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Willravel · 12-01-2010, 03:42 PM

I think this topic is best in Philosophy, though it could work on economics or politics.

Bank of America stocks recently fell significantly after speculation that Wikileaks will release documents indicating that BofA was involved in flagrant violations and unethical practices. The loss to investors was around 3% (the bank's shares closed at $10.95, down 36 cents), which is quite a loss.

Bank of America's troubles are fairly well known now, from the Merril Lynch merger to issues of ethically questionable billing practices. If more unethical behaviors are unearthed in the next leak, it's probable that investors will lose a lot more than 3%.

This brings me to my question: from a moral standpoint, do you believe investors share in the responsibility of the things they invest in? If you knowingly invest in a bank that's involved in unethical or ethically questionable practices, are you not enabling those practices by investing? Or are your hands washed clean by the profit motive?

Personally, I'm concerned with the disconnection between investors and that in which they've chosen to invest. Most investors only care about results leading in a good profit, discounting what and who it is they're investing in. Personally, when I invested in the past with a broker, I was never told about the company other than things like "they're making a pill that makes people feel better" or "they build machine parts". I left the market a few years ago, with the exception of my Apple stock which I only have because I'm a bit of a fanboy. If someone told me that I could invest in a bomb-making company and see an annual increase of 28%, I'd turn them down flat because I would be profiting from death and I can't justify that to myself.

12-01-2010, 03:42 PM	#1 (permalink)
Willravel ... a sort of licensed troubleshooter.	Investor Moral Responsibility I think this topic is best in Philosophy, though it could work on economics or politics. Bank of America stocks recently fell significantly after speculation that Wikileaks will release documents indicating that BofA was involved in flagrant violations and unethical practices. The loss to investors was around 3% (the bank's shares closed at $10.95, down 36 cents), which is quite a loss. Bank of America's troubles are fairly well known now, from the Merril Lynch merger to issues of ethically questionable billing practices. If more unethical behaviors are unearthed in the next leak, it's probable that investors will lose a lot more than 3%. This brings me to my question: from a moral standpoint, do you believe investors share in the responsibility of the things they invest in? If you knowingly invest in a bank that's involved in unethical or ethically questionable practices, are you not enabling those practices by investing? Or are your hands washed clean by the profit motive? Personally, I'm concerned with the disconnection between investors and that in which they've chosen to invest. Most investors only care about results leading in a good profit, discounting what and who it is they're investing in. Personally, when I invested in the past with a broker, I was never told about the company other than things like "they're making a pill that makes people feel better" or "they build machine parts". I left the market a few years ago, with the exception of my Apple stock which I only have because I'm a bit of a fanboy. If someone told me that I could invest in a bomb-making company and see an annual increase of 28%, I'd turn them down flat because I would be profiting from death and I can't justify that to myself.