LDI is superbly complex so no one understands it, with tricky collateral management and an orchestra of instruments from gilt total return swaps to gilt repo and inflation swaps. But within the British pension fund community, sceptics have largely been the exception and LDI has become widely adopted by most of the UK’s 5,200 defined-benefit pension plans.

Expand too slowly and manufacturers risk losing out on gigascale orders; expand too fast and risk failing to sell equipment from expensive gigafactories. A glut will make some manufacturers bankrupt, according to Norwegian analyst Rystad Energy. The demand will hover around 30-40% of the available production capacity between 2024 and 2030.

UK’s 5,200 defined benefit schemes use derivatives to hedge against moves in interest rates and inflation, which require cash collateral to be added depending on market moves. The sharp fall in the price of 30-year government bonds led to unprecedented demands for more cash. To raise the funds, pension funds sold assets, causing prices to fall further.

The UK’s green bond sale has already pulled in more than £24 billion of orders. The green bond last year drew a much heftier £74 billion orderbook. Yet bondholders have taken fright. 30-year bond yields are soaring above 5%. Green bonds pull in demand from specialist ethical funds. Yet this time the outlook for the UK will dominate investor thinking.

BoE has launched a temporary bond-buying programme to prevent "material risk" to UK financial stability, which could have resulted in the collapse of a swathe of pension funds. BoE will buy as many long-dated government bonds as needed to stabilise financial markets. This news had an immediate impact on the interest rates of UK government debt.

UK day-ahead power prices tripled to record levels as tight generation margins combined with soaring power import, natural gas and carbon prices. The UK's coal phase-out and low wind generation have exposed the market to rising gas prices. Adding to the strain of coal closures has been the UK's ageing and inefficient nuclear power plants.

Total outflows from European stock funds in the past six months have reached $83 bln. Investors have been steadily accumulating short positions on German bunds as yields hover near the highest level in a decade. The outflows from European-focused ETFs are the biggest in at least 15 years, while global stock funds have added $166 billion this year.

Dutch pension funds sold €88 billion worth of assets in the first half of 2022. They used part of the proceeds to meet the margin requirements under derivatives contracts, which had risen due to increased interest rates. Dutch pension funds sold a large proportion of their equities and money market fund stakes, while increasing the share of bonds.

Former Naftogaz chair Andriy Kobolev says that if Russia cuts off gas supply to Europe this winter, it will be the end of Gazprom’s presence in European markets. Russia wants to remain Europe’s primary gas supplier. It is now burning gas, because it cannot reduce output. Shutting down a shaft means a 50% lower output when extraction resumes.

Rapid interest-rate hikes deployed by policy makers have brought to an end a four-decade bull market in bonds. That’s creating a difficult environment for investors, with bonds and stocks sinking in tandem. MSCI's Index of global stocks has slumped 19% this year. Fixed-income investors are showing plenty of demand for government bonds as yields rise.

In the wholesale power market, the price paid to the costliest generator needed to meet demand is paid to all. That is usually a gas-fired power station, even though renewables and nuclear plants supply around 60%. Eventually, “someone has to pull the plug and make price equal cost”, says Sir Dieter Helm, an economist at Oxford University.

Uranium reserves of 7.6 million tons are on a course to reach exhaustion within a century. The Indian institute IISER was successful in extracting uranium from seawater, which contains 1,000-times more uranium than conventional sources. The challenge was to capture it cost-effectively. They managed to capture 95% of uranium within two hours.