An acronym that will someday soon be in your vocabulary is ESG, which stands for Environmental, Social and Governance. 

While each of these words taken individually are benign, taken together they spell danger for the average American citizen down the road, so today I would like to tell you why that is the case.

ESG tries to control the investment world. Whether you realize it or not, much of what becomes available to you as a consumer is the result of high-powered investment firms who invest in the kinds of companies that make the products and services you buy with your hard-earned money.

However, ESG acts as an investment consultant, advising these investment firms about what kinds of companies they should invest in. 

ESG is also a new worldview. ESG advises investment firms in regard to specific kinds of investment risks, and these risks are associated with the three letters of the acronym, namely the environment, social agendas, and governance. Make no mistake about it, though, there simply are no conservative values associated with ESG. Instead, ESG imposes a far Left-wing agenda upon investment firms.

So, what’s driving ESG?  According to MSCI Inc., one of the major players in ESG, the world of money is changing as millennials begin to invest their own monies.  

According to a 2018 survey conducted by Bank of America and Merrill Lynch, some $20 trillion of assets are expected to be invested in ESG approved companies over the course of the next two decades, and much of this is coming from millennials who want to discriminate against companies who don’t share their progressive values.

ESG discriminates against companies with traditional values. ESG evaluates companies based upon their level of threat to the environment, their resistance to social change, their degree of ethnic integration, and their compliance with governmental regulations. 

As MSCI Inc. says, “Companies face rising complexities and greater scrutiny if they are not adequately managing their ESG or climate risk.”

So, why should I care? Right now, ESG is neither a household term nor does it effect the average consumer, but the day is fast approaching when it will. 

Right now, ESG is in the business of rating companies based upon their compliance to ESG standards for investment firms; however, you should expect this trend to apply to consumers as well down the road.  Imagine applying for a mortgage loan but being denied because your ESG rating does not comply with the industry’s social standard.  

Because ESG is being driven by a radicalized progressive worldview, many of the products and services that you enjoy today may soon be taken off the shelves or made unavailable to the public. Imagine McDonald’s Big Macs being replaced by veggie burgers, Chevy trucks being replaced by electric El Camino cars, and air conditioning units being replaced by electric fans. These are exactly the kinds of products that ESG prefers to invest in.

If there is any good news about ESG investing, it is the fact that ESG companies have been underperforming in the stock market and trading at bloated values. For example, on Oct. 29, 2021, MSCI Inc. was trading at $664.88 per share, but by June 17, 2022, the stock had fallen to $386.71 per share.  To the contrary, investment portfolios which stress the traditional market-driven approach to investing have been performing much better. So, ESG investing does not make good sense for investing if the goal is to make money in the stock market. ESG principles simply do not work well in a capitalistic system.      

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