In a recent post, I quoted Samuel Adams as saying,
Among the natural rights of the colonists are these: First a right to life, secondly to liberty, and thirdly to property; together with the right to defend them in the best manner they can.
What is the nature of private property ownership? Ownership means having the economic consequences of that property and being the arbiter of decisions regarding its use. That is why I have never really focused on the distinction between "activist" investing and other types of investing. When I own something, I act like it. I expect a return of my capital whenever its managers/caretakers are unable to produce a return on that capital in excess of what I can get on it without them. I supply the ideas as well as the money that are intrinsic to responsible ownership.
I have never understood why it is "greed" to want to keep the money you have earned but not greed to want to take somebody else's money.
Private property should (almost) always be respected. But what should be the limits of private property? If it is, as Adams claimed, a natural right, then it is an end good, intrinsically valuable, and not contingent. There are only three categories that I have observed in my own life where private property gets little respect. The first is from one's kids. To say that my 1-7 year olds mess with my stuff is an understatement. More accurately, I don't think that I ever see something of mine in the same place twice simply because 1) it is mine and 2) I left it there. My iPad is cluttered with countless games and aps. I can't remember my passwords. They can.
The second category is food and drinks. People are constantly eating my food and drinking my drinks. This is totally decoupled from the social rules that govern anything else. Few friends would just walk in uninvited and take a crystal glass from the pantry and carry it off, but few friends (of mine, at least) would decline to walk in uninvited and fill that same glass up with at least as much value worth of booze. This is not a complaint; just an observation. Of course when it comes to the combination of kids and food, then private property rights are utterly hopeless. I get the blankest stares from comments such as "I was saving that" from 2-4 foot tall boys stuffing their faces. While the locksmith is scheduled to change the locks on their eighteenth birthdays, it is unclear that such measures will change anything. They know how to pick locks (one of the more questionable lessons they have learned).
Rangeley Capital, the hedge fund that I founded eight years ago, is probably one of the world's most secluded. When we built our Maine office, we had to lay down over four miles of cable just for the internet hook up. In the extreme winter climate, we are more forgiving about people taking wood and even food if necessary for survival. It is not too common, but every once in a while a neighbor will find some wood or food missing, often with some money left as compensation. But when the alternative at 30 degrees below zero can be a well preserved corpse in the spring, we are more forgiving about missing a few pieces of wood or cans of beans. On the coast, it is not too unusual for someone to take a lobster or two from a fisherman's pod; the custom is to replace it with a bottle of whiskey or wine in payment.
Each exception comes with an implied contract and reciprocity. The kids don't have much money anyway (I'll settle up their bills later when I kick them out), I steal my friends' food and drinks too, and it is nice to help each other through long winters. If you ever need any firewood or food, I'll leave some on the side porch. But if you steal anyone's firewood in Maine, make sure the chill equivalent is under 30 below (or make sure you are faster than buckshot).