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It's a mistake (though a common one, and almost an American truism) to equate "being a shareholder" with "fixated on next quarter's earnings above all other fac

by irons 16y ago

It's a mistake (though a common one, and almost an American truism) to equate "being a shareholder" with "fixated on next quarter's earnings above all other factors". There are other standards of behavior, even if you still profess an interest only in money, especially if you still want your company to be thriving in a decade.

grandalf 16y ago
True. It's even true from the standpoint that any investment comes with a notion of time frame. If I invest in Google I'm not looking to cash out next quarter, so I'd rather that Google allocate funds toward projects that come to fruition just before my intended cash-out date.
nanairo 16y ago
I agree that a shareholder may be interested in the long term, though not many are (what happens in the long term is not a problem if you manage to sell your shares beforehand). At the same time I think most shareholders want to make money from their shares. I am sure that there are a significant amount of ethical shareholders, but not enough that their behaviour would change the shares strongly. They would simply pick a company that is more ethical. But as long as Google makes the earnings it makes, I am sure others would happily take their place. As for the short-term vs. long-term I would agree with you if Google ended up losing business. But I think we (as in the geeky people on this and similar sites) are out of touch if we think they'll lose much. Look at Facebook and the failed boycott. I don't think a few PR gaffes from its CEO would do Google any harm. Look: I am not defending Google. I hate that people (and shareholders) are not more ethical. I hate that shareholders may hold onto their stock for only a few days or months: originally it was meant as a way to fund companies you believe in, not as a bet on the market. I am just trying to justify why I think there's no way that this or many more gaffes like this would force Schmidt to resign (or be fired).
- barrkel 16y ago
  Expectations of future earnings affect share prices today. And of course if stock markets were perfectly efficient with full information, then stock prices would never change - they would be the net present value of all future earnings. So the question isn't whether or not Google is profitable today. It's rather, is Google going to be as profitable as it could be in the future? If it keeps up with what it's doing, there's a risk it could attract unwelcome attention from regulators, especially in Europe. It doesn't take much pissing off of the public re privacy for politicians to be motivated to meddle. Google would do well to put that off as much as possible and minimize potential ramifications. And that work pays off in today's prices.
  - nanairo 16y ago
    I perfectly agree. It's a risk Google is taking: Schmidt has its pros and cons. The question is not that having a bad reputation may be a risky and one day hurt their revenues. The question is how that would compare to not having done anything, i.e. a Google where Schmidt was not in command. Would we have had Buzz, AdMob, Android and Facebook killers? So it's the benefit of having Schmidt more or less than the disadvantages brought by his gaffes? My feeling is that apart from a people in tech related websites, most people would soon forget about these gaffes. As evidence I pointed out to Google's current share prices, and other companies that have had similar gaffes or actual problems, such as Apple or Facebook.

by irons 16y ago

grandalf 16y ago

True. It's even true from the standpoint that any investment comes with a notion of time frame. If I invest in Google I'm not looking to cash out next quarter, so I'd rather that Google allocate funds toward projects that come to fruition just before my intended cash-out date.

nanairo 16y ago

I agree that a shareholder may be interested in the long term, though not many are (what happens in the long term is not a problem if you manage to sell your shares beforehand). At the same time I think most shareholders want to make money from their shares. I am sure that there are a significant amount of ethical shareholders, but not enough that their behaviour would change the shares strongly. They would simply pick a company that is more ethical. But as long as Google makes the earnings it makes, I am sure others would happily take their place. As for the short-term vs. long-term I would agree with you if Google ended up losing business. But I think we (as in the geeky people on this and similar sites) are out of touch if we think they'll lose much. Look at Facebook and the failed boycott. I don't think a few PR gaffes from its CEO would do Google any harm. Look: I am not defending Google. I hate that people (and shareholders) are not more ethical. I hate that shareholders may hold onto their stock for only a few days or months: originally it was meant as a way to fund companies you believe in, not as a bet on the market. I am just trying to justify why I think there's no way that this or many more gaffes like this would force Schmidt to resign (or be fired).

barrkel 16y ago
Expectations of future earnings affect share prices today. And of course if stock markets were perfectly efficient with full information, then stock prices would never change - they would be the net present value of all future earnings. So the question isn't whether or not Google is profitable today. It's rather, is Google going to be as profitable as it could be in the future? If it keeps up with what it's doing, there's a risk it could attract unwelcome attention from regulators, especially in Europe. It doesn't take much pissing off of the public re privacy for politicians to be motivated to meddle. Google would do well to put that off as much as possible and minimize potential ramifications. And that work pays off in today's prices.
- nanairo 16y ago
  I perfectly agree. It's a risk Google is taking: Schmidt has its pros and cons. The question is not that having a bad reputation may be a risky and one day hurt their revenues. The question is how that would compare to not having done anything, i.e. a Google where Schmidt was not in command. Would we have had Buzz, AdMob, Android and Facebook killers? So it's the benefit of having Schmidt more or less than the disadvantages brought by his gaffes? My feeling is that apart from a people in tech related websites, most people would soon forget about these gaffes. As evidence I pointed out to Google's current share prices, and other companies that have had similar gaffes or actual problems, such as Apple or Facebook.