> But let’s assume there is indeed enough time, and that we suddenly get serious about planning. What should we do?<p>In the United States public planning is typically limited to figuring out how to prop up the private financial system for one more quarter. In the U.S. most money is created through real estate mortgages. Although people like to talk about gold, crypto, consumers, producers, and government spending the mainstream financial system in charge of allocating the resources is really a mortgage based system.<p>Suppose someone has an estate with buildings and structures with replacement cost of $200,000. A broker says the estate has a comparable sales price of $600,000. In a loose money system we just trust the banks and brokers to do all of the planning, publicly guarantee mortgages at the reported $600,000, and have federal reserve buy assets to prop up prices at whatever number private finance has fixed upon.<p>In a slightly tighter system, we might cap real estate loan guarantees at 200% of replacement cost of non-land fixed capital. So if property has buildings and fixtures worth $200,000 public loan guarantees max out at $400,000 even if broker says property is worth $600,000. In order to write up price to $600,000 the owner would need to install $100,000 more in fixed capital, the effect of which is to redirect a larger share of the money created through mortgages to other sectors of economy.<p>How to use this to promote green energy investment?<p>Suppose instead of a replacement cost cap of 200% there was a replacement cost cap of 150% for normal capital and 250% for green capital. Then in order to take out a property loan for $600,000 the owner would have to install at least $400,000 of normal capital (structures, fixtures, equipment) or at least $240,000 of green capital (solar panels, wind turbines, lifted mass storage systems), regardless of how high the land values in the location had been written up.<p>In our current system the incentive of brokers is really just to write up asset prices as high as possible until the financial system collapses in order to generate some nice asset gains during credit bubbles. We can take advantage of this greed and use it to promote green energy investment by tightening up rules for lending against speculative land values using fixed capital replacement cost caps, which are slightly looser for fixed capital which is green.