There's a carbon allowance market. Simply put it permits the sale and trade of carbon allowances. Without much knowledge of the process I can see how this will get out of hand in the future. Large high carbon output corporations will buy up credits from smaller companies. Other investment companies will come into existance to trade in these allowances and like the mortgage paper that was composed of bits and pieces of loans and sold all over the world...I think you get the idea. You know they will try to sell this to the general public as the new great way of "green" investing. And just like the sub prime and option mortgages there'll be no way to value such paper. What's worse with this senerio is that when the carbon market collapses there'll be nothing of value to back up the paper. No collateral zip nada you'll have toilet paper after getting screwed on that deal. Remember you heard it here first.
The next weapon of mass financial distruction