Abstract (EN)

Regulating Trusts’ investing has long been used by legislatures to finance state activities. In the 19th century, the legal concept of prudence led trustees to invest in State bonds, sometimes in railroads securities favoured by politicians. Stocks were generally prohibited since considered too risky. These rules were both justified by the specific protection due to the Trust’s beneficiary and useful for the economic development of the community. So, the moral purpose of the Trust (protecting weak persons) was achieved by benefiting the whole community (financing infrastructure, utilities).This virtuous nexus has been revisited by federal statutes in the 20th century. During the New Deal, the securities laws tended to improve the market functioning. In the 1960s-70s, stock market was rehabilitated. The idea of financing welfare through private pension and health plans managed by financial intermediaries was articulated with the idea that this new actors were capable of allocating assets in the right direction which would boost the American economy. Finance was given two duties: financing welfare and directing the economy. Some sponsors of the new concept of “responsible investment” yet began to add to this virtuous picture another requirement: institutional investing was not to hurt the community. In the 2000s, academics launched the concept of the “universal owners”. Those are large institutional investors with large diversified portfolios holding the entire economy. They should be consequently in charge of the economic future of the USA. They should act like politicians, worried about industrial policies.So, finance and politics have experienced a long history in the USA. The quasi moral duty of finance, and the virtuous nexus which is associated with, has been dramatically challenged by the duty to diversify and the Modern Portfolio Theory. By the 1960s, this new definition of diversification was attacked by traditional financial practitioners as “un-american” since it was supposed to undermine the responsibility of the financiers, place the market above all and deny the free will. The new paradigm seemed to condemn any attempt to politicize investing.I will explore the context, conditions and actors of this battle which opposed conflicting conceptions of investing during the 1960s-70s. The main question is why and how economic actors (corporate managers, financial practitioners, regulators and courts) have changed their mind and finally agreed with these “un-american” practices.