Tag: investor

System Rigged Against Small Investor.

On By southwerkIn Business Ethics

Facebook IPO: Retail Investors Lose Out While Wall Street Clients Make Profits

In case a reminder was needed, the fallout from the Facebook IPO illustrates that Wall Street appears to be designed to serve the well-connected at the expense of ordinary people.

Ordinary investors may have lost as much as $630 million collectively from the plunge in Facebook’s stock following its public debut, Bloomberg reports. These are the same people who used hundreds or even thousands of dollars of their prized savings to bet on the stock only to have its value drop to way below its opening price of $38 per share.

Facebook IPO: Retail Investors Lose Out While Wall Street Clients Make Profits

Is it moral or ethical to have a rule system which allows the large institutional investors to thrive while penalizing the small investors? Does this encourage responsible investment and make Americans better people?

I think not.

This kind of thing drives people away from investment and it should. That the game is rigged is obvious to the most casual observer. It takes an enormous amount of advertising and badly written text books to get people to buy stock.

Now let’s differentiate here. I heartily approve of investment, that is, buying stock in a company to collect regular dividends and over time have the value of the company go up. That is investment. It carries some risk but it is not the kind of risk carried by those that believe they can buy and sell stock hour by hour, day by day, and make a profit thereby. That is speculation and speculation is inherently risky.

But not all speculators are equal. Let Facebook be a warning to all small investors. Whether you win or lose, investment banks will win.

This is wrong.

It damages faith in the system because the system doesn’t deserve it. If people don’t believe in the basic fairness of society than they will begin to act in ways that are detrimental to that society.

More simply, if playing by the rules doesn’t work, they’ll try something else.

Justice and fairness are for everybody and when they are denied we all suffer.

We should always have in the back of our minds the basic concept of fairness in our dealings. That is how you build a just and fair society.

You punish the wicked and protect the innocent. Is it hard to understand that rule?

James Pilant

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JOIN NOW! 200,000 SIGNATURE DRIVE FOR ELIZABETH WARREN RECESS APPOINTMENT (via Livinglies’s Weblog)

On By southwerkIn business ethics

Let’s get in there and put pressure on Obama to get this nomination done. The banks and the special interests have allied to block it. They are trying to kill the agency before any work can be done. Their crimes and unethical behavior will not be brought into the light without the agency.

Please go sign the petition. Elizabeth Warren will make a difference.

James Pilant

JOIN NOW! 200,000 SIGNATURE DRIVE FOR ELIZABETH WARREN RECESS APPOINTMENT GET COMBO TITLE AND SECURITIZATION ANALYSIS – CLICK HERE EDITOR’S NOTE:  A recess appointment is one in which the President appoints someone during a congressional recess. I’m no expert on the details but I know that recess appointments have been extensively used, particularly by the Bush administration to get around the requirement of getting congressional approval. If Congress is not in session, the President makes the appointment because the p … Read More

via Livinglies’s Weblog

Who will make them pay? (via Livinglies’s Weblog)

On By southwerkIn business ethics

Let’s saddle up! The Wall Street Banks absorb every kind of benefit from being in this nation including taxpayer dollars. Yet, when it comes to taking any responsibility as citizens, they are notably absent. Is there a kind of vicious hypocrisy in absorbing benefits but paying none of the costs?

Let’s make these people know that we know they have failed to act in accord with basic patriotism.

James Pilant

My thanks to Livinglies’s Weblog.

Who will make them pay? You will. Yesterday, in six cities across Illinois, people stood together and demanded Wall Street banks like JPMorgan Chase pay their fair share to end the revenue crisis, create jobs, and stop illegal foreclosures. In New York City, thousands marched on Wall Street demanding that Millionaires and Big Banks pay their fair share. In North Carolina, community leaders made sure the shareholders of Bank of America faced up to … Read More

via Livinglies’s Weblog