Right on the Money: Doug Casey on Economics, Investing, and the Ways of the Real World with Louis James

Chapter 21

Doug Casey on Ethics: The Ethical Investor (Part Three)

July 7, 2010

Louis: Doug, you said at the end of our last talk that I wouldn’t like what you had to say about business ethics. Given your two principles:

1. Do all that you say you’re going to do.

2. Don’t aggress against other people or their property.

Why would that be? Sounds like good business to me.

Doug: Well, as far as completing your contractual obligations and not stealing from—or intentionally harming—people you do business with, that’s pretty obvious and we’ve already covered it. No need to discuss that further.

Unfortunately, though, when most people think of “ethical investing,” it has nothing at all to do with ethics. Most people have been deluded into thinking it has to do with not investing in tobacco companies, gun manufacturers, miners, timber companies, oil companies, many drug companies, many agricultural and food companies—in fact, whatever is on the ever-growing hit list of the politically correct. Pretty soon the silly bastards will be saying you shouldn’t invest at all, but give your money to NGOs.

L: Hey, you might be on to something there; if everyone gives their money to everyone else, everyone will get lots of money for nothing—free cash for everyone, what a great idea!

But let’s come back to that in a moment. It’s true that murdering your competitors is a rather short-sighted business strategy. It’s also true that failing to deliver what your customers expect is an even shorter ...