Fri 21 Jul 2006
In case anyone caught last night’s Daily Show, Samantha Bee interviewed a guy named Kevin Kerr in her segment called Hurri-Cash. She mocked Kerr (a commodities trader) and a guy who runs a gambling website for profiting and being excited when hurricanes hit and cause devistation.
To be honest, the piece didn’t mock Kerr as much as the situation in general. The funny thing is, I’ve read Kerr’s work in the past and he is (as portrayed) very market oriented… You can read The Daily Reckoning or Investment U, both of which he sporadically contributes to.
The Daily Show implies this question though — is it ok to profit when others are in distress like in a natural disaster?
July 21st, 2006 at 8:06 am
My opinion is that we have to choose to invest based on reality, and take negative consequences into consideration. I certainly don’t hope that a hurricane will hit New Orleans, but I’m not going to hope that one won’t and ignore the potential to profit from reconstruction or other imbalances in supply and demand. Am I profiteering if I buy insurance for property in harms way? Of course not. Yet it is possible that I would profit from the destruction of my property…
That’s just reality. I choose to invest (and buy insurance) based on reality and probability rather than hope. Hope is not a strategy.
Oh, and don’t make an ass out of yourself by mentioning on one of your blog posts that you’re “really looking for some hurricanes to hit” to make your trade work. That’s just poor taste.
July 21st, 2006 at 9:19 am
I think it comes down to a simple litmus test: are you profiting because you understand the dynamics of the situation and what it will mean for your investments (like you do any investment) or are you profiting to take advantage of and further injure those already hurt by it? Your trading in most cases isn’t going to harm anyone nor is it going to help. It is completely removed from the situation and it doesn’t prevent you from taking normal paths of charity if you wish. If make a trade that might be driven by a tragic event, someone else is making the opposite trade. Would Bee’s logic then mean that that person was helping the injured? Certainly not and so it’s just as silly to say anything derogatory about the other side of the trade.