When Political Dogma Poses as Investment Strategy
When Political Dogma Poses as Investment Strategy
In which the anti-woke brigade set its sights on investment methodologies
The other day I had a brief Twitter exchange with Mark Dow, a global macro trader. According to his profile on Business Insider, he was previously an economist at the U.S. Treasury Department and the International Monetary Fund.
The catalyst for Dow’s tweet was an Andrew Ross Sorkin interview with Ramaswamy on CNBC’s Squawk Box. Something Ramaswamy said during the interview triggered the following reaction from Dow:
Since I left the business over a decade ago, I rarely watch Squawk Box. That said, I still record every episode, if for no other reason than as an occasional trip down memory lane. So I queued up the latest episode and fast-forwarded to Ramaswamy’s interview to see what was up.
For the unfamiliar, Vivek Ramaswamy is an ex-biotech entrepreneur turned asset manager. He’s also the author of Woke, Inc.: Inside Corporate America’s Social Justice Scam. It’s fair to say that he’s the influencer du jour among a rising tide of anti-anti-racism and anti-woke crusaders.
He and others in this nascent movement think asset managers — BlackRock, Vanguard, and State Street specifically — push “woke” investment methodologies like ESG, which favors green technologies. According to Ramaswamy, they’re forcing their liberal ideology on defenseless investors. Conveniently, he’s here to save the world from Wall Street liberalism gone wild.
Don’t get me wrong; there are plenty of reasons for concern regarding the power the so-called “Big Three” investment funds wield on behalf of their clients. But being too “woke” ain’t one of them.
This summer, Vanguard became the largest holder of 330 stocks in the S&P 500 — nearly 70% of the index. BlackRock, the world’s largest asset management company, manages over $8 trillion in client assets. But the idea that they’re part of some woke cabal? Come on.
That said, Ohio-born Ramaswamy sings the song many on the right want to hear. As an East Asian American, his status as a person of color makes him a valuable asset in the diversity-challenged Republican ecosystem. That he also rails against “identity politics” is music to GOP (read MAGA) ears.
Indeed, there is a lucrative market on the right for persons of color with conservative leanings. The ascendency of Candace Owens within the Republican media hierarchy is a prime example of what I call “the diversity arbitrage.”
A couple of years before switching to the conservative team, Owens, whose husband George Farmer is the CEO of Parler, the far-right social media company, was on the other side of the political spectrum, running a Trump-bashing publication.
Unlike Owens, the Harvard-educated Ramaswamy’s carefully packaged message of anti-wokeness-as-investment-strategy allows him to play to both CNBC and CPAC audiences.
He’s all the rage in the conservative media circuit, with regular appearances on Fox News, Fox Business, and right-leaning CNBC. This summer, he appeared at CPAC’s annual meeting alongside Steve Bannon and Viktor Orban, the authoritarian prime minister of Hungary.