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How is this putting wall st first when they have tanked their rep and stock price
by kingkawn 3y ago
How is this putting wall st first when they have tanked their rep and stock price
- fwip 3y agoWell, obviously, they weren't planning on this outcome.
- inetknght 3y ago> they weren't planning on this outcome Unless they didn't plan at all (an answer I would not accept, or would advocate for prison terms if true), then they absolutely did plan for this outcome. Putting safety importance somewhere except the most important factor in manufacturing commercial passenger planes puts this exact outcome in the "planned" category.
- fwip 3y agoWell, no, that's clearly not the case. It's always possible to improve the safety of a plane by spending more money. Airlines could do a 72-hour safety review of every plane after every flight. Planes could have 7 copies of every system/sensor instead of 3. We could stick 6 pilots up in the cockpit in case the first 5 have simultaneous mid-air heart attacks. Deciding to shift the needle from "safety" toward "economic feasibility" is very often the correct thing to do, and vice versa.
- graemep 3y agoOn a short term view. The problem is that keeping investors happy, it is keeping investors with a short term outlook happy. If anything more than two years is too long term to care about, then the best strategy is to take risks and hope it does not catch up with you before then.
- dv_dt 3y agoAmazon succeeded in large part because they ignored the complaints of short term investors for years. So while I think that the widespread short term outlook is definitely an issue, it is a choice of boards and CEOs. Ultimately if the company tanks on being blind to long term risks - short term investors will be the fastest to leave the stock.
- JumpCrisscross 3y ago> Amazon succeeded in large part because they ignored the complaints of short term investors for years The market is ultimately made up of people. Some of them are short-term oriented. Some of them are not. Which cohort a company chases very much defines the relationship, and Boeing—unfortunately—chose wrong.
- dv_dt 3y agoYes to be clear I very much agree that Boeing leadership chose wrong. I was aiming to speak to the impression that companies somehow had to respond to short term investors - they very much don’t and can justify financial outcomes on consistent long term objectives & decisions
- kingkawn 3y agoI ain’t mean this about you personally; this is the dumbest logic imaginable. Anytime someone cries crocodile tears about the rationality of the market please refer back here to B0eing’s self destruction
- spxneo 3y agoEarning estimates are manipulated to dangle a carrot for the executives to act on short term signals for short term outcomes with zero regard for long term consequences. Short term investors love it, moving from stock to stock, like locusts, using up the resources like mobsters that takeover a business to create financial leverage to take over more businesses. It's this irrational and unapologetic greed that Americans like to accuse other cultures of but guilty of themselves.
- hackerlight 3y agoAgency conflict of interest. It's like Enron executives. They put society third, Wall Street second, and themselves first. That's the default alignment of incentives in our capitalist system by the way. Good governance and good regulations can try to align all those things but often falls short.