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> More than half of the 19,000 jobs to be cut will be in its non-billable corporate functions, Accenture said, sending its shares up more than 4% before the bel

by pil0u 4y ago

> More than half of the 19,000 jobs to be cut will be in its non-billable corporate functions, Accenture said, sending its shares up more than 4% before the bell. I'm not yet accustomed to the fact that some people see the equivalent of a city being laid off as a favorable signal.

kobalsky 4y ago
As I understand it's not a favorable signal but a correction. The market price, in theory, already reflected the expected demand downturn so measures taken to lower their "non-billable corporate functions" costs usually means that the market will correct the price. That said, I'm not a fan of corporate behemoths using humans as an elastic resource or ballast they can throw away at the first sign of problems. This isn't a mom and pop that can't keep paying an employee during hard times but a public company keeping their year-to-year indicators looking pretty.
maxlamb 4y ago
The stock price reflects the expected sum of all future profits, not the general opinion of the company based on today’s news
LeifCarrotson 4y ago
It's a favorable signal if you think that they have too many employees for their current requirements - or if you think that they have enough inertia to produce good results in the next quarter due to a drastic cut in expenses, and you plan to exit before the long-term effects catch up to them. It could also mean that you still think that their ship is sinking, but it's just sinking a little slower now. No one thinks it's an ethically good thing to do, or that the human lives affected by it are irrelevant. The direction of their stock is almost completely divorced from those kinds of questions, and is instead a purely financial judgement. It's good to be somewhat confused by that state of affairs, otherwise you'll mistake wealth or popularity for goodness or rightness. We need to be careful to structure the our society and the means to change our culture such that we don't systemically bias it towards unfavorable outcomes that might be more successful in a more ruthless environment.

by pil0u 4y ago

kobalsky 4y ago

As I understand it's not a favorable signal but a correction. The market price, in theory, already reflected the expected demand downturn so measures taken to lower their "non-billable corporate functions" costs usually means that the market will correct the price. That said, I'm not a fan of corporate behemoths using humans as an elastic resource or ballast they can throw away at the first sign of problems. This isn't a mom and pop that can't keep paying an employee during hard times but a public company keeping their year-to-year indicators looking pretty.

maxlamb 4y ago

The stock price reflects the expected sum of all future profits, not the general opinion of the company based on today’s news

LeifCarrotson 4y ago

It's a favorable signal if you think that they have too many employees for their current requirements - or if you think that they have enough inertia to produce good results in the next quarter due to a drastic cut in expenses, and you plan to exit before the long-term effects catch up to them. It could also mean that you still think that their ship is sinking, but it's just sinking a little slower now. No one thinks it's an ethically good thing to do, or that the human lives affected by it are irrelevant. The direction of their stock is almost completely divorced from those kinds of questions, and is instead a purely financial judgement. It's good to be somewhat confused by that state of affairs, otherwise you'll mistake wealth or popularity for goodness or rightness. We need to be careful to structure the our society and the means to change our culture such that we don't systemically bias it towards unfavorable outcomes that might be more successful in a more ruthless environment.