Snowden Reveals Hidden Risks in US Stocks
By Patrick Watson
Wednesday, 10 Jul 2013
The sheer magnitude of PRISM and the other National Security Agency (NSA) spy programs Edward Snowden revealed is breathtaking. The threats to privacy and civil rights are serious, but they are not the only threats. The economic consequences may ultimately be much worse.
Last week in Secret NSA Deals Cast Doubt On All U.S. Stocks, I explained how U.S. companies are exposing shareholders to undisclosed risks when they cooperate with the NSA. I believe some executives would be guilty of securities fraud if not for secret immunity letters.
Let me say this again because it is important. Executives at publicly traded companies are lying to shareholders and probably their own boards of directors. They are exposing your investments to real, material, hard-dollar losses and not telling you.
The government that allegedly protects you, Mr. Small Investor, knows all this and actually encourages more of it.
Who lies? Ah, there’s the problem. We don’t know. Some people high in the government know. The CEOs themselves and a few of their tech people know. You and I don’t get to know. We just provide the money.
Since we don’t know which CEOs are government-approved liars, the prudent course is to assume all CEOs are government-approved liars. We can no longer give anyone the benefit of the doubt.