Why Do Good People Invest in Bad Companies? A Robin Hood Redux Explaining Meme Stocks
Meme stocks have pitted heroes against villains over good and bad companies
I was recently asked by a student if I could review a short essay she wrote. It was for a first-round interview for a summer internship at an investment firm. I was intrigued by one of the questions: “Is XYZ a good or bad company? Why?” I’m not a philosopher, but it got me thinking: what do we really mean by a good or bad company? And I imagine that was the point — to make you think.
Around this time a reporter reached out asking my view on what was happening Tupperware’s stock price, “which has been on a wild tear recently.” Tupperware’s stock price had increased by over 500 percent in the past 10 days. Yet by the company’s own admission a few months earlier, there was “substantial doubt” that it would stay afloat. Wasn’t Tupperware clearly a “bad” company? What investor would be crazy enough to invest in it? And if they did, were they “bad” as well?
Tupperware: Let’s party!
First, some brief Tupperware history. It was founded in 1946 by Early Tupper. The main product was cutting-edge polyethylene plastic containers used for food storage. Brownie Wise, Vice President of Marketing, brilliantly created the at-home Tupperware…
