5 ms·
It's starting. Most of the rest of the U.S. thinks the layoffs that have hit the tech sector are because they overextended and made poor decisions during the s
by nostrademons 4y ago
It's starting.
Most of the rest of the U.S. thinks the layoffs that have hit the tech sector are because they overextended and made poor decisions during the stimulus-fueled boom. That may be true, but a falling tide grounds all boats. We'll see some big names in the economy do mass layoffs this summer - that's the whole point of the Fed's actions.
My marker for when it's time to re-enter the stock market is when an S&P 500 company goes bankrupt.
- 1270018080 4y agoMarket timing is a fool's errand
- chiefalchemist 4y agoBut is this a true falling tide or simply McDonalds pandering to investors' expectations? That is, look ma, we're so serious and worthy we're laying off people too. Imagine getting paid the big bucks to make such decisions. Bankrupt? Better to look for companies where leadership runs counter to "prevailing conventional wisdom" and actually leads for others to follow.
- patrickthebold 4y agoGreat point. The article doesn't mention of McDonalds is profitable. I'd wager it is even without the layoffs. On one hand, doing layoffs may make investors happy, on the other hand if we get a recession because a bunch of profitable companies keep laying everyone off, then maybe that's not so great for investors after all.
- Fatnino 4y agoI think McDonalds stock just did really well. This is surprising to me. It's literally at it all time high.
- chiefalchemist 4y agoI believe that's called The Tragedy of The Commons.
- rocket_surgeron 4y agoMcDonald's only made $6,000,000,000+ last year on $23+ billion in revenue at a ~35% profit margin. They reversed the downward trend in revenue (which occurred simultaneously with a tremendous increase in profitability) and bounced back from 2020 magnificently. Their stock price has ONLY roughly doubled in the last five years and their dividend has ONLY doubled in the last 10. Obviously that is not good enough so they're going to lay off a couple thousand people to get that margin up by two points. Pathetic. This is 100% a stock juicing play. I'm willing to bet there's a cadre of executives who all came on at the same time pre-pandemic (during the revenue turnaround) whose options are maturing and the price isn't where they want it to be because of the pandemic. McDonalds is as healthy a company as its food is unhealthy.
- mehlmao 4y agoExecutives will destroy lives at random as a show of good will to the capital class. Time to bring back the guillotine.
- chiefalchemist 4y agoMy only hope is that one day we have a media staffed by legitimate journalists that would convey such details. It's obviously not illegal. But the more the (consumer) market knows, the better its decisions on where to open their wallets.
- etempleton 4y agoWe will see. I have no doubt there will be more layoffs, but the pending/potential recession feels like an excuse. McDonalds is plenty profitable.
- sammalloy 4y agoHave you been inside a McDonald’s recently? The prices are outrageous. I don’t see how the average person could afford to eat there.
- bkjelden 4y agoThis is true of all restaurants. In fact, I would expect McDonald's to be a beneficiary of this as consumers replace more expensive options with McDonald's.
- dsfyu404ed 4y ago>but a falling tide grounds all boats. More like the biggest piece of shit on the water is first to sink in the storm. Tech was that POS. But other sectors are gonna feel the storm too. But they'll probably do better because smaller proportions of those industries are running on VC monopoly bucks that go tits up when the fed raises rates.
- breckenedge 4y agoGenerally shit floats, but I’ve never observed shit dynamics in a storm.
- evantbyrne 4y agoTheir stock is up 13% over the past year. Maybe it's just trendy to lay people off right now?
- JumpCrisscross 4y ago> the U.S. thinks the layoffs that have hit the tech sector are because they overextended and made poor decisions during the stimulus-fueled boom That's part of it. The other is there are categories of American white collar work which have always been bullshit jobs, it's just now okay to eliminate them.
- hammock 4y agoYou seem to be saying the same thing
- JumpCrisscross 4y ago> seem to be saying the same thing Many companies (mostly tech) increased hiring of all kinds, bullshit or not, during the last years. Those are the excess jobs. Reversing them is the short-term correction. For much longer, corporate America has been staffing up departments which practically do nothing. Eliminating them is the longer-term trend.
- hammock 4y agoZero interest rate policy means they were the same thing
- JumpCrisscross 4y ago> Zero interest rate policy means they were the same thing No, it doesn't, because one of these things pre-dates and was not caused by low rates. (Office Space was released when rates were half a point above where they are now [1].) [1] https://www.bankrate.com/banking/federal-reserve/history-of-federal-funds-rate/ https://www.bankrate.com/banking/federal-reserve/history-of-...
- hammock 4y agoOk what is your evidence that bullshit jobs are being structurally eliminated in a way that is unrelated to interest rate policy?
- lackbeard 4y agoWasn't SVB an S&P 500 company?