Gun Stocks Resilient as Pressures Build
Some large investors are not willing to wait for tighter background checks or other restrictions on gun sales, but are instead unloading their shares of weapons stocks.
The New York City Comptroller John Liu on Wednesday announced that the city's pension plan had divested of its weapons-related stocks, following a trend that began immediately after the Dec. 14 Newtown shooting that left 20 children and six others dead. TheStreet's Antoine Gara outlined the threat to weapons and ammunitions stocks from such public pressure in an article Dec. 19.
Gara pointed out how state pension funds were a vulnerable point for weapons stocks. As Gara reported, California Treasurer Bill Lockyer asked his state's pension funds to dispose of their weapons-related investments, specifically those making weapons that are illegal under California law. The list included three funds run by private equity firm Cerberus Capital Management that owned stakes in Freedom Group, in turn the owners of Remington and Bushmaster brands, among others.
Reacting to the shooting and the California pressure, Cerebrus announced on Dec. 18 it was selling off Freedom Group. The firm said in a statement, "It is apparent that the Sandy Hook tragedy was a watershed event that has raised the national debate on gun control to an unprecedented level."
While weapon manufacturers Sturm Ruger
Wednesday's move by the New York City Employees' Retirement System translates into the sale of over $16 million in shares, divided between holdings in ammunition makers Alliant Techsystems
Quoted in the city's press release, NYCERS trustee Lillian Roberts said, "Guns are responsible for two-thirds of the nation's murders and kill more than 30,000 people per year. Gun violence costs the U.S. one hundred billion dollars annually. This action by NYCERS will send a message to the gun industry that their products are not an acceptable investment for NYCERS' members and retirees."