Social Activism in the Market
There is a new and highly impactful move for certain billionaire and institutional investors to focus on areas that have little to do with rational investing strategies, and instead to make a political or social statement by moving money into funds focused on areas such as green energy development, or withholding money from a company or fund that has relations with Israel. This type of investing may make one feel noble or allow large players to express a certain political orientation, but they also distort the financial markets and affect the people who depend on the revenue sources that are being manipulated.
Wall Street’s disastrous week was appropriately capped by another megamerger by two companies that were forced into each other’s arms because they can’t generate domestic growth and were too afraid to tell activist investors to go take a hike. Dow Chemical Co. (NYSE: DOW) and DuPont Co. (NYSE: DD) announced a $120 billion merger on Friday that was heralded by The Wall Street Journal in one of the most inane articles ever to appear in the financial press (which is saying something in light of what passes for financial journalism these days).
The article welcomed the arrival of a “new era of activist investing.” DuPont had been pressured by activist firm Trian Fund Management LP, headed by Nelson Peltz. And Dow was similarly under the gun from Dan Loeb’s Third Point LLC.
Bowing to the alleged influence of these investors forced another late-cycle deal that will lead to tens of thousands of layoffs, lower capital expenditures and high executive payouts. Yet it accomplishes nothing productive in a bear market. The Journal was too busy licking the boots of billionaires to leave out one key fact: both activist funds are losing money in 2015 and have significantly trailed to S&P 500 (their presumed benchmark) in recent years…
If this is the new age of activist investors, it is an ice age. Their nominal returns are poor and their risk-adjusted returns are terrible. Investors who pay two percent management fees and twenty percent performance fees to invest in large cap companies are fools.
The fact that these socially conscious companies are not especially profitable may be of little import to the billionaires who invest in them, but the reality is that such a strategy starves the more rationally “worthy” companies of funding, leading to upheavals, unemployment, and a dysfunctional economy. As the U.S. continues to struggle to grow back the economy and build a more vibrant and active jobs machine, social investing is looking more and more like drag on the system, for which we all pay a price.
Source: moneymorning.com
thank a democrat
Roflmao… No, they aren’t. You shilling for that two-bit grifter, Ron Paul now ??
Sounds horrible more on this information , fact , or guessing , scaring folks so Bradley living in a gov or there rules & reg, no vote on , just going to be this way , fogey the people , Christians / all other do reap way out protection & more
The bubble is about to pop again.
America needs tone Great Again!!
I remember Jesse Ventura me and both my parents used to watch his show till they took it off air..
Oh no according to you once agian the world is ending. Might I suggest a book for you to read “The boy who cried wolf”.
Going to be unleashed if a republican gets elected president.
MESSAGE FROM A CONCERNED CITIZEN: “Has everyone lost their ability to see what is happening in the USA? Think America! Before Obama, there was virtually no visible presence of Islam in America. All of a sudden, Islam is taught in schools. All of a sudden, we must allow prayer rugs everywhere and allow for Islamic prayer in schools and businesses. All of a sudden, we must stop serving pork in public places and institutions. All of a sudden, we are inundated with law suits by Muslims who are offended by America. (For God’s sake, they are IN America) All of a sudden, we must allow burkas to be worn everywhere even though you have no idea who is covered up under them. All of a sudden,Muslim training compounds are popping up throughout the USA. All of a sudden, Muslims are suing employers for being expected to do their jobs. All of a sudden, all of our aircraft carriers are recalled for maintenance by Obama rendering the Atlantic unsupported. All of a sudden, our troops are withdrawn from the middle east. All of a sudden, there is no money for American poor, disabled veterans, jobless Americans, hungry Americans, or displaced Americans, but there is endless money for Obama’s refugee programs. All of a sudden, Obama fills the Federal Government with Muslims in key positions. All of a sudden, there is an ammunition shortage in the USA. All of a sudden, Americans are threatened by the Federal government for complaining about Muslims. All of a sudden, the most important thing for Obama to do is disarm American Citizens. Now, why is it so important for Obama to disarm America? Why? Because a disarmed country is ripe for takeover by the Muslim Army that Obama has imported into the United States. Nikita Krueschev, the Russian Dictator who visited the USA in the 1950s said the USA could never be occupied by any army because of it’s citizen Army. Obama knows this fact and is doing everything within his power to disarm our Citizen Army. If Obama can’t do it legally, he will abuse his power and take every gun from Americans because he knows he must do that to turn the USA over to Islam. Be wary and watchful. Obama’s actions speak far beyond his words. Obama won’t even say the words “Islamic Terrorist”, WHY?”.. PLEASE POST ON YOUR PAGES AND PASS THIS MESSAGE TO FRIENDS AND FAMILIES. GOD BLESS AMERICA. LET’S SEE WHAT WE ARE TRULY MADE OF.
Obama has found a hidden logical looking way in his eyes to follow through with his buddy George Soros’ plan to devaluate the dollar for “Green, clean energy” fooling Americans. Giving American dollars to countries around the world to spend on it. He thinks America’s wealth should be spread worldwide for his excuse, humanity. The wool is being pulled over Americans eyes as we speak. This is one way to spread the wealth around the world and knock America down in financial size. Remember, Soros doesn’t believe that nations have borders. Besides, I’m sure there is money in it for Soros somewhere. He can then send that money to groups like “Black Lives Matter” or buy more TV stations in the U.S. and turn them into Social, liberal stations like he has done, (lots of stock in Time Warner) so they can continue with their agenda of influence of “A New World Order”, one party Democratic socialism. Plus make campaign donations to candidates like Obama using Americans money from profits from the “Go Green” agenda. They know that by dividing us we fall and united we stand. Have you noticed more of dividing of America the last 7 years. Our deficit will be the final straw that brings America to its knees, the dollar will be worth little, then the Democratic Socialists can restructure America as they want! Just give it time! Putin knows this, that is why he jumped into the Syrian war, he won’t stand for “A New World Order.” Unless the next president is a republican this will continue.