This interview with Charles Sandmel, a veteran of the municipal bond market, gives us some insights into current trends in the ethical investing movement. Some key points:

The leading market sectors over the last few years are in areas that “most of them [ethical investors] avoid, such as energy.”Ethical investors don’t buy “Big Oil because of the pollution problems.”Examples of ethical investments: wind turbine farms and facilities.Examples of unethical investments: government bonds for nations with standing armies.Sandmel likes bond funds for ethical investors because “going to panies that are borrowing gives you a much greater chance to engage them on your social issues than simply buying their stock.”

Mark Cuban, billionaire owner of the Dallas Mavericks, opines on his blog about the difference between “investing” and “speculating.” He says, “The difference between the two is very simple. If you spend the money and the only way you can earn a return on that money is by selling whatever it is you have purchased. You are speculating.”

With respect to buying bonds, Cuban writes:

If you give your money to a mutual fund or hedge fund that puts money into public stocks and bonds, that’s super speculation.

Why Super Speculation? Because there is a 99 pct certainty that you are 3rd in line to get paid with whatever earnings the fund generates with your money.

First the fund itself has to get paid. They take money off the top.

Then the person who makes the investment decision has to be concerned about keeping their job. You see if the fund doesn’t outperform its peers p indexes, then the person who is responsible for the fund is out of a job.

Do you think that person cares more about putting a roof over his family’s head or you? Which means when es to shove, unless there are strict limitations, that fund manager is going to take the chances necessary to outperform ps. And I can tell you that its par for the course to “go down swinging” than it is to take a called 3rd strike. Meaning, they risk your capital in hopes of keeping their jobs if that’s the only way to keep their jobs.

For Cuban, the “the problem is when the balance between the two shifts from heavy in investing to heavy in speculation.” This is because an emphasis on the former, “when money goes to merce, that’s capitalism at its best. Money going to smart people to do smart things. If it has good results, everyone makes money. The economy grows. Expectations are based on the prosperity of pany, typically over a longer term. New ideas create new wealth. It’s not a zero sum game. It can be an everyone wins game.”

But when there’s an emphasis on the latter, and while “speculation isn’t a bad thing. It can serve many purposes,” even so “it primarily just results in redistribution of wealth. If I speculate better than you, even if you are investing in apples and me in oranges, then its just a contest to see who does a better job. The winner gets the cash. Across all the different levels of speculation, the trillions of dollars, its a zero sum game.”