rufus
rock and roller
Re: Campaign 2016 Part, let's say, X: There's a red moon rising On the Cuyahoga River
Exactly. The staid, solid company cruising along, paying out a 35 cent/share dividend quarter after quarter, year after year, in perpetuity is a bad investment. It needs to be 35 cents this quarter, and 40 next, and 50 the quarter after that.
Couple that with the CEO's desire to make his huge yearly bonus, and he has no incentive to run his company for the long haul. If he needs to hit a number to get that bonus, he's gonna do it, no matter what the effect long-term on the company will be. If he has to lay off his highest earning and most competent people to cut costs, he'll do it. If he has to sell of his most profitable division to boost the earnings of those left, he'll do it. If he has to use all the company's cash reserves to buy back stock and artificially inflate its price, he'll do it. If he has to shut it down and move all those jobs overseas, he'll do it. Cause his seven figure bonus depends on it.
And it's always more more more. A good return is never enough.
Exactly. The staid, solid company cruising along, paying out a 35 cent/share dividend quarter after quarter, year after year, in perpetuity is a bad investment. It needs to be 35 cents this quarter, and 40 next, and 50 the quarter after that.
Couple that with the CEO's desire to make his huge yearly bonus, and he has no incentive to run his company for the long haul. If he needs to hit a number to get that bonus, he's gonna do it, no matter what the effect long-term on the company will be. If he has to lay off his highest earning and most competent people to cut costs, he'll do it. If he has to sell of his most profitable division to boost the earnings of those left, he'll do it. If he has to use all the company's cash reserves to buy back stock and artificially inflate its price, he'll do it. If he has to shut it down and move all those jobs overseas, he'll do it. Cause his seven figure bonus depends on it.