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I disagree with this statement they're quoting: EURoespread of share options may be distorting the economy, contributing to a temporary overvaluation of equiti
by tx 19y ago
I disagree with this statement they're quoting:
EURoespread of share options may be distorting the economy, contributing to a temporary overvaluation of equities, encouraging short-sighted managerial decisions and storing up problems for companies in future.
I would not call those decisions short-sighted, because typically there is a hefty vesting period associated with your options. Additionally, most employers (if they are smart) keep giving more options to top performers. Therefore, most valuable employees/executives will always have some non-vested shares and it will be their interest to have a share price constantly growing as opposed to sudden spikes and drops.