July 30, 2015
As America becomes more polarized, many citizens are making political statements with their investing. Liberals shun the so-called evil oil companies while there are mutual funds for social conservatives to avoid investing in products such as birth control pills and IUD’s. This makes little sense. If you are a political ideologue, you should invest in products you despise. That way, no matter what happens, you’ll be happy.
For example, let’s say you are outraged by the corporate malfeasance of British Petroleum. It galls you that they reportedly cut corners on worker safety resulting in an explosion that cost 15 workers their lives and polluted the Gulf Coast for years. You can e-mail your complaints to politicians who will use robo software to delete them from their inbox; or you can make the smart move and buy British Petroleum stock. It has been battered so much that it is now paying a generous 6.3% dividend. If the stock continues to decrease, even though you lost a few bucks – you can console yourself with the knowledge that some canned BP executive is in divorce court with his screeching trophy wife who has been humiliated because she can’t update her fur collection. If the stock goes up, sell a few shares, donate to Bernie Saunders and distribute all the bumper stickers he sends you to your conservative friends. A win-win.
There are opportunities for conservatives too. For example, let’s say you are outraged that Tesla cars are selling because your taxes are subsidizing their purchases. You are looking forward to the coming day when this tax break expires and these liberal global warming statists will finally get their comeuppance. Now what is the chance that these subsidies will be allowed to expire? If you said “Zero'” go to the head of the class. Even in the unlikely event that Congress refuses to resume this subsidy, President Obama will simply issue a fatwa reinstating it and some toady liberal judge will rubberstamp his abuse of power. You will be outraged. That is unless you took the advice of this article. Then when you look in the Wall Street Journal, you will see that your Tesla stock got a 25% pop. You can sell a few shares, pick up a couple of Glocks and show them to your liberal friends. Such fun.
Socially irresponsible investing is a great way to get back some of your tax money. Outraged over the bail out of Goldman Sachs? No problem if you own the stock. It keeps going up and its bonds pay over 6%. If you can’t beat ‘em, join ‘em.
A golden opportunity now exists in Puerto Rican bonds which are now paying over 7% tax free. Puerto Rico is $72 billion in debt and makes Greece look like a paragon of fiscal responsibility. What is the chance that the taxpayers are going to bailout Puerto Rico? If you said “100%,” go to the head of the class. It doesn’t matter if Barack Obama, Bernie Sanders or Ted Cruz is the President. Any politician who opposes a bail out will immediately be pegged as a racist neocolonialist by the liberal media. But more important, Goldman Sachs and politically-influential hedge funds have gobbled up these bonds the way I gobble up my lovely wife’s ziti. When you, the sap taxpayer are forced to bail out Puerto Rico, these guys will be buying penthouses for their mistresses de jour. But if you own the bonds (stick with the General Obligation ones), you can get a piece of the action.
If more people engaged in socially irresponsible investing, our political dialogue would be much more civil.