An old Chinese tale goes that a scholar traveling to a foreign country has not eaten for days, and is dying of hunger. He comes across a gang in the boondocks, and one of the guys feeds him a bowl of rice. Then he finds out that they are bandits.
"I'd rather die than eat the food of a thief," he says as he vomits and passes out.
When it comes down to begging, it is best not to be picky. Andrew Leonard of Salon.com wrote of a certain fear among Wall Streeters about the recent mass injection of capital from foreign sovereign funds to bail out the banks under the subprime crisis. Observers from the left and the right are skeptical about foreign governments owning a piece of their crucial financial institutions especially when the operation of some of these funds are not so transparent, Leonard explained.
Morgan Stanley (MS) and Bear Stearns (BSC) both received injections from China, a country whose government operations Americans often scrutinize. But perhaps when a man is hungry, he lays down his pride and stands in line, hat in hand. Money is money, and when you need it, you need it.
In a later article, Leonard mentions a sovereign fund that actually gives a rat about ethics and social responsibility. Surprise, surprise, it's a Scandinavian country. The Norwegian sovereign wealth fund decided to sell their Wal-Mart (WMT – $47.85). shares because of Wal-Mart's violations of workers' rights. The details of the alleged violations are stated on their website. Reuters reports that the fund is also considering excluding investment on production of tobacco, gambling and sex industries.
The general consumer taste of the Chinese and Scandinavians differ from each other, in that China tends to value price over quality, and Scandinavia seem to tend towards quality over price. This is arguably a fundamental cultural difference rather than a question of ethics.
Then there are people who cash in on the crisis like John Paulson, and those like Alan Greenspan who tag along. These are the sharks.
It is often said that a disaster reveals the real faces of people. And so it does.
Disclosure: I do not own shares of Wal-Mart, Morgan Stanley or Bear Stearns, nor am I connected in any way to John Paulson' hedge fund or in any of the sovereign funds mentioned above.