4 ms·
Incentives matter. The extremist solution would be to ban executive compensation tied to stock price and some mechanism where every penny more that goes into bu
by passwordoops 2y ago
Incentives matter. The extremist solution would be to ban executive compensation tied to stock price and some mechanism where every penny more that goes into buybacks/dividends than R&D/CapEx is taxed at 105%.
Oh, and make executive and BoDs personally and criminally liable for safety fiascos like the 737MAX. I bet you'll see culture change in a hurry under those circumstances
- gigachadbro 2y agoJust make stock buy-backs illegal. It would streamline a lot of "focus" issues when it comes to financial "engineering" mindsets.
- dh2022 2y agoStock buy-backs are a tax efficient way to send distribute to shareholders. If you make them illegal then the only way left to distribute money to shareholders is via dividends. Want to make that illegal as well???
- Nemo_bis 2y ago"Some mechanism" is called simply taxation. In 1944, the top income tax bracket in the USA was 94 %. Nowadays you'd also need a wealth tax to deal with the perverse incentives caused by past accumulation of stock. https://en.wikipedia.org/wiki/Income_tax_in_the_United_States#Income_tax_rates_in_history https://en.wikipedia.org/wiki/Income_tax_in_the_United_State... https://www.newyorker.com/magazine/2020/03/09/thomas-piketty-goes-global https://www.newyorker.com/magazine/2020/03/09/thomas-piketty...