Investing in Wall Street versus "Locavesting"

Yesterday, I went to Books-a-Million with my friend. My curiosity was piqued when I saw a book titled "Locavesting" in the finance section. When I went home I downloaded a copy of it on my Kindle. Now, as you can probably imagine, it's about investing locally into small businesses and the like. Yes, I get that it's ironic that I didn't buy the book locally but rather on my Kindle, but Books-a-Million isn't exactly local anyways since it's a chain.

In the book, it talks about how people are now starting to eat locally and buy locally, but that we haven't made the crossover to investing locally. My dad pointed out that we want corporations to do well for all of our 401k's and retirement plans, but what that comment really served to do was to make me think there has to be a better way to invest than just sending money to Wall Street and big corporations. It will be interesting to see what some options are in this book. The problem that I foresee, of course, is that the returns won't be as high as in the stock market. It's pretty hard to beat a system that essentially doesn't have to worry about risk since they now know they'll just be bailed out by the government.

When I was in Australia, I listened to a podcast about peer-to-peer lending. This also seems interesting to me as a possible means of investment. To me, using money to help someone else seems a much nobler cause than just sending money to some company that I have no idea what their values really are unless I really research the company. Let's face reality though, hardly anyone researches a company that well, it usually mainly consists of seeing a company's track record of returns to shareholders to know if they're going to be a good investment. What if there was a better way, a more humane way, to invest? There have been some new index funds that deal with companies who are working on renewable and alternative energy types and that's a definite start. Almost everyone knows though that oil almost always will have great returns, but at what cost to our environment?

It will be interesting to see where this book leads, hopefully it will lead to a better way to invest in my local community. It has already mentioned that if people were to spend just 10% of the money they already spend locally as opposed to chain stores that it would have many times that amount of impact on the local economy. I'll keep you updated on what conclusions this book helps me reach.