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Correct. But they seem to have sorted out many of the biggest issues. They could probably continue profitably as-is for the foreseeable future though, which is
by FredPret 3y ago
Correct. But they seem to have sorted out many of the biggest issues. They could probably continue profitably as-is for the foreseeable future though, which is really the most you can hope for from a business.
- xp84 3y agoWhile I actually agree with you personally that not everything should have to grow forever, a business that "just" delivers a consistent profit every year is considered a failure by those who expect YoY capital appreciation (at some multiple of the interest rate on a savings account), i.e. shareholders. Such businesses usually get sold to someone with a "growth" plan for them, which is usually some combo of combining overhead expense by merging it with another business, cost-cutting, as well as the more toxic short-term tricks such as selling all their owned land and leasing it back to goose profits for a few years. Oh, and share buybacks.
- FredPret 3y agoI'm sure that's true for many shareholders; anecdotally I'm a very happy US Steel shareholder (especially after today!). There are many folks who are long-term-value oriented who would much rather own a healthy and sustainable business than something that looks good short-term but is getting IBM'ed long-term. Case in point: Warren Buffett and See's Candy. I like the steady accumulation of equity or dividends paid out to me. The business doesn't need to go to the moon for that to happen.
- lavajava 3y agoCan you please explain how Warren Buffett has IBM’ed See’s Candy over the long-term?
- FredPret 3y agoI meant the opposite. Warren Buffett is letting See's Candy is happily chug along, staying true to their identity (as far I hear, I'm not a customer), whereas another investor might have insisted on quick quarterly results and ended up IBMing them.
- 4ggr0 3y ago> While I actually agree with you personally that not everything should have to grow forever nothing should have to grow forever. especially not amounts of natural resources, or basic necessities like food and beverages.
- FredPret 3y agoWe've barely scratched the surface of the planet, literally. The deepest mines are 4km deep; mineral deposits are likely to get richer as you go deeper. With desalination, nuclear + solar + geothermal, we can feed an essentially unlimited number of people. There are always second-order effects to everything, including growth. But I find it interesting that we have such a huge runway ahead of us, without even considering resources and energy elsewhere in the solar system.
- 4ggr0 3y agowell, you know. climate change is a tiny example of what can happen after you start treating resources like they're limitless. we can use the solar system, of course, but just discarding earth because other planets are available, seems a bit wasteful.
- FredPret 3y agoMore intensive resource use is also the answer to climate change. The problem is CO2 & friends, not growth itself. A knee-jerk response against growth is hardly going to fix the situation. We can drastically reduce our footprint while growing the economy even faster by building more nuclear + solar power, and digging deeper, improving our water treatment ability, etc.
- 4ggr0 3y agowhat about lowering our usage? or more efficiently use what we have, even if it means less growth for the economy.
- 3y ago