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L. Neil Smith's
Number 524, June 21, 2009


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Divestment Works
by Jim Davidson

Special to The Libertarian Enterprise

When I met Rick Maybury in July 2000 he was speaking at the world congress of the International Society for Individual Liberty. If you haven't been to one, you should make plans to visit Panama next Summer. Sandy Sandfort and I are putting one together, and I think it'll be a lot of fun.

Naturally, I was impressed by Rick. He's sincere and principled. I very much like his two laws. They are simple and easy to remember. Law one, do all you say you'll do. Law two, don't trespass on anyone else's person or property.

The world would indeed be a much better place if everyone adhered to these two laws. I think they are brief and well-stated, and that they represent ideas with which many cultures are in agreement. Though, since mankind have had 14,000 wars in the years between 3600 BC and AD 1984, and quite a few since then, it seems that agreement with good ideas is a long way from implementation.

Rick is also very insightful. I really want to like this guy, because he's bright, witty, and skeptical. He knows all about the fraud of the Federal Reserve system. He knows that the system only has two choices—inflate like crazy and try to make some bubbles, or avoid inflation entirely and let the economy go through a real adjustment to get all the malinvestment out of the way. The middle ground, tried by Japan in the 1990s, won't work.

His idea of looking for investment cones or bubbles is quite good. Bernoulli would certainly like this guy's approach to mathematics. There is clearly the same thing going on when investors seek out cones and when a clipper ship adjusts its sails to the wind.

But there is a great huge rhinoceros turd in the living room. Here's an example from his newsletter back when I still subscribed. March 2006 he writes, "I first suggested Magal Security Systems (MAGS, Nas) in 1996 at $8. ... I still like it." This example is not meant to convey any of Mr. Maybury's current investment advice, since it is from 2006. My suspicion is that, at $4.27, even after some splits of the 105:100 sort, it isn't that good a deal right now. Maybe he still likes it. But what do they do? They make security systems for the military. And they are only one of the military contractor companies which he's recommended. I make the direct quote for the purpose of verisimilitude—I am not making up the idea that he's pushing military contractor, also known as death merchant stocks.

He is. And he's not changed his tune in many years. He's not only pushing death merchant stocks, he's proud of it. He thinks it is a brilliant idea.

My concern, of course, is that the military is slaughtering civilians all over the world. MAGS is an Israeli military contractor, too, and the Israelis have been quite aggressive about slaughtering unarmed non-combatants in the Gaza strip, and elsewhere.

I think investing in defense stocks is a terrible idea. Try gold or silver for physical delivery if you want a good deal with high return, low risk, and no danger of having blood on your hands. Or invest in education—a great many people are going to need to upgrade their skills in this economic depression as they look for work. Buy a farm and grow some food—there's always a big market for food when people are starving.

The problem with investing in death merchants is, you get death with every dividend. When you invest in the military, you signify your desire for more of it. If enough people invest, you get more of it. And there are no clean wars. There are no wars without collateral casualties.

These wars in Iraq, Afghanistan, Somalia, and elsewhere have brought not only death and destruction, but direct assaults on American civil liberties. Investing in defense stocks is a way of saying, "I like the fact that the military contractors help the military and the CIA torture prisoners to death. I want less freedom and more authoritarian government."

It is madness. Rick Maybury ought to be ashamed. He is wrong, dead wrong.

The answer is to divest. Stop investing in the military. Withhold your support. Don't send your children into the military. Stop investing in the death merchants. Sell your defense contractor stocks. Resolve never to buy them again.

Divestment worked for the civil rights movement in the 1960s. Americans stopped investing in companies that supported the Jim Crow system of racial discrimination. Companies got the picture, and stopped being racist, or went under.

Divestment worked for the anti-apartheid movement in the 1980s. Americans and people around the world stopped investing in South African companies, and in those doing business there. The South African government ended its racist policies.

Divestment works. So, stop investing in evil. You want fewer wars this century, stop investing in military contractor companies. You want fewer death camps this century, stop investing in companies that support the current authoritarian regime. Put your money where your philosophy is.

Do it now.

Jim Davidson is a sovereign individual who writes extensively on topics ranging from individual liberty to nanotechnology. He is an entrepreneur with extensive experience in space tourism, online sales, medical practice management, real estate, port development, toll road development, and education. He is currently working on an initial public offering for a computer company and a massively multiplayer online gaming project. He also markets gold and silver to individual seeking to hedge against inflation. Please visit one of his sites, such as,, or


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