The Brookings Institution on January 22nd, 2024.) During a recent event at the Brookings Institution, Dr. Lael Brainard, President Biden's National Economic Advisor, emphasized the importance of place-based growth in revitalizing communities across the United States. The discussion revolved around the administration's commitment to spreading economic prosperity to regions left behind, focusing on sustainable initiatives and connecting communities.  This piece will explore the environmental justice framework, the concept of equitable development, their correlation with the points raised at the Brookings event, and recent initiatives that have come out of the White House. It underscores the importance of sustainable policy-making to build more resilient communities, and the importance of sustainable initiatives, elucidating how all these elements intertwined. Envi