Is Investing in Stocks, Mutual Funds, Equities wrong or sinful? If not, what are the pitfalls and grey areas? This could easily be extended to Cryptocurrencies and other investment tools.

Very insightful! During the times of the Bible, taking interest on a loan was actually a sin. The reasons for this are complex, but are closely related to the way that money and its purpose in society were understood at that time. At its core, the reason that interest on a loan used to be considered sinful was because a loan was understood to be something “final.” If you lent ten gold pieces to your neighbor, he guaranteed he would pay it back. He might offer some kind of collateral or return the payment in installments, but the money would eventually be back in your hands. If the money was not returned, you enjoyed a lot of rights under the law. For instance, you could mandate that your neighbor be pressed into some form of service for you until the debt was repaid (we see this used in parables in the New Testament). All this was to say that charging interest was seen as something particularly greedy and selfish. Your neighbor was already guaranteed to pay you back; why would you want to profit off of a neighbor in need by demanding in return more than what he asked of you? Interest was seen as a form of cheating or extortion.

For a long time, this idea of “making money off of money” was treated with resistance by the Church. Well into the Middle Ages, jobs which worked closely with money like banking were viewed with suspicion by many members of society. This changed with the rise of modern-day capitalist economics because the ways that society understood and utilized money evolved. Nowadays, “working with money” is a skill in its own right which is entitled to a fair wage. The idea of paying interest is that you are compensating the bank (a company of individual employees) for the labor that is required of them to properly secure your money. Of course, there are plenty of examples of banks demanding unfair fees… and you don’t have to be a saint to know that those aren’t right!

The Church condemns unjust practices like bribery or extortion outright. With the practices mentioned in your question about investments, though, there is no straightforward answer. Money and property are goods to which each person has a right; however, the only reason we have a right to money and property is because they are at the service of higher goods. We don’t make money simply to get rich; we make money to provide for our families, our communities, and the larger world. Money is at the service of the common good. While there is no shame in making more money, if acquiring more money means that you are personally withholding money from people in need, then your money is not building up the common good but actually opposing it. This is especially true of the people for whom you are directly responsible (such as family dependents), but is also true of larger society.

In these cases, we are referring to the actions you personally make; you’re not morally culpable for other people (like the government or a bank) abusing their money (unless you had some kind of direct influence). When it comes to your own actions, however, you have a responsibility to consider how they might affect the people around you. So for example, if you choose to invest a large amount of money into stocks, but you’re left with no money left to feed your family, that would be wrong. Furthermore, while you are not strictly obliged to give your money to any charity or good cause, it would be neglectful to put all of your money into investments with no concern for the poor. Since you’re not immediately responsible for the poor like you are for your family, you have to discern what kind of charity you can/should give to help them. However, that is not an excuse to do nothing for the poor, because we do all have some responsibility to the poor.

Returning to the main point, investing to build up one’s financial resources is not immoral in itself, but it could become immoral if it prevents the good of others. This tends to be things like not providing for those in need or selfishly withholding money from those in need. There is another pitfall to be mindful of, however: gambling. Investing in stocks is fine, but stock trading can also become a kind of gambling when taken too far. You may quickly find yourself trading money away which you (or your family) need for your livelihood–so be careful not to get carried away either. If you are ever in doubt about your financial habits, a good litmus test is to ask yourself the question: “To whom does all this belong?” If you find that your honest answer is “myself,” be careful–you may be struggling with greed. Nothing we have in this world belongs to us; it all belongs to God. Even the things we have “earned” for ourselves come as gifts of his providence. It’s helpful to keep this in mind often, so that we don’t become too attached to our possessions; what is here one day may be gone the next. But we have nothing to hear! God promises that he will always provide for our needs; we have only to “seek first his Kingdom” (Matthew 6:33).