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Investing and doing the right thing... can they live together?

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February 09, 2010 – Comments (3) | RELATED TICKERS: MO , XOM , WFM

Well apparently I'm stuck on the topic of right and wrong in the world of economics and business. Today, an article of mine went up called "Is There Room for Morality in Capitalism?", asking whether investors focus on companies that "do the right thing."

How about you CAPS community, what do you think? Are you investing mainly in companies you believe are totally on the up-and-up? If so, how do you go about determining that these companies are right and just?

Matt

3 Comments – Post Your Own

#1) On February 09, 2010 at 4:16 PM, USNHR (33.11) wrote:

This is silly... What I look for in a company is one that does the best thing for the share holders of the company... if the best thing is dumping sludge in the Deleware river and risking the chance of lawsuits and a negative public relations image in the long term, then so be it. Eventually the chickens will come home to roost and the company's stock price will drop like a brick. Look at Toyota right now with their issues.

If a company believes the best policy is to limit executive pay like Whole foods in order to make their employees feel valued and get more work out of them, that is OK with me to. As long as management is doing what is best for shareholder value, ultimately the company is a "Buy".

 

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#2) On February 09, 2010 at 4:37 PM, devoish (97.37) wrote:

USNHR,

How would you know if a company is dumping?

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#3) On February 09, 2010 at 4:37 PM, catoismymotor (< 20) wrote:

When I choose to invest in a company on the list of questions I ask myself is: What benefit does this company provide the public as individuals or as businesses? If I get a case of the warm fuzzies from the answer I get then that is one more point in its favor.

Example: Let's say a Chinese oil company that is not state owned catches my attention. I ask my question and the answer might be: They produce the oil needed to fuel current and future automobile purchases. The growth of the automobile in China will result in greater mobility for the people. Thus a segment of the population, the more affluent, will have a greater sense of freedom and self reliance. I suspect that will spill over into areas of individual liberty and commerce. Thus oil should grease the wheels of Chinese democracy. If only Axl Rose had thought of it that way. And thus if it is good for the citizens of China I think it has merrit in my portfolio.

Granted I know the same oil that propels the growing middle class also makes the tanks roll over Tibetian citizens. But that was going to happen whether the Liu family fueled their new Hummer or not.

I hope that made some kind of sense. I'm not all here today.

Cato

 

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