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You could also make the shareholders accountable. Seize a percentage of their ownership, for instance. That way, the company itself doesn’t suffer. Would be pai

by marvin 8y ago

You could also make the shareholders accountable. Seize a percentage of their ownership, for instance. That way, the company itself doesn’t suffer. Would be painful the first few times, because it would also hit pension funds and minority investors, but investors should quickly adapt. This is also how bailouts should work to ensure that owners/leadership doesn’t gamble on a bailout.

SEJeff 8y ago
This is what Maduro and Chavez before him did in Venezuela. It results in flight of all foreign investment out of the companies and is a terrible idea as a result.
- mijamo 8y ago
  This is just wrong. The main problem of Venezuela was the central bank policy and fixed exchange rate while printing money, and clientelism at all levels leading to sub efficient systems and unfair competition. Of course investor left when their dolars lost 60% of their real value when converted in bolivares.
  - SEJeff 8y ago
    So Oil firms didn't leave after their refineries were nationalized? They didn't break down because non-Exonn / Chevron employees left and the existing people didn't know how to fix them? Hmmmm: https://en.wikipedia.org/wiki/History_of_the_Venezuelan_oil_industry https://en.wikipedia.org/wiki/History_of_the_Venezuelan_oil_... Granted, the monetary policy certainly helped, but when you spend billions investing in a country to only have that money literally stolen from you, so much so that a court ordered PDVSA to pay Conoco $2 billion, all investment is going to leave the country.
harperlee 8y ago
A big enough fine has the same effect, doesnt it?
- marvin 8y ago
  Not if it results in the company collapsing. You couldn't do this with the banks in the wake of the 2008 financial crisis, for instance. I'm not talking about expropriating the whole ownership of the company, I'm saying demand the fine is paid in shares of the company rather than dollars. This type of punishment doesn't affect the operations of the company unless the owners do something stupid in response, which will be prevented by shareholder interest laws.

by marvin 8y ago

SEJeff 8y ago

This is what Maduro and Chavez before him did in Venezuela. It results in flight of all foreign investment out of the companies and is a terrible idea as a result.

mijamo 8y ago
This is just wrong. The main problem of Venezuela was the central bank policy and fixed exchange rate while printing money, and clientelism at all levels leading to sub efficient systems and unfair competition. Of course investor left when their dolars lost 60% of their real value when converted in bolivares.
- SEJeff 8y ago
  So Oil firms didn't leave after their refineries were nationalized? They didn't break down because non-Exonn / Chevron employees left and the existing people didn't know how to fix them? Hmmmm: https://en.wikipedia.org/wiki/History_of_the_Venezuelan_oil_industry https://en.wikipedia.org/wiki/History_of_the_Venezuelan_oil_... Granted, the monetary policy certainly helped, but when you spend billions investing in a country to only have that money literally stolen from you, so much so that a court ordered PDVSA to pay Conoco $2 billion, all investment is going to leave the country.

harperlee 8y ago

A big enough fine has the same effect, doesnt it?

marvin 8y ago
Not if it results in the company collapsing. You couldn't do this with the banks in the wake of the 2008 financial crisis, for instance. I'm not talking about expropriating the whole ownership of the company, I'm saying demand the fine is paid in shares of the company rather than dollars. This type of punishment doesn't affect the operations of the company unless the owners do something stupid in response, which will be prevented by shareholder interest laws.