So, the NY Times Joe Nocera (as well as Henry Blodget) think that the investment bankers scammed LinkedIn’s owners in favor of the investment bankers other customers.

Grand conspiracy theories – as well as criminal prosecutions – certainly have been hatched with less.

But as the Epicurean Dealmaker lucidly explains (also here), morality plays and conspiracy theories are hard to piece together given the wide variety of forces that are in play when owners of a company tap the public markets with a piece of their company. Heck, LinkedIn’s shares are trading at a massive multiple to what they traded for recently in private in secondary markets.

The instinct of most politicians and much of the mainstream media is to embrace simple “villain and victim” morality plays when attempting to explain a particular outcome in which someone gained at the expense of someone else.

Take, for example, investment loss. The more nuanced story about the financial decisions that underlie a failed investment strategy doesn’t garner sufficient votes or sell enough newspapers to generate much interest from the demagogues or muckrakers. That’s why we periodically endure witch hunts — such as demonizing speculators – when it’s unquestionable that speculation in markets has a beneficial purpose.

Morality plays are comforting because they make it easy to identify and demonize the villains who are supposedly responsible for trouble. The truth is usually far more nuanced and complicated, but ultimately more rewarding to embrace.