Five Winning Funds How to Be Good -- and Profitable By Stephen Schurr Senior Editor 06/19/2003 11:00 AM EDT URL: http://www.thestreet.com/funds/fivewinningfunds/10094738.html The top three questions a financial journalist hears: When will the bear market end? Can you give me a good stock tip? And (be- lieve it or not), how can I build an ethical stock portfolio? That's the honest-to-goodness truth -- perhaps "altruism" should be added as a distant third emotion that influences the market, after fear and greed. The first two questions are hard to answer: I think we are in a "low-return environment" in the U.S. that will last for at least a decade, and I'm not much of a stock- picker. (Ask James Altucher, Arne Alsin, Jim Cramer or one of the many Real Money or Street Insight columnists who knows his stuff.) The third one is easy to answer, although it does come with some caveats: Consider socially responsible funds. This week's Five Winning Funds examines the stellar offerings from the world of socially responsible investing -- SRI funds, for short -- and it represents a bit of a change in my thinking. http://www.socialfunds.com My old answer to question No. 3 was: Ethics are too subjective to consider in an investment portfolio. Microsoft (MSFT:Nasdaq - news - commentary) is ethical to some for treating workers fair- ly, but unethical to others who say its 800-pound gorilla tactics stifle competition. Or, General Dynamics (GD:NYSE - news - com- mentary) may be unethical to some because it makes weapons that kill people, but others may have no problem with the high-tech weaponry that helps protect America. Besides, there's no real proof that a do-gooder approach translates into better returns. My old advice: Make your investments to make money, and make the world a better place by volunteering. However, over the past few years, my answers have evolved. Recent studies, including one conducted by the SRI World Group for its Social Funds Web site, indicate SRI funds have, in general, held up better than non-SRI funds during the three-year bear market. Thirty of 52 SRI funds topped more than half of their peer non- SRI mutual funds. That's not overwhelming and it's a short time horizon, but it does signal that SRI funds are as viable as other mutual funds. It also refutes the old line about SRI funds not doing well in bear markets because of their aversion to industri- als, materials and "sin" stocks that hold up in downturns. Also, SRI funds have gone a long way to overcome the perception that they focus on do-gooder companies to the exclusion of stocks that look good. These funds don't have 80% of their assets in Ben & Jerry's; in fact, Intel (INTC:Nasdaq - news - commentary) is the top holding among SRI funds, according to Research magazine. Other big holdings include Cisco (CSCO:Nasdaq - news - commenta- ry) , SBC Communications (SBC:NYSE - news - commentary) , Merck (MRK:NYSE - news - commentary) and, yes, Microsoft. "We understand how Corporate America works -- there is no perfect company," said Todd Ahlsten, skipper of the stellar Parnassus Equity Income fund. http://tools.thestreet.com/tsc/quotes.html?pg=mutualfunds&symb=PRBLX "But when we go to bed at night, we want to feel confident that the companies we own are responsible companies that are trying to do good for society." (Click here to read a companion profile of Ahlsten and his fund.) http://www.thestreet.com/funds/fivewinningfunds/10094625.html The last reason I've changed my tune on SRI funds is a matter of ethics. Given the spate of corporate ethics scandals, the threat of terror that makes the world a more dangerous place and, frank- ly, the fact that many multinationals regularly flout environmen- tal and human rights issues, it is heartening that a swath of the investment arena diligently searches to find companies that aim to make the world a better place, along with making money. Ap- parently, others feel this way: In 2002, while U.S. stock funds saw $10.5 billion in net outflows, SRI funds had $1.5 billion in net inflows, according to Lipper, a Reuters company. What's kept me from shifting all of my portfolio over to SRI funds -- despite my wife's suggestion to do so -- is that I don't think it's possible yet to build a diversified portfolio con- structed entirely of SRI funds. While there are some outstanding U.S. equity funds that pass SRI screens, the group comes up short when it comes to international investing, which makes up more than half of my portfolio these days. Worthy SRI bond funds, meantime, are in relatively short supply, as well. Nonetheless, there are some great SRI funds out there, including the five featured in today's column. The list aims for asset- class diversity -- a good small-cap fund as well as a fixed- income fund, etc. One last thing: Investors looking to buy into SRI funds have two considerations. First -- and this applies to all funds -- make sure the funds have solid management, a history of strong returns and below-average costs. Second, make sure the fund's definition of ethics matches yours -- SRI funds run the gamut from religious funds such as the Aquinas Growth Fund http://tools.thestreet.com/tsc/quotes.html?pg=mutualfunds&symb=AQEGX to environmental funds such as the Sierra Club Stock Fund http://tools.thestreet.com/tsc/quotes.html?pg=mutualfunds&symb=SCFSX to women's issues funds such as the Women Equity Fund. http://tools.thestreet.com/tsc/quotes.html?pg=mutualfunds&symb=FEMMX A good place to start is Social Funds' Mutual Fund Center. http://www.socialfunds.com/funds/chart.cgi?sfChartId=desc 1. Parnassus Equity Income (Large U.S. Stocks) While the $193 million-in-assets Parnassus Equity Income fund (Ticker: PRBLX) falls broadly under the "large-blend" category, the value-oriented manager Todd Ahlsten takes a "go anywhere" ap- proach that hunts for companies big and small. The fund aims to keep about 75% of its assets in dividend-paying companies, making the fund a decent way to look for yield. Do-gooder or no do-gooder, Parnassus Equity Income has been one of the best funds around since its 1992 inception. The fund's five-year average annual return of 10.9% ranks in the top 1% of all large-blend funds, according to Morningstar, and its 10-year returns rank in the top 8%. While Ahlsten has only been at the helm alone for one year (he's been with Parnassus for nine years), the one-year return of 8.13% ranks No. 1, according to Morningstar. And as today's Q&A demonstrates, his philosophy on investing and corporate ethics mirror his predecessor closely. Tech lovers, look elsewhere. http://www.thestreet.com/funds/fivewinningfunds/10094625.html Apart from a small Cisco stake and a few other holdings, Ahlsten sticks to less frothy fare such as Johnson & Johnson (JNJ:NYSE - news - commentary) . The no-load fund's low turnover rate helps keeps the expense ra- tio at a trim 0.96%, compared with the 1.28% category average. 2. Ariel Fund (Small U.S. Stocks) We extolled the virtues of the Ariel Fund (Ticker: ARGFX) in a recent Five Winning Funds on small-cap value stock funds http://tools.thestreet.com/tsc/quotes.html?pg=mutualfunds&symb=ARGFX and in a 10 Questions interview with longtime skipper John Rogers. http://www.thestreet.com/funds/stephenschurr/10089512.html One thing we didn't mention: Ariel Fund also passes the SRI screen. Rogers, at the helm since the fund's 1986 inception, has racked up stellar performance: Its 10-year average annual return of 12.23% ranks in the top 17% among its peers, and the fund's three- and five-year rankings are good for the top 18% of all small-cap value funds, according to Morningstar. His basic in- vesting philosophy: "Slow and Steady Wins the Race," as evidenced by the tortoise logo that graces the fund's Web site. The no-load fund sports a below-average 1.19% expense ratio. For investors looking for a solid small-cap SRI fund, Ariel is a great bet. 3. Ariel Appreciation (Medium U.S. Stocks) Another Rogers-helmed fund turns up on the SRI list, and once again it's a great long-term performer: the mid-cap blend Ariel Appreciation fund. Rogers took the reins of this fund in September 2002 from Eric McKissack, who managed to notch impressive returns while at the helm. Rogers is the founder of value-oriented Ariel Capital Management and the longtime skipper of the firm's eponymous stel- lar small-value fund, which should placate smart investors who seek an experienced hand at the wheel. The fund's three-year average annual return of 11.3% ranks in the top 4% of all mid-cap blend funds, and the 10-year average annual return of 12.98% ranks in the top 15% of its peers, according to Morningstar. The no-load fund's buy-and-hold approach has kept turnover to a mere 13% and its expense ratio at a below-average 1.26%. 4. Domini Social Bond fund While the SRI bond arena has few real standouts -- Parnassus In- come, with Ahlsten as the new manager, has been a strong perform- er in the past -- the relatively new Domini Social Bond fund (Ticker: DSBFX) is a decent, low-cost way to get fixed-income ex- posure through the SRI world. http://tools.thestreet.com/tsc/quotes.html?pg=mutualfunds&symb=DSEFX How does a fund screen for do-gooder bonds? Well, the Domini fund avoids U.S. Treasuries "because they finance the purchase of weapons of mass destruction," according to Domini's Web site. It does invest in other federal agencies, such as housing agencies. The fund's 9.57% average annual return over the past three years ranks in the top 39% of all intermediate bond funds, and the ex- pense ratio is 0.95%, slightly below the 1.02% category average. While there may be better fixed-income offerings in the non-SRI fund arena, Domini Social Bond is a decent way to go for those set on doing the right thing while they put their money to work. 5. Indexer's Choice: Domini Social Equity Index or Vanguard Cal- vert Social Index For investors who like the virtues of low-cost index funds cou- pled with the virtues of socially responsible investing, there are two decent options. The Domini Social Equity Fund (Ticker: DSEFX) mirrors the Domini 400 Social Index, an SRI index of 400 companies that pass screens for environment and social issues -- no guns, no cigarettes, no nuclear power, no alcohol, no gambling, no weapons contractors, on the no-no list; environmental-friendliness, good workplace and community activism are among the do-good list. The nice thing about the fund is that its 10-year average annual return of 9.42% a year is about a half-percentage point shy of the S&P 500, rank- ing the fund in the top 33% of all large-blend funds. The expense ratio of 0.92% is above most traditional index funds, but is lower than the average fund. The newer option is the Vanguard Calvert Social Index fund (Tick- er: VCSIX). The fund, which tracks the Calvert Social Index (similar to the Domini index), has only been around since May 2000 -- its 13% average annual loss ranks in the top 19% of all large-growth funds, according to Morningstar. http://tools.thestreet.com/tsc/quotes.html?pg=mutualfunds&symb=VCSIX The clear advantage over Domini's longer history is the price: Thanks in part to Vanguard, the fund sports a bargain-basement 0.25% expense ratio. While both funds count Microsoft as the big- gest holding, the Vanguard Calvert fund is a bit more inclined towards growth, according to Morningstar.104 responses total.
As a general rule, I avoid social activist investment funds like the plague, based on the following principles: 1) No mutual fund manager knows what I consider "socially responsible". Most of them seem to be quite liberal, "green", "favor Group A or B", "anti-war", etc. and I am not inclined to agree. I haven't seen any which I agree with. 2) A mutual fund manager ought to concentrate solely on making money for me. If it comes down to it, is he going to do his job and make money, or is he going to make some social statement? 3) Money made for me will go to the most socially responsible end that can be imagined: making me more wealthy. J. Paul Getty made his billions, then invented philanthropy. Like him, I can fight the injustice about which I feel the most strongly later on when I have money to do so. Meanwhile, it will keep me off the streets, which is a good thing.
You think like a drug dealer.
Jep, you are obviously not a liberal, nor do you care about the environment, nor are you antiwar, therefore how could you possibly find a socially responsible mutual fund that you agree with? They are for people who are not solely concerned with making more money for themselves, and therefore invest in companies which treat their employees fairly, which do not profit from wars, which do not profit from selling drugs (even legal ones). I don't agree with all their policies either but I am too lazy to choose my own companies to invest my IRA in so I will put up with them investing in some junk food companies. I own part of eBay and I forget what else. On average, my mutual fund (Pax) has done at least as well as its competitors. For some reason, companies that treat their employees fairly tend to stick around longer.
re resp:2: I disagree that I think like a drug dealer. I don't seek out someone else to spend my money to promote what they think is the good of society. If I go to a restaurant, I go there for lunch. If I go to a financial planner, I go to make money. If I want to promote the good of society, I am perfectly capable of sending my money myself to where I think it will do the most good as I define "good". re resp:3: You don't believe in drugs? I believe the pharmaceutical industry probably contributed more to the "good of society" (by doing what would make them money) than just about any other industry in the 20th century. The eradication of polio and smallpox, for two obvious examples, were enormously beneficial. I'm hoping someone makes themselves rich by finding a cure for AIDS.
wow. re #2 .. sure didn't expect that! options are options; all choices are yurs. thinking for profit is the province of capitalists. is mary calling capitalism 'drug dealing'?
I'm amused that anyone could think that liberals have a monopoly on "social responsibility."
My mutual fund has a lot of investments in the pharmaceutical industry and in the medical industry, but nothing invested in nicotine or alcohol or guns or airplanes or oil or cars. I think they have a large investment in UPS. I read a book once about UPS, which decided to start a training program for people who had trouble keeping jobs. They bussed them to the location, assigned them each a regular employee as mentor, gave them all alarm clocks so they would not miss the bus, encouraged them all to work towards perfect attendance and 100% completion (they lost one person when her boyfriend dragged her out of state, I think), had a big graduation party (for people who never finished high school) and have a very high retention rate for these workers, which in the long run means more profits for UPS.
re#3: You invest in ebay? Me to. I think its a pretty good investment in spite of it being the largest "Fencing Operation" in the world. (By its own published statistics it has way more criminal operations (auctions) going on at any given time than even the chicago mob in its prime and its all "legal". I figure "caveat emptor" for the moment. re#2: No, he thinks like a free market capitalist. The drug dealer is a monopolist who not only kills his customers but uses force to prevent competing vendors. (witness Micro$oft) The difference is merely the economy of scale. "What is reprehensible in the small scale is admirable on the large." (Although, I dumped Micro$oft as its business model was no longer viable in my opinion, too many of the addicts stopped buying the product or working for future returns instead of real wages - no complaints on the ROI.) re#7: and UPS doesn't use airplanes, cars or large vans running on petrochemicals? What planet you live on? And the story about the alarm clocks dates from a 1960's novel written about the US automobile industry as I recall.
Jep, would still feel "money made for me will go to the most socially responsible end that can be imagined: making me more wealthy" if you knew your money was funding a company which intentionally targeted and sold addictive drugs in a carcinogenic package to children around the world?
re resp:9: I would not choose to support a tobacco company to make money for myself, if that's what you're asking. If I could have a mutual fund which included a list of companies I am willing to support, those I am not, those I prefer, etc., then I wouldn't allow my money to go to any tobacco companies. I wouldn't pick Coca Cola, either. The mutual funds from which I can pick don't work that way. A couple are "socially responsible", which means they say they follow a list of criteria which sound glowingly pleasant. I don't assume that their choices are necessarily *my* choices. I imagine they're cheerfully funding companies which provide abortions in 3rd world countries, giving preference to companies which fund Greenpeace and PETA, and generally funding activism which I oppose. How about you? Would you pick "socially responsible" if you thought some of the companies were on the list because they did things you strongly opposed?
Re #6: I was wondering about that, too. Are there "socially responsible" funds that focus on, say, a conservative Christian view of what's "responsible"? It seems like there would be a demand for such a thing.
Judging from a quick google on "Christian investment", yes.
funny how "Christian" and "socially responsible" don't seem to be fitting together. lmao@#8
Re: #10 Absolutely. I also voted for my U of M retirement funds to not invest in companies that produce cigarettes. It's very easy to have a social conscience and invest in good stocks and bonds. If you want to.
It ought to be noted that tobacco companies are not doing particularly well especially domestically, and several are going to interesting lengths to try to separate their tobacco & non-tobacco operations. The problem with companies that don't operate in a socially responsible fashion is that sometimes their sins *do* catch up with them.
Quite recently tobacco use was overwhelmingly socially acceptable. It isn't that tobacco companies "sins" have caught up with them, but rather they have moved into new definitions of "sins".
I know some folks who insist on buying their gas from Shell, and have done
so religiously for years, because they consider Shell to be a socially
responsible company. I was startled when they told me that; a lot of
people at the time were boycotting Shell because of their sketchy dealings
with the Nigerian government.
http://www.essentialaction.org/shell/issues.htm
But apparently, Shell was one of the first gas companies to sell unleaded
gasoline, and used to have quite a reputation as a "green" company.
Because we cared about different issues, we had entirely different
impressions of the same company.
re resp:14: I may not have made my question clear. Would you invest in a "socially responsible" fund which you thought might be picking companies who favored things you strongly opposed? You know, Domino's Pizza, Amway, RJR/Nabisco, companies like that? For me, "socially responsible" means "politically inclined against me". The people who seem to me to be most likely to pick something called "socially responsible" are people like you... and, um, I would imagine, in elections of wide enough scope that we both vote, we cancel each other's votes most of the time. I very rarely agree with you on political issues. It's foolish to pick ways to spend your money that are designed to oppose what you want. I would rather pick mutual funds that are neutral, rather than ones selected to go against me. I imagine my point is understood if it's ever going to be.
Nabisco is not socially responsible. The tobacco companies are now trying to addict people in other countries as they lose their market here. There was some political deal whereby China was forced to allow imported American tobacco. I think Korea and Japan are also victims of the tobacco companies.
Sindi, I don't like the tobacco companies either. I've got kids, and I hate the idea of them becoming smokers. I'm not exactly in favor of sending the tobacco companies overseas to attack the children of other countries, either. Struggle with this idea for a bit, just to humor me: imagine that Nabisco does something that really excites those who pick "socially responsible" companies. I'm not going to specify what because this is hypothetical, and you might argue with whatever example I made up. (Nabisco itself is a hypothetical example, and you're arguing with it, so that's why I think that could happen.) Imagine Nabisco does something marvelous and exciting. Then you find your "socially responsible" mutual fund has started buying Nabisco, even though Nabisco is a tobacco company. What would you do at that point? I don't play the "socially responsible investing" game because this sort of thing is pretty likely to happen to me. It's not going to happen with Nabisco, my hypothetical example, but it seems likely that a "socially responsible" fund is going to pick things that are as repugnant to me as Nabisco would be to you. I don't invest to make social statements. I'm not much interested in investing and the stock market anyway, which is why I use mutual funds in the first place. I'd have to get a whole lot more interested than I am to seek out mutual funds which have the right attitude for my preferences. Sigh. I guess as long as someone is willing and able to mis-portray what I say, I'm willing or compelled to explain myself again and again, forever. I wonder if this disorder is treatable.
A socially responsible fund will outline its objectives and strategy in its prospectus. If you agree with these objectives then most of the work is done. The fund manager takes those goals into account with each purchase and keeps an eye on how the company is holding to the funds philosophy. There are funds out there that are only limited in that they won't buy tobacco companies. Not controversial at all, I'd think, to someone who thinks smoking is a bad idea. To a great extent "socially responsible" comes down to avoiding investments in US companies that do to other counties what we don't allow them to do here, at home, for health, safety and environmental reasons.
Actually, I'm just curious what sorts of investments you'd find repugnant, jep. A quick web search shows that the "socially responsible" investments avoid tobacco, arms, nuclear issues, gambling, pollution, animal testing abortion (presumably anti-abortion companies, or perhaps companies that actually have a position on abortion at all). I'm not trying to make a point or set you up, I'm just curious.
Not to put words in jep's mouth, but from his other postings I got the impression that he doesn't see investing as a moral issue, just a way to make money. So it's possible there are no reasonable investments he'd find repugnant. (I'm assuming we're not talking about far-fetched hypothetical cases like 'Bob's Kitten Crushing Machines, Inc.')
Re #22: Actually, if they take an anti-choice position on abortion, I
wouldn't want to support them.
And when you take morality out of making money you're left with what?
I have turned down paid work which I considered immoral, but one time I accidentally accepted a job which turned out to be for a tobacco company. When they paid me, I donated the money to the American Lung Association. I told that translation agency I was not going to do any more tobacco translations. (Previous ones appeared to be anti-tobacco).
thing is, we, as citizens of a capitalist world, can and should decide where our money goes, no matter what we believe. i'm not much of a gambler, and dirt poor, but i do refuse to use certain products and to not spend my money at certain places. it ain't much, but if everybody gave a shit then it would be.
This response has been erased.
Is that because you have something against the Japanese, or east Asians in general, or because you don't want to support the American workers who build cars with Japanese nameplates on them?
This response has been erased.
Re #25: Stock brokers, which are who you're ultimately supporting with *any* investment scheme, have a pretty amoral occupation to begin with. It's hard to see much moral sense in making a living by moving other people's money around. (Note I said "amoral", not "immoral".) Re #30: You'd rather buy a Ford made in Mexico than a Toyota made in the U.S.?
(Nabisco, like Kraft, was bought by a tobacco company that was trying to diversify its products, so that it would not have to go out of business when its only product became illegal, or at least sufficiently unacceptable that its sale could no longer support the company. Blaming Nabisco for RJR's activities is like blaming the horse for the knight's stabbing you.)
This response has been erased.
This response has been erased.
tod, just wondering, if you support US companies that are based in 3rd world countries and pay their workers next to nothing?
Regarding Nabisco, see
http://www.tobacco.neu.edu/tcu/3-4/rjr_split.htm
rjr plans to split food & tobacco, & sell off international operations.
I don't know what Rane means by "recently", but by the early 70's, as a
kid, I was able to tell that however "socially acceptable" smoking was,
it was still a nasty health risk and a bad idea. So I'd have to say
even then they weren't behaving in a "socially responsible" fashion, and
a prudent investor might well have decided to invest elsewhere to avoid
the risk when society decided that wasn't "acceptable" anymore.
It's usually not easy to decide what the future holds, and even in the
present, many large companies display an ambiguous mix of "good" and
"bad" behavior. So, deciding what is "morally responsible" isn't always
easy. It is of course also quite difficult to decide which companies
are going to make lots of money. Still, jep seems to be assuming that
investing in "socially responsible" organizations will worsen his
chances of making money. I think it's more likely there's either no
connection at all between social responsibility and profitability (in
which case, it doesn't hurt you to do this), or, there's even a slight
positive link between social responsibility and profitability (it
certainly doesn't hurt to avoid investing in companies that are about to
get their asses sued off.)
This response has been erased.
I think trying to decide if a major corporations is "good" or "bad" with respect to any particular set of values is very hard. Most engage in such a diverse set of activities. I remember when lots of people were boycotting Exxon after the Valdez incident. Some of them prefered to buy from Shell instead. Shell's oil tankers never spill oil. Shell doesn't have any oil tankers. The oil you buy at Shell stations gets shipped on tankers belonging to other companies. For all I know, might be on Exxon tankers. Whatever tankers they get shipped on, they probably have accidents. I don't see the point in boycotting one oil company in preference for another. If oil spills piss you off, your only effective strategy is to buy less oil.
Canada and Germany are 3rd world countries? Psst. Grex doesn't just pay sun next to nothing, we don't pay sun anything at all. Of course, grex doesn't pay its staff anything either. Stelmar and Mobil (at least) are buying double hulled oil tankers now.
This response has been erased.
How about U.S.-based companies that open shell corporations in other countries to avoid paying taxes?
This response has been erased.
re resp:22: I am in favor of nuclear power, have a neutral position on guns, and a neutral position on animal testing. I am anti-abortion, and against tobacco and gambling.
This response has been erased.
Pack of smokes?
The problem with saying that RJR's activities aren't Nabisco's fault is that at this point Nabsico is RJR. It may well be that the original owners of Nabisco has absolutely nothing to do with tobacco, but the original owners of Nabisco aren't who gets the money when you buy Nabsico products these days.
I don't buy Nabisco anything. What do they sell besides shredded wheat?
Nothing. You're fine.
At least nothing that you'll be apt to buy...
This response has been erased.
I'm not entirely sure I understand the relationship between RJ Reynolds, Philip Morris, Kraft, and Nabisco. But the following food products seem to be involved: a-1 steak sauce altoids cheese nips chips ahoy cool-whip country-time crystal light general foods honey maid jell-o kool-aid kraft life savers lorna doone maxim maxwell house maxwell house coffee miller beer minute rice miracle whip nilla wafers oreo oscar-mayer philadelphia planters nuts post cereal brands (alpha-bits, grape-nuts, honeycomb, raisin bran, shredded wheat) postum ritz snackwells stove top stuffing toblerone triscuit velveeta wheat thins yuban
This response has been erased.
These all sound not much more healthy than tobacco - all based primarily on alcohol, salt, sugar or fat - and possibly equally addictive. What is a yuban or a snackwell or a maxim?
This response has been erased.
I don't think any of these are as unhealthy as tobacco. There isn't any safe way to consume tobacco. Most of the food products could be consumed safely as part of a balanced diet, albeit some of these should not be very large parts. A lot of these do have more than their fair share of salt and/or sugar, fat is over-represented, and a few even have alcohol, but I think shredded wheat and minute rice has none of these, and coffee is low. Beer has some alcohol, but little sugar, less fat, and no salt. I think there's nothing here that has all 4.
I like Grape-Nuts, thank you very much, and I don't think it's that unhealthy =P
"There isn't any safe way to consume tobacco." Sure there is--in a balloon. Same way you can safely consume mass quantities of cocaine. ;)
Maxim? As in the "men's magazine"? Is owned by Nabisco? How odd...
re 57:
And given the number of people who die when those baloons burst, I
hardly think that can be called safe.
Well, if the idiots would remember to remove the air from the balloon before tying it off...
Mass quantities of cocaine may be safely consumed.
Tobacco is used as an insecticide. It causes convulsions.
Maxim is a type of instant coffee.
I think it's nicotine, specifically, that's used as an insecticide. Which may very well be why tobacco plants evolved to produce it.
Insects have convulsions?
Nicotine is a stimulant. Presumably it screws up insect nervous systems in high enough concentrations. It screws up human nervous systems as well, it's just that most people don't eat their cigarettes, but choose other consumption methods that kill less efficiently.
nothing
"Socially Responsible Investing" in the stock market is an oxymoron. Only a moron would invest in the stock market based on being "socially responsible". The purpose of the stock market is to make money. What you personally do with that money after you make it is up to you. I admire charity and practice it personally but I personally think that anyone who practices it as an investment strategy is an idiot - and I encourage such from an investment strategy.
Silly me, and I thought the purpose of a stock exchange was to encourage *investment* and thereby facilitate the creation and expansion of group enterprises.
To make money. Commerce is the goal.
mdw is correct: the purpose of the stock exchange is to raise capital for business ventures. However the stock exchange is then used by others for earning money. The ventures for making money without supporting productive business are called casinos.
I think it is perfectly reasonable for people to have other considerations besides just money. In fact, I think it would be pretty unethical for a person to invest in a company they knew was doing something morally repugnant to them.
Anybody know what the state of day-trading is these days?
Last I heard, the 'close your eyes and stick a pin in the newspaper" stock investment strategy was still pretty good. Of course, everybody likes to think there's more science to it than that.
Yeah, some folk use a trained monkey.
...but it has to be a borrowed monkey.
As one commentator put it, "if market timing worked, we'd all know it, because the person who figured it out would own just about everything by now."
re: "#71 (rcurl): mdw is correct: the purpose of the stock exchange is to raise capital for business ventures..." Which would be the case for initial offerings, but not for the buying & selling of existing shares/bonds held by the public. and: "The ventures for making money without supporting productive business are called casinos." Or, in many areas, public schools (and various other government enterprises).
This response has been erased.
What, is EnRon really selling at 4 cents a share. Heck, buy a 100 or so. YOu can only lose $400, unlike those that bought it first low price of $19/share.
Dunno about the state of Washington. The state of Texas has no income tax (I actually spent some time trying to figure out where to get state tax forms the first year I lived there). They have high sales taxes and do a crappy job of funding their schools, resulting in noticably crappy schools. Sure was nice not having to file a tax return though.
This response has been erased.
klg is, as usual, confused and just shooting off his mouth. Schools and government programs are *non-profit* and are not "ventures for making money".
This response has been erased.
I've heard that Washington's public schools are kind of crappy compared to Michigan's. I have also heard that Washington has dismal public services. Is that a good thing or a bad thing? It's hard to say. Seattle is less of a hole than Detroit but that could have nothing to do with public services or tax rates or whatever. *shrug*
Thank you, Mr. tod. We wonder why Mr. rcurl believes that schools and other so-called governmental and non-profit organizations do not (in his words) "make money." We seem to recall sending significant payments to federal, state, and local governments on an all-too regular basis. Also, when I was employed in a voluntary hospital there seemed to be an obsession with "making money." Perhaps Mr. rcurl does not pay taxes. Perhaps hospitals no longer have that concern. Perhaps we are out of touch.
No, you are out of touch. Of course schools pay their faculty, who are employees carrying out the non-profit functions. But the school makes no profit from this. No one would buy stock from them on the stock exchange as they pay no dividends (and of course don't even issue stock).
This response has been erased.
There is an actual bus service that works from Seattle and north.
Mr. tod. Based on Mr. rcurls analysis (i.e., that the government and its institutions are not interested in making money), we believe we may pay our taxes government bills in seashells. klg
Detroit's schools are really benefitting from that income tax, aren't they? Sorry, couldn't resist. Perhaps what is really needed is an anlysis of revenues versus expenses. Correlating income tax with school success is very shakey, to me.
I meant social services. Sorry I wasnt more clear. The problems with Detroit's schools run deeper than just money, unfortunately.
re 91:
To raise money with any tax, there has to be money to raise. For
Detroit, where the racial segregation (and thus income segregation) boundaries
tend to follow city boundaries, an income tax may well be able to raise more
than a property tax, because an income tax can tax those who commute in from
the suburbs. But that could also hurt the city, since it gives people an
incentive to earn their income in the suburbs rather than in the city, so
Detroit's city income tax can't be very much. If Detroit's tax funding is
limited to sources within Detroit, they're not going to be able to raise much
no matter what they tax.
But the "solution" to the problem in Detroit (and DC which has the highest per pupil spending) is to throw more money at it, right? And where does that money come from? The purpose of a common stock company is two fold, as a force multiplier (business is war) and to distribute risk. Lets say I have 10 dollars with which to buy 10 beads at 1 dollar each to trade with the indians and I think trading with the indians while risky will result in a profit. I can trade my 10 dollars for 10 beads and trade with the indians and get goods which I trade for money for a profit of say 100 cents per year (not bad). I might also get scalped and lose my 10 beads, but I don't really care at that point. However, if I have such a great idea for making money, I convince a million people to buy a million shares of common stock at 10 dollars each, can buy the beads at 10 cents each because of the volume, and pay 100 people to trade the beads for 1 dollars worth of goods where 10 of the hundred are scalped, 90 succeed, build a private army to protect the traders, well, you do the numbers. Lets say I am the holder of on 10 dollar share. I can hold the share and get the now 7 dollar per year profit - greater return on investment (ROI) and no potential loss of life, or I can sell the share now for 12 dollars (double the ROI were I to risk life and try to do the bead deal on the small scale myself) to sombody else willing to wait the full year - who doesn't get the same profit as an IPO investor, but still doesn't risk life. That in the simplest form is the purpose of stocks.
I find it pretty funny that some people see the stock market as a way to make money off unethical businesses while somehow not ending up tainted themselves. Especially people who make a big deal about ethics in other areas.
I think the point the investors in socially responsible funds and/or companies are trying to make is that it is possible to make money by investing in "ethical" companies. (You give a lot away about your bias by using the phrase "make money off".) In the long run you make money by investing in profitable companies. It is a self correcting mechanism and has little to do with social consciousness. You make money dealing with a company that is ethical in that it pays fair money to its suppliers on a timely fashion and gives good value to its customers thus generating a profit.
What's so biased about the phrase "make money off"? I made a lot of money off developing software, and more recently I made a lot of money off selling my house.
I'll leave it as an exercise for the reader.
I had a college prof who used to give that "exercise for the students" line. Didn't take long for me to figure out that he was either too lazy or stupid to come up with an explanation by himself.
Re #95: Well, yes. I mean, the only people who make serious cash in the stock market are the brokers and the insiders who manipulate the stock prices behind the scenes. That's why "ethically responsible" investing is such a belly laugh.
This response has been erased.
I just know what I was told by some friends who live in Seattle. I was told that the schools are much worse than Michigan schools (by someone who has worked in schools in both areas) and that there were fewer social services. Our discussion centered around services for the mentally ill and for children.
This response has been erased.
I have no idea where you get the figure from that link that Washington State spends $23.4 billion on K12 education. The figures I got from that link say that they spent around $10.5 billion with no mention of how many students are in there system. It is possible that I may have been given a skewed perspective but you havent demonstrated that your perspective is any less skewed.
You have several choices: