Matt Levine has repeatedly brought up the idea that everything bad that happens at companies is securities fraud. And there are a lot of real lawsuits along these lines. Here it is again, yesterday, with many links:
Everything is securities fraud
You know the drill. A public company does a bad thing. When the bad thing becomes public, the company’s stock goes down. Shareholders sue the company for securities fraud. The lawsuits are always the same: “You told us in your public filings that you were not doing a bad thing, so we bought your stock. But you were lying, and when the world found out you were doing the bad thing, the stock went down and we lost money. We were defrauded out of our money by your lies.” Everything bad — polluting, sexual harassment, animal abuse, making a buggy video game, social media companies failing to safeguard user privacy, social media companies having a negative effect on society, lax information security practices leading to data breaches — can also be characterized as securities fraud, if a public company does it.
This is highly relevant to the idea of “only” prohibiting force, including fraud, and thinking that’s a tiny government. “Fraud” may be a really big category.