free4now
Thinks s/he gets paid by the post
- Joined
- Dec 28, 2005
- Messages
- 1,228
I wonder how much of the returns that we get from stocks and bonds are a result of the externalized costs that our companies cause to the world at large.
The classic externalized cost is environmental pollution. If my company dumps toxics that will cost 10 million to clean up and then fail to spend that money on cleanup then they get a competitive advantage. That increases my return at the expense of the taxpayers who end up cleaning it up. Perhaps the increase is only 1 million in toxic dumping fees saved.
There aren't of course exact figures since this isn't tracked with anything approaching precision. I am interested in people's gut estimates. Say the long term rate of stocks is 10%. Is the externalized costs on the order of 1% or 5%?
Sent from my iPhone using Early Retirement Forum
The classic externalized cost is environmental pollution. If my company dumps toxics that will cost 10 million to clean up and then fail to spend that money on cleanup then they get a competitive advantage. That increases my return at the expense of the taxpayers who end up cleaning it up. Perhaps the increase is only 1 million in toxic dumping fees saved.
There aren't of course exact figures since this isn't tracked with anything approaching precision. I am interested in people's gut estimates. Say the long term rate of stocks is 10%. Is the externalized costs on the order of 1% or 5%?
Sent from my iPhone using Early Retirement Forum