Letters to the Editor

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Now that I am ready to start investing, I want to find out if my money can grow in green fields.
  • not exactly

    A check on the claims of green investing, and the concerns of investors: buying stock (or doing so indirectly via a fund), except in the case of an IPO, does not give that company any money. You're buying shares from some other shmo who's selling, that's all.

    (When companies need extra money, they usually go to a bank for a loan. Stocks are just a way of dividing up ownership of the economy with very, very fine granularity.)

    There's an argument to be made that a high valuation gives a company some leverage, but that's limited. A high share price is more likely to follow from a company's strength than the other way around. Likewise, a high valuation in itself guarantees a company (and it's "investors") nothing.

    Bonds are somewhat different, since they represent loans to companies. Though bond trading also takes place after the bond's terms are set, green investing has a more realistic claim to make there. To be more direct still, there are community development banks which use investor deposits to make loans screened for community needs and green principles.