The Great Investor Delusion: How to Stop Lying to Yourself About Corporate Ethics
A Guide for Analysts, Investors, and Other Self-Deceiving Capitalists—Tread Cautiously
Welcome to Capitalism: Where Ethics Are Optional
Let’s be honest—corporate profits and ethics go together like oil and water. If you’re an investor or analyst who thinks otherwise, you might as well believe in unicorns running hedge funds.
The financial world isn’t built to reward morality. It’s built to maximize returns, often at the expense of workers, consumers, and even entire economies. Your job isn’t to be a moral philosopher—it’s to make money. But that doesn’t mean you have to be willfully blind to the realities of capitalism. You’re probably closer to the Wolf of Wall Street, minus the yacht (unless you really know what you’re doing).
But don’t worry, this isn’t about making you feel guilty (okay, maybe just a little). It’s about understanding the system for what it really is and making smarter, more honest decisions.
From “Rich Dad, Poor Dad” to “Moral Crisis, Existential Dread”
Like many naïve optimists, I once believed capitalism could be fair. Then I started working in finance.
It didn’t take long to realize that Wall Street operates with the ethical flexibility of a used car salesman at the end of the month. Banks charge small businesses interest rates high enough to make loan sharks blush. Wealth management firms collect fat fees regardless of whether they make you richer or just slightly poorer at a more sophisticated level.
One banker I knew put it bluntly:
“We’re in the business of making our customers poorer, not richer.”
Refreshing honesty, right? Almost makes you want to hug him.
This moral dilemma is nothing new. Benjamin Graham, the father of value investing, was drawn to finance after watching his family lose everything. Steve Carell’s character in The Big Short portrays the real-life frustration of knowing the system is broken but still playing the game to win.
Financial Ratings: The Biggest Scam You’re Still Falling For
If you thought ratings agencies like Moody’s had your back, think again.
Remember the 2008 financial crisis? The one caused by garbage mortgage securities being labeled as pristine AAA investments? Yeah, those same rating agencies are still running the show.
Even Warren Buffett—yes, the Warren Buffett—owns a big stake in Moody’s. Because let’s face it: If the system is rigged but profitable, why change it?
And it’s not just ancient history. In 2015, banks sold 100-year bonds from Petrobras and ArcelorMittal, knowing full well these companies were about as stable as a Jenga tower in an earthquake. Investors lost 80% of their money. The banks, of course, walked away with millions in fees and a well-practiced look of surprise.
If you’re still trusting credit ratings at face value, you might as well invest in magic beans.
Crypto, Deregulation, and the Never-Ending Cycle of Financial Disasters
Remember when banks dismissed cryptocurrency as a joke? Fast forward a few years, and now JPMorgan and other institutions are all in. What changed? Nothing—except they found a way to make money from it.
Meanwhile, Trump’s deregulation spree has made financial oversight about as effective as a screen door on a submarine. The 2018 rollback of Dodd-Frank removed key banking regulations designed to prevent another 2008-style collapse.
And what happened next?
Silicon Valley Bank (poof, gone)
Signature Bank (poof, gone)
Silvergate Capital (poof, gone)
Some critics blame these failures on Trump’s deregulation. Others say the Fed’s stress tests wouldn’t have caught these collapses anyway. But here’s what we do know: Every time regulations get stripped away, things break, and regular investors pay the price while bankers cash out.
Now, with Trump back in power, the Fed is easing restrictions on Wells Fargo, a bank famous for fraudulent accounts and mortgage mismanagement. Shares of Wells Fargo have surged nearly 43% in 2024—because, of course, when banks get caught doing something shady, the market rewards them.
But sure, deregulation is definitely about “helping the little guy.”
Tech Giants: Profits, Privacy Violations, and Psychological Warfare
If you invest in major tech firms, you might want to ask yourself some tough questions:
Did Facebook (sorry, Meta) profit while fueling genocide and spreading misinformation? Yep.
Did Instagram help drive a teen mental health crisis? Sure did.
Has Google ever exploited your data while pretending to care about privacy? Do you even have to ask?
Meta (formerly Facebook) flourished under Trump’s administration, only to face tougher restrictions under Biden. Meanwhile, Google has been caught in endless scandals—data breaches, anti-competitive behavior, privacy violations—but as long as their stock price rises, few investors seem to care. And they are all back in business now.
In 2006 and 2007, Fannie Mae and Freddie Mac tried to win back market share by making terrible investment decisions. They increased their leverage and bought subprime securities that were wrongly labeled low-risk. The result? A financial disaster.
And yet, billionaire investors like Bill Ackman still lobby for policy changes that benefit these giant institutions at the expense of public accountability. Because why fix a system when you can just bet against it?
How to Stop Lying to Yourself as an Investor
Since I’m not just here to ruin your day, let’s talk solutions. No, you can’t single-handedly fix capitalism (unless you become the next Elon Musk, in which case, please use your powers wisely). But you can invest more responsibly.
1. Investigate Revenue Sources
Before you celebrate a company’s record profits, ask yourself: Where is this money actually coming from? If the answer involves exploitative labor, environmental destruction, or psychological manipulation, maybe reconsider or at least report it as it is.
2. Demand Corporate Accountability
Don’t just nod along to whatever nonsense the CEO says on earnings calls. Ask hard questions. Challenge executives. They hate that.
3. Support ESG Investing—For Real This Time
Environmental, Social, and Governance (ESG) investing is often just marketing fluff, but if done right, it can actually push companies to do better. Just don’t fall for greenwashing. Do not become a party to human rights abuses.
4. Vote With Your Shares
Use shareholder activism to push for ethical reforms. If you own stock, you have a say—so make some noise.
5. Stop Believing in Deregulation Fairy Tales
Regulations exist for a reason: to prevent financial meltdowns. Every time someone tells you that “cutting red tape” will help the economy, remember that it usually means “helping corporations make more money while screwing over everyone else.”
And Finally, If Buffett Is Sitting on $325B, What Should That Tell You?
Invest Like Buffett—With Caution, Not FOMO
Take a page out of Warren Buffett’s book: He’s sitting on $325 billion+ in cash while others gamble on speculative nonsense. Why? Because Buffett understands Rule #1 of investing: Don’t lose money.
So, before you get swept up in the next “big thing,” slow down, look deeper, and tread cautiously.
Warren Buffett isn’t holding onto hundreds of billions in cash because he’s scared. He’s doing it because he knows the market is overheated trading close to a P/E of 30, full of speculation, and due for a reckoning.
Meanwhile, countless investors are chasing the next big thing, ignoring risk, and lying to themselves about how capitalism really works.
So, dear analysts and investors, ask yourselves:
Are you playing the long game like Buffett or gambling on hype?
Are you making decisions based on fundamentals or just FOMO?
Are you really making ethical investment choices, reporting as it is or just telling yourself a comforting lie?
Conclusion:
Are You Ready to Face Reality?
At the end of the day, capitalism isn’t going to fix itself. But that doesn’t mean you have to be complicit in every shady practice out there.
Your money, your call. Just don’t say you weren’t warned.
Disclaimer (Because Lawyers Exist)
The views and opinions expressed in this article are solely my own and do not reflect the stance of any organization, employer, or affiliated entity. This content is intended for informational and discussion purposes only and should not be considered financial, legal, or investment advice.
Investing involves risks, including the potential loss of principal. Past performance is not indicative of future results. Readers should conduct their own due diligence, assess their individual financial situations, and consult with a qualified financial professional before making any investment decisions.
Any examples, references to financial events, or critiques of corporate practices are used to illustrate broader themes and are not exhaustive analyses of the entities involved. The financial markets, regulatory landscape, and ethical standards are constantly evolving, and the information provided may become outdated or subject to change.
The author may own or have financial interests in some of the stocks, companies, or assets mentioned in this article. However, any references to specific investments are purely for illustrative purposes and should not be interpreted as a recommendation to buy, sell, or hold any security.
The author assumes no responsibility or liability for any decisions made based on the content of this article. Investing is a personal decision, and you are responsible for your own financial choices.