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This seems like an unfair take. There are thousands of publicly corporations but the flooded money didnt go equally to all of them. They didnt even end up equal
by TuringNYC 6y ago
This seems like an unfair take. There are thousands of publicly corporations but the flooded money didnt go equally to all of them. They didnt even end up equally on a cap-weighted basis. Instead, they ended up disproportionately into select industries and disproportionately into select companies?
As you note, money printing is a big part the tide went up. But why did Amazon go up even more than the tide? I think it is more complex than just printed money. It is partly aligned incentives, incentivized workers, ruthless execution, focus, internal investment, and i'm sure you can think of some bad reasons also.
- imtringued 6y agoAccess to capital is the primary factor. Those specific companies had access to 2% or even 0% capital.
- TuringNYC 6y agoBut what about Exxon, CVS, Verizon, Goldman Sachs, and Allstate? All these companies had access to the same capital, yet not all did as well as Amazon, et al. Goldman Sachs, theoretically, even has access to the Fed Discount window (hence, access to even more capital than FAANG) At some point we do need to acknowledge better execution, more aligned incentives, etc. One particular thing to note, many of the non-FAANG companies treat their employees terribly, especially engineers. Comp is nothing compared to FAANG, and yet they expect cheery engineers and other "low level workers" who give it their all and bring success to the company. And perhaps the formula doesnt work, which is good, because all workers should share in the success of their efforts.