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4 Mar 2008

Introduction to Carbon Markets and Emissions Trading

NYMEX Global Change Associates and the Environmental Markets Association is sponsoring a 5.5 hour class on carbon and emissions trading on April 1, in New York City at the New York Mercantile Exchange, 12:30 pm to 6:00 pm.

The half day seminar on US carbon markets will be taught by Peter Fusaro, Thaddeus Huetteman and Gary Payne. This training will be followed by an emissions trading electronic simulation and then mock trading on the NYMEX trading floor. The afternoon ends with a cocktail party.

According to the Environmental Markets Association, it is highly likely that within two years the US Federal Government will mandate economy wide greenhouse gas emissions reductions that will focus on reducing the US carbon footprint of over 6 billion tons. This new financial market will accelerate the rapid deployment of cleantech investment and requires understanding of how the cap and trade program will impact Fortune 1000 companies as well as create new investment opportunities.

The seminar is intended for busy people who in one afternoon can learn what carbon trading and finance, the state of the markets, and what are the investment opportunities.

This 4 hour class incorporates the following elements:

What are Environmental Financial Markets?
What are "Cap and Trade" programs and how did they emerge in the U.S.
What is Carbon Trading and Finance?
What risks and opportunities arise for companies under trading programs?
What lessons can be drawn from existing U.S. trading programs for carbon?
What will the California market look like?
What will impact the Northeast's Regional Greenhouse Gas Initiatives?
What is Congress now considering on climate change?
What is the EU Emissions Trading Scheme?
What alternative instruments are available in pre-compliance to lay-off risk?


International offsets; What is the Clean Development Mechanism under the Kyoto Protocol

Voluntary programs;

What is the role of the Chicago Climate Exhange
Derivatives (Either exchange traded or over the counter)

What technology solutions are available? Other physical compliance options?

How does the cost of compliance influence carbon prices?

Practical aspects of Emissions trading Emissions Trading Simulation (EMA Trading Group Exercise)

Hedging positions using Exchange Traded Options (NYMEX Floor Exercise)

The Environmental Markets Association (EMA) is the premiere trade association for environmental industry professionals who are active or interested in the market-based solutions to combat pollution and create a sustainable environment.

Christian Hedge Fund Founder Arrested For Fraud

Hedge fund founder, Steve K. Wilson, was arrested last week on charges related to fraudulent hedge funds operating under the names; Christians in Crisis Investment Fund, Shake the Nations and Opus Capital Holdings. He is being held without bail.

According to FBI allegations, Wilson solicited individuals to invest in what he described as a high risk hedge fund which, based on the investment agreement, promised investors a 2% monthly return (24% annual return) on their investment. The agreement also gave the investors the ability to withdraw earnings, or after one year, the investor could ask for the return of their principal.

Investigators determined that Wilson maintained two financial accounts associated with Christians in Crisis (CIC). Investor contributions were deposited into a Washington Mutual (WaMu) account in the name of CIC Investment Fund. A portion of the money was then transferred into an Ameritrade brokerage account in the name of CIC International. An analysis of these two accounts demonstrates that the CIC Investment Fund operated as a Ponzi scheme.

During the period of March 2006 through July 2007, approximately $9 million was deposited into the WaMu account. Wilson withdrew at least $1.1 million for personal expenses such as a 2007 Porsche Cayman and a 2006 Sea Ray yacht.

He disbursed approximately $2.06 million to investors as capital appreciation or earnings. These payments were not the result of earnings and appear to be lulling the investors into a false sense of security. The money came from new investors.

Authorities say Wilson, a.k.a. Stefan Andre Wilson, changed his name to hide a fraud conviction and bankruptcy filing, and convinced some of his investors to refinance their homes in order to invest in his fund.

Hedge Fund Aramid Launches Into TV and Digital Entertainment

Hedge fund Aramid Entertainment is looking to raise a further $200 million to fund their diversification into television and other digital financing projects.

Simon Fawcett, chief executive of Aramid Capital Partners, said, "We have proved our ability to generate uncorrelated returns through the application of an asset-backed lending strategy to entertainment and digital content finance,... we are confident that the Aramid Entertainment Fund will continue to offer investors the opportunity to access genuine alpha returns outside the traditional markets in a low beta sector."

Aramid, a hedge fund specializing in the provision of mainly motion picture entertainment finance, has already invested $210 million and earned in excess of 20% in 2007. It provided financing to 20 independent film projects, invested in two studio finance deals in the United States, as well as in a live national U.S. theater portfolio.

The fund has sought steady risk-adjusted and non-correlating returns through providing financing solutions for producers, including tax credits and bridge and mezzanine financing to underwrite short- and medium-term liquidity on a low to medium risk level to producers and distributors of film, television and other entertainment.

Some of the projects Aramid is involved in are: "How to Lose Friends and Alienate People" based on the memoir of a struggling British writer trying to fit in at Vanity Fair magazine in New York. The film, which stars Simon Pegg, Kirsten Dunst and Jeff Bridges, is due for release in October. Other films to which Aramid has given financial backing include "Good," "The Secret of Moonacre," "Choke" and "Black Water Transit."

The Aramid Entertainment Fund is an open-ended investment company incorporated in the Cayman Islands. Aramid Capital charges a 2% annual management fee to institutional investors and a 3% fee to high-net-worth investors. The performance fee for institutions is 20% and either 25% or 30% for private investors. The fund administrator is Maples Finance and the minimum investment is $50,000.