Today’s announcement by the elegantly named Residential Mortgage-Backed Securities Working Group that it was suing over fraud allegedly perpetrated by the late, if unlamented, Bear Stearns notes that the group’s weapon of choice is the Martin Act. Faithful readers may recall that the act is not a federal law but a New York state law enacted in 1921 to crack down on “blue-sky” stock manipulators, i.e. pump-and-dumpsters whose equities were backed by nothing more than the open air. (Geez, at least today’s abusers of collateralized debt obligations had a horrible, but genuine, credit ... Read More
Unleashing a Wall Street Watchdog
April 23, 2012 • By • Leave a Comment
No one doubts that the Great Recession has been the worst economic crisis in this country since the Great Depression. By whatever yardstick — the near collapse of the banking system, the 8.8 million jobs lost between 2008 and 2010 — no downturn in the intervening 80 years comes close. The crisis has forced a fundamental rethinking of the financial system, a conversation that is now centered on the 2010 reforms known as the Dodd-Frank Act. But the 2,319 pages of legislation do not hold all of the answers. If the regulators who are responsible for enforcing the hundreds of new rules are not ... Read More
Smart Money and Green Investments
November 2, 2010 • By • Leave a Comment
There are lots of reasons for going green — 1.5 million of them in California alone. That's the number of jobs that have been created over the past 35 years as a result of the state's energy efficiency policies. Together, they've generated a $45 billion payroll. California jobs in clean transportation, renewable energy, clean air quality, green building construction, energy efficiency and environmental protection have grown 10 percent since 2005, or 10 times as fast as state jobs overall, research shows. It's a trend fueled by volatile prices of oil and gas, increased environmental ... Read More
Picking Stocks? Count the Butts in Pews
March 7, 2010 • By • Leave a Comment
Looking to invest your IRA in companies that take few risks while promising steady, if slow, growth? Just count the churches around company headquarters. That’s the conclusion of two accounting professors in Hong Kong whose recent study reveals that publicly traded companies in the U.S. are less likely to take financial risks — but more likely to grow, albeit slowly — when churchgoing and other measures of religiosity are high within the community where top management is based. Warren Buffett made headlines in late February commenting on how public companies should manage risk, ... Read More
Partisan Portfolios
June 15, 2009 • By • Leave a Comment
The 1978 Ethics in Government Act requires the disclosure of certain financial information by some members of all three branches of the federal government, including a listing of investment holdings and their approximate value. This graphic shows the total amount owned (in millions of U.S. dollars) by U.S. senators and representatives in the top 50 most widely held companies as of 2007. The proportion of holdings in each company by party is shown with color (blue for Democrat and red for Republican, with brightness varying by degree of party ownership) and through offsets from a vertical ... Read More
Good Workplaces: Profit and Principles
March 10, 2008 • By • Leave a Comment
Anyone who has ever flipped through a mutual fund prospectus is familiar with the warnings: Get ready to stomach seesawing stock prices. The value of your nest egg could actually drop over time. Strong past returns don’t equate to stellar future performance. And for the investor with assets in a socially responsible fund, the financial world typically adds another caveat: Prepare to give up some investment gains if you want your money to achieve your social goals. But Professor Alex Edmans of the University of Pennsylvania’s Wharton School of Business says stock performance and ... Read More
